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Published Date: 2024-08-21
Publication:2023.12
Principal Investigator:顏慧欣Yen, Huai-Shing
Researchers:許裕佳Hsu, Yu-Chia、聶廷榛、黃禾田、林卓元、蔡晴雯、羅婉甄
This study explores the restructuring
of the global trade and economic order by the United States in the first half
of 2023 and its potential impact on Taiwan. It focuses on three aspects: U.S.
foreign policy towards China, high-tech-related regulation, and the supply
chain review. The summarised research findings are presented below.
1. U.S. foreign policy towards China
:
In contrast to the executive branch,
the U.S. Congress has taken a more distinct stance on countering China. This
study delves into topics including countering economic coercion and the broader
landscape of US-China competition, analyzing the various bills proposed by the
current U.S. Congress. In terms of countering economic coercion, this
study compares the United States Countering Economic Coercion Act of 2023
(draft) with the EU's Anti-Coercion Instruments (ACI). This research discovered
that the U.S. draft bill leans towards long-term institutionalized cooperation.
Apart from countering China's formal use of economic coercion, the U.S. draft
also takes into account China's informal use of economic
coercion. Additionally, it includes a mechanism to assist countries
that are being coerced and establish international cooperation to
collectively deter nations that engage in economic
coercion. Conversely, the EU's ACI solely concentrates on countering China
without providing further suggestions for aiding the countries under
coercion.
Furthermore, this study assesses bills
regarding economic and trade with China proposed in the 118th U.S. Congress
from January 2023 until now. Notably, recent U.S. legislative trends reveal the
following key features: Firstly, the U.S. legislative branch currently regards
establishing both "domestic manufacturing capacity" and "friend-shoring"
as equally significant. Secondly, the U.S. remains dedicated to actively
strengthening the safeguarding of key technologies and minimizing any
adverse effects resulting from these measures. Thirdly, bills regarding
investment restrictions encompass not only high technology but
also food safety and the food supply chain, indicating
the wider concerns that the U.S. harbors towards China.
Given the difficulty in thawing
U.S.-China relations in the short term, Taiwan should take the opportunity to
increase its investment in the U.S., thereby enhancing its indispensability to
the global supply chain. Furthermore, as a multilateral and institutionalized
joint mechanism for responding to economic coercion is still in the process of
being formed, it is appropriate for Taiwan to participate in the process
actively and to share with others its own experience of necessary assistance
and support for the victimized countries in the face of coercion, which would
be conducive to enhancing the effective functioning of the mechanism concerned.
Finally, to improve Taiwan's economic resilience in response to
China's economic coercion, it is advisable to conduct a more comprehensive
analysis and discussion about Taiwan's "risk aversion" strategy
for industries and sectors that are closely linked to China or
products and services that are heavily dependent on a sole specific
source. Besides, Taiwan should not only enhance its resilience
through its own capacity but also actively seek cooperation
partners to establish long-term systemic partnerships in areas that require
external assistance during periods of stability.
2. U.S. High-Tech-Related Regulation
and Trends in International Alliances:
The U.S. actively cooperates and
leagues with key international allies regarding semiconductor or other
technology fields. Some specific programs include the "Export Controls and
Human Rights Initiative Code of Conduct (ECHRI)" and the ban on the usage
of commercial spyware. Regarding export control on semiconductor, the
U.S.-Japan-Dutch Tripartite Agreement and the U.S.-EU Trade and Technology
Council (TTC) Working Group have continually been under discussion. This
study also includes the outbound investment screening regime currently being
discussed by the Biden Administration as
one of the aspects to evaluate U.S. high-tech regulation. In this context, the
study presents the following observations and recommendations:
(1)
Taiwan should actively strive to become one of the CFIUS
Excepted Foreign States, which would also allow us to review our
investment screening mechanism.
(2)
U.S. export control on semiconductor will affect the
global supply chain and present challenges and opportunities for Taiwan's
semiconductor industry.
(3)
The U.S. restrictions on multinational investment in
semiconductor may accelerate China’s efforts to increase self-reliance,
and China's domination of mature node semiconductors may become Taiwan's main
competitor.
(4)
Taiwan and the U.S. should continue strengthening
cooperation in the semiconductor field by sharing research and development (R&D)
resources and market intelligence to jointly meet the challenges of global
technological competition.
3. Review of the U.S. Supply
Chain Policies
This study focuses on the CHIPS and
Science Act and the Inflation Reduction Act (IRA), analyzing how do these
measures promote supply chain security. Overall, the U.S. industrial policy has
yielded promising initial results despite being questioned internationally in
recent years. Thus, Taiwan should view this as new opportunity to diversify the
economic risks, satisfy customer demands, carve out new markets, and foster
industrial upgrading. Therefore, this study believes that in the future, we
should make use of exchange mechanisms such as the Economic Prosperity
Partnership Dialogue (EPPD) and the Technology Trade and Investment
Collaboration Framework (TTIC) to discuss with the U.S. options and ways to
deepen cooperation, which may include: (1) assisting Taiwan's semiconductor
enterprises in benefiting from the subsidies provided by the US Department of
Commerce in a smooth and orderly manner; (2) leveraging the EPPD and TTIC
mechanisms to explore the modalities and feasibility for Taiwan to utilize the
International Technology Security and Innovation (ITSI) Fund project supported
by Department of State; and (3) discussing the feasibility of establishing a substantial
Taiwan-U.S. partnership on critical minerals.