by Brian Hioe

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Photo Credit: Peellden/WikiCommons/CC BY-SA 3.0

IN AN UNUSUAL EXCHANGE in the legislature yesterday, KMT caucus leader Fu Kun-chi lashed out at TSMC’s plans to invest 100 billion USD in the US. This occurred in the course of an exchange between Fu and Premier Cho Jung-tai, who was giving a report to the legislature, and subsequently questioned by legislators.

The prospect of the premier being required to report to the legislature was one pushed for by the KMT many times in the past year. The notion eventually became the object of much wrangling between the KMT and DPP.

Namely, it was clear that the KMT hoped to interrogate the premier publicly, in order to create public incidents that could be leveraged on for electoral purposes. This proves a case in point, though Cho’s retorting to Fu’s line of question was what drew attention.

In particular, Fu claimed that TSMC’s plans to do so were illegitimate, as they had not been “approved by the national people”, referencing how TSMC has sometimes been framed as the “Holy Mountain” that protects Taiwan. Namely, the world’s dependence on Taiwanese semiconductors keeps the world invested in Taiwan’s defense from the prospect of a Chinese invasion. Taiwan produces over 90% of advanced semiconductors and over 60% of global supply.

Cho then retorted, questioning Fu if he represented the central government. Fu recently came under scrutiny for claiming to represent Taiwan’s central government during a trip to Hong Kong. Fu does not represent the central government, as he is the KMT caucus leader, but by contrast, Cho is a serving official of the central government.

After a moment in which Fu seemed caught off guard by Cho’s question, he went on to state that TSMC’s investment plan could not proceed because it was not subject to legislative approval. Subsequent comments by Fu also framed TSMC as a product of the KMT’s stewardship of Taiwan, in that TSMC began as a company during the authoritarian period, in which the KMT ruled as the sole permitted political party in Taiwan.

Such argumentation is not new from the KMT. In effect, it has increasingly become common for the KMT to claim that it is responsible for TSMC’s existence and, in that sense, to suggest that it should be TSMC’s steward. The suggestion would be that TSMC is, in itself, something like a KMT party asset.

Video of the exchange

There is often much focus internationally on how the KMT has historically based its claim that it should be the political party in charge of Taiwan based on asserting that it is the only political party in Taiwan able to conduct communication with the CCP. At the same time, this neglects that the KMT has also sometimes claimed a historical narrative as to why it should be in charge of Taiwan, claiming in effect that the KMT created Taiwan, is responsible for its successes, and so should again be left to make decisions for Taiwan.

TSMC is, of course, a private corporation, even if it is one in which the Taiwanese government is the largest individual shareholder.

TSMC has sometimes been understood as having stayed in Taiwan rather than having gone to China because it can reap the benefits of a close relationship with the Taiwanese state. At the same time, one notes that TSMC’s policies have hewed close to whoever is in power.

During the Ma administration, TSMC and the Taiwanese chip industry writ large built facilities and expanded investment in China, at a time in which the ruling KMT hoped to facilitate closer political and economic relations between Taiwan and China. Even so, some limits were placed on investment, due to security concerns.

Now, with the DPP having been in power for an unprecedented three consecutive presidential terms, TSMC aims to expand facilities in the US that began during the Tsai administration. This gestures toward TSMC’s going with the policy of whoever holds power in Taiwan, then, even if it is true that TSMC also makes decisions based on its own market calculations and not merely to please the government of Taiwan.

Still, seeing as TSMC is a partially state-owned enterprise, it would not be surprising if the KMT uses this as a point of leverage. In the past year, the KMT has made efforts to expand legislative power on the basis of its slim majority in the legislature, in arrogating powers that normally belong to the judiciary or executive branches of government to the legislature, and attempting to freeze the Constitutional Court. It would not be surprising, then, if the KMT next seeks to expand legislative power to wrest control of TSMC from the executive branch of government, seeing as purview over state investment currently falls under the executive branch. Fu’s comments may gesture toward this possibility.
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