SOURCE / INDUSTRIES
Taiwan firms welcomed to mainland’s 5G drive
Cooperation can build on complementarities in semiconductor sector
Published: Nov 04, 2019 07:53 PM

Photo: VCG



Allowing Taiwan-funded companies to participate in the Chinese mainland's 5G development will inject fresh impetus to Taiwan's semiconductor industry and bring opportunities to both as the two are highly complementary in the semiconductor industry, experts said.

On Monday, the Taiwan Affairs Office of the State Council, along with 19 government agencies, announced measures to promote economic exchanges across the Taiwan Straits. 

Under the measures, Taiwan-funded companies are allowed to participate in the mainland's 5G technology research and development (R&D), standard setting, product testing and network building based on market principles.

5G will bring great opportunities to relevant Taiwan companies, as the mainland's information and telecommunications market is huge and the 5G industry has great potential, the office said.

"Besides 5G phones, the commercialization of 5G will boost fast growth of the new economy, including artificial intelligence, the Internet of Things and autonomous driving. This will greatly drive demand for chips from Taiwan," Zhang Guanhua, deputy director of the Beijing-based Institute of Taiwan Studies of the Chinese Academy of Social Sciences, told the Global Times on Monday.

In the global cooperation era, the mainland's 5G development is also open to the world and it welcomes capable Taiwan companies, Xiang Ligang, director-general of the Beijing-based Information Consumption Alliance, told the Global Times.

"Who else can Taiwan semiconductor companies sell their products to if not to the mainland? Without the mainland market, Taiwan will lose a huge opportunity," Xiang said.

The semiconductor industry is one of the four pillars of Taiwan's economy. Therefore, despite US pressure to curb Taiwan chip exports to the mainland, Taiwan companies continue to trade with the mainland. 

Taiwan website udn.com reported in June that 5G will greatly improve Realtek Semiconductor Corp's market share in terms of Wi-Fi chips, while RichWave Technology Corp's new front-end modules - a built-in module used in wireless circuits - have already been adopted by mainland clients.

RichWave Technology Corp declined to comment on the Taiwan Affairs Office's new policies when reached by the Global Times on Monday, but said it supplies components to mainland clients according to their needs.

China is a global leader in 5G R&D. A white paper released by CCID Consulting, affiliated with the Ministry of Industry and Information Technology, showed that the overall market scale of China's 5G industry is expected to reach 1.15 trillion yuan ($163.5 billion) by 2026.

Mainland basic telecommunications carriers are promoting the establishment of 5G networks in an orderly way. 

By September, more than 80,000 5G base stations had been built in the mainland, according to the Taiwan Affairs Office.

The authorities have also encouraged local governments in the mainland to provide policy support for Taiwan companies that increase investment, while saying that Taiwan-based enterprises can participate in the setting and amendment of industry standards on equal terms with their mainland counterparts.