In a nutshell: It's no secret that Taiwan's importance within the global technology industry can't be understated, but in a time of worldwide economic slowdown, crashing consumer demand, and more US sanctions against China's chip industry, did the island nation suffer last year? Not at all. Taiwan semiconductor exports rose for the seventh year in a row throughout 2022. China, meanwhile, saw its imports crash by 15% during the same period.
As per Bloomberg, the Taiwan Ministry of Finance announced that its export of IC chips rose 18.4% from a year earlier, continuing a trend that has been unbroken since 2016. The figures also marked the third year in a row of double-digit growth.
Moves by the United States to lessen its reliance on Taiwan's chip exports have become increasingly important in recent times as China makes more threats toward the island it claims as its own. In July, Commerce Secretary Gina Raimondo warned that the US would face a "deep and immediate recession" if it were ever cut off from the Taiwanese chip manufacturing industry. Passing the Chips Act was a significant step toward more self-sufficiency—the EU is looking to pass its own law.
It will be some time before Taiwan's importance within the semiconductor world dims, especially as its government is offering tax breaks and other incentives to companies such as TSMC to invest in new facilities in its home country. The chip giant is building fabs outside of Taiwan, including the US, much to the annoyance of China.
Speaking of China, the Asian country's imports of semiconductors were down 15% during 2022, falling from 635.6 billion units in 2021 to 538.4 billion units in 2022. Its import of chip-making machines has also fallen, to its lowest point since mid-2020, the result of ever-tightening sanctions imposed by the US and China's strict Covid-zero policy, which it recently abandoned despite the threat of adding even more disruption to the industry.
It's not all good news for Taiwan's semiconductor exports. TSMC recently missed its quarterly revenue forecast for the first time in two years and expects modest revenue declines in the first half of 2023, the result of waning consumer demand that has seen customers such as Nvidia and AMD slash orders.