Globalization and Security: Security Implications of the Taiwanese Chip Industry Migration to China.

This paper examines the various impacts of contemporary globalization on national security, with special reference to the migration of the Taiwanese semiconductor industry to China and its security challenges to the United States, Taiwan and China. The paper adheres to a sectoral approach to the study of globalization-security interconnections and adopts a broadly based definition of security pertaining to the case study in question that encompasses economic, technological and defense security. The analysis of the subject matter is grounded in evidence collected in more than 140 interviews with chip industry, defense sector and government insiders in the US and Asia, as well as English-language and Chinese-language secondary data. On sectoral migration, the paper argues that the scope of the migration is extensive, the direction complicated, the cause multiple, and the outcome significant in boosting the development of the indigenous Chinese chip industry. It has been discovered that some Taiwanese non-state chip actors have violated government regulations in the process of spearheading the migration, and some have even forged business ties with their PRC counterparts associated with the PLA. As for the ensuing security ramifications, it is argued that there is no immediate security risk involved, although long-term strategic repercussions are paramount. The depth and scope of the continuous sectoral migration in years to come will determine the level of economic security risks faced by the US and Taiwan. Long-term technological and defense security repercussions need to take into account two important elements at play: technological change in the sector (increasing commercial-to-military spin-on and dual-use nature of the chip technology), and the PRC dual-track (economic and defense) grand strategy behind its resolve to upgrade its indigenous chip capability. Four pertinent aspects are analyzed: (a) concerns over the PRC chip industrial base, its contribution to the PLA modernization and the ensuing shift in the balance of power in Beijing's favour; (b) technology-related misgivings over the trustworthy supplies of chips for the US and Taiwanese military end uses, as well as the shrinking "chip gap"; (c) fear of denial of chip supply due to foreign dependency; (d) dubious implementation of export control policies at the unilateral and the multilateral level that exacerbate some of the above security repercussions. The concluding section elucidates how the case study helps to show the impact of globalization on security as far as the agency and scope of security, the autonomy and capacity of the state, as well as the balance of power are concerned. To sum up, the study offers a fresh look at the complex security repercussions of the globalization of a strategic industry that occurs in a politically sensitive region in world politics today. It not only helps us disentangle an important policy issue, but also advances our theoretical understanding of the globalization-security interconnections in international relations today. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]