China Targets Taiwan's Chip Technology to Break Global Containment

China is actively targeting Taiwan's world-leading computer chip industry to obtain advanced manufacturing technology and talented workers, according to a new intelligence report from Taiwan's National Security Bureau.

The report, presented to Taiwanese lawmakers, says China is trying to "lure" Taiwan's high-tech industries including artificial intelligence and semiconductor companies to establish or keep operations in China. This is part of China's strategy to break through international "containment" efforts that have restricted China's access to advanced chip technology.

Taiwan dominates global production of the most advanced computer chips, which are essential for everything from smartphones and cars to military weapons and artificial intelligence systems. Making these chips requires extremely precise manufacturing that takes three to four months and over 1,000 separate processes in ultra-clean facilities.

China faces major challenges in chip manufacturing, including a significant talent gap. The country has been recruiting engineers and technicians from Taiwan to build up its own capabilities. International sanctions have also limited China's access to the sophisticated equipment needed for advanced chip production.

The Taiwan chip industry has become a key battleground in the broader U.S.-China technology competition, with both superpowers recognizing that control over semiconductor technology could determine future military and economic dominance.