Taiwan says it has enough water to keep chip makers humming amid worst drought in decades
- The government expects rain in 2021 to be slightly less than usual
- TSMC sees no impact on production so far and says it has a contingency plan
Taiwan offered reassurances Monday it has sufficient water reserves to keep a giant tech industry led by Taiwan Semiconductor Manufacturing Co (TSMC) humming till late May, when monsoon rains arrive to alleviate its worst drought in decades.
The island should have enough water to supply the public and industry till then though precipitation is likely to fall short of average historical levels, Minister of Economic Affairs Wang Mei-hua told reporters Monday. The drought has so far exerted no impact on TSMC nor other companies, Wang added.
Taiwan faces its worst drought in 56 years, a challenge to water-intensive sectors of the economy from chip makers to textile factories and farms. The heightened level of concern coincides with a global shortage of semiconductors that is halting output at automakers from General Motors Co to Volkswagen AG, spurring TSMC and its peers to run their fabs at close to full capacity to try and sate demand.
On Sunday, President Tsai Ing-wen said on her Facebook page her government will do everything in its power to stabilise supply. Chipmaking consumes enormous quantities of both power and water. US, Japanese and European officials have urged the Taiwanese government to do all it can to ensure a steady supply of chips as automakers in their countries delay production and idle plants due to a lack of crucial components.
Spanning the Tropic of Cancer in the western Pacific Ocean, Taiwan typically receives copious amounts of rainfall. But last year was abnormally dry by historical standards. Hsinchu City, home to the likes of TSMC and MediaTek Inc, received just half the amount of rain in 2020 than it did the year before. The southern city of Tainan, another major centre of technology manufacturing, also saw a significant drop-off in the amount of rain.
About 70 per cent of Taiwan’s water supply goes toward agriculture while industrial production uses just 20 per cent. The remainder is for residential and commercial use, Taiwan’s Water Resources Agency Deputy Director-General Wang Yi-fung said in an interview Monday.