“Authored by Wen-Yee Lee

An illustrative image showing a small figurine of a worker placed among printed circuit boards with semiconductor chips – a symbol of Taiwan’s thriving technology industry.

The technological and economic sectors of Taiwan could face a significant cut in funds, specifically in the areas of semiconductors, artificial intelligence (AI), and aerospace, according to the country’s science ministry. The announcement on Friday indicated that next year’s funding could be slashed by as much as T$20 billion ($609.11 million) due to new legislation.

The reduction in funding comes as a result of laws recently passed by Taiwan’s opposition parties who hold a majority in the parliament. These laws aim to reroute funds from the central government to local municipalities. This legislative change has faced strong opposition from the ruling Democratic Progressive Party (DPP) and numerous protestors.

Following the warning from Taiwan’s Ministry of Science and Technology, the Ministry of Economic Affairs echoed similar concerns earlier this week. It pointed out that the country’s alliances with tech giants like Micron, AMD, and Nvidia could be impacted. Furthermore, it was suggested that the potential deficit in future budgets could hinder Taiwan’s global partnerships in AI technology.

The economic ministry has projected a T$29.7 billion reduction in its spending for the upcoming year. It is estimated that T$11.6 billion of this amount will be deducted from technology projects.

Micron, a major player in the tech industry, has been Taiwan’s largest foreign direct investor. Along with AMD and Nvidia, Micron has applied for tech collaboration projects with the Taiwanese government, with the expectation of partial government funding support.

For reference, the current exchange rate stands at $1 equivalent to 32.8350 Taiwan dollars.”