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A Taipei resident waving the Taiwanese flag during a demonstration during the last presidential election. REUTERS / Ann Wang

If mainland China suffers from the trade war waged with the United States, Taiwan benefits. Factories and investments hitherto concentrated on the continent returned to him. And the outgoing president is not for nothing. It has implemented an incentive policy to attract investment in new technologies, in which Taiwan is already a key player.

TSMC, Quanta Computer, Pegatron, Honhai, names that don't always say much. However, these are Taiwanese electronics giants whose main customers are called Apple or Huawei. All of them opened factories in mainland China many years ago, attracted by low production costs. But things are changing. Besides the fact that China is no longer as competitive, the trade war and its effects have prompted many Taiwanese companies to withdraw part of their investments.

The American “boost”….

The additional tariffs imposed by the Trump administration on Chinese exports have accelerated the movement. American customers like Dell and Intel prefer to see the production of computer servers in Taiwan, where computer security is more guaranteed than in China.

TSMC, the undisputed world leader in the foundry of semiconductors, central in the production of smartphones in particular, has planned to invest $ 15 billion in 2019, notably for the opening of several factories.

In all, in 2019, more than $ 22 billion was repatriated by Taiwanese companies to the island, according to government figures.

Google invests $ 26 billion

Several other large groups such as Hon-Hai, which supplies components for Apple, answered the call from President Tsai Ing-wen . Because it is his voluntarism that also allows this return movement. At the end of 2018, it launched an ambitious action plan to encourage the repatriation of Taiwanese investments on the island (" Action Plan for Welcoming Overseas Taiwanese Business to Return to Invest in Taiwan"). Easy access to land, to credits, are deployed to primarily attract the semiconductor industry of which Taiwan is a world leader.

Foreign investors benefit. Google has committed $ 26 billion in 2019 to expand its data center on the island.

5G as an ally

The development of 5G phones puts Taiwan more than ever at the center of the world when it comes to manufacturing chips and semiconductors. Even if it is not the only producer, its technological advance concerning the manufacture of ever smaller and more efficient chips (5 nanometers, 3 nanometers) makes it essential. Including for Chinese phone manufacturers. Huawei is the second TSMC customer after the American Apple. The outgoing president made it one of the primary arguments to defend the interests of Taiwan against the assaults of Beijing. An issue of sovereignty and independence.