Drought hits Taiwan drive to plug global chip shortage
Taiwan’s drive to plug a global shortage of microchips has hit a snag — a lack of water for its foundries caused by a drought. Taiwanese high-tech chip foundries are some of the world’s biggest and most advanced, and European car manufacturers have been reaching out to Taipei for help.
Semiconductor shortages, caused by supply chain priorities changing because of the coronavirus pandemic, have forced some major manufacturers to suspend production lines. Taiwan has said it will try to ramp up production of chips but worsening water shortages could hamper its plans.
Under tougher restrictions imposed from Thursday, factories and industrial zones have to cut water use by up to 11 percent in some central and southern parts of the island.
Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract microchip maker, said it has initiated measures such as reducing water usage and trucking in water for some facilities this week as a test run to prepare for “possible future needs.”
“So far there is no impact on production and we are monitoring the water supply situation closely,” the company said in a statement.
TSMC has said the auto industry was a top priority but warned its factories were already at full capacity.
A science park in northern Hsinchu city said other semiconductor companies were making similar preparations for water restrictions.
The dry spell came as no typhoons made landfall in Taiwan last year for the first time in 56 years.
Water levels in some reservoirs are at below 20 percent, and the central weather bureau predicts “drier than usual” weather for this month and next.
The government has “prepared for the worst,” said economic affairs minister Wang Mei-hua, as an “orange alert” has been issued to limit total water use and reduce water pressure in some cities.
Activity in Saudi Arabia’s elevator and escalator market went down by 8.4 percent in 2020 due to the pandemic slowing down construction, but experts believe it will rebound quickly as delayed projects restart and the megaprojects announced as part of Vision 2030 come to fruition.
According to the latest report by global consultancy firm TechSci Research, the Saudi Arabia elevator and escalator market is expected to recover in the short term and be worth $1.34 billion by 2025, compared to $961.70 million in 2020. This growth is “owing to the increasing construction activities, development of infrastructure, rising number of multi-story commercial and residential buildings and skyscrapers, growth in the real estate sector and technological advancements in the elevator industry,” the report said.
The report added that increased foreign direct investment into the Kingdom’s retail and construction sectors was indirectly boosting the market for escalators and elevators.
While the number of construction contracts in Saudi Arabia declined in 2020, many real estate experts believe the market will make a quick recovery.
“Whilst the total value of new contracts has decreased, the level of activity underway in Saudi Arabia still remains high compared to previous years and considering new financing
agreements signed during the course of 2020, particularly those relating to urban and real estate development, we expect new contracts activity levels to begin to return to pre-pandemic highs in 2021,” Taimur Khan, an associate partner at real estate consultancy Knight Frank, told Arab News in December.