09.03.2001
TSMC to establish sales offices in China

• Development: TSMC recently said it is to set up sales offices in several major cities in China as the first step of its China investment strategy.

• Analysis: As far as the establishment of fabs in China is concerned, we believe there are issues which still need to be resolved both in Taiwan (investment restrictions) and China (market and infrastructure problems) before TSMC can effect a concrete plan.

• Primasia View: We believe TSMC’s China moves, if accelerated, could serve as a major catalyst to stock performance in 2H01, especially as China rolls out its new preferential policy promoting semiconductor manufacturing later this year. The last such policy (‘Guofa No. 18’) was announced in June 2000.