TAIPEI (Taiwan News) — Investment from Taiwan to China has plunged significantly over the years amid a recalibration of supply chain strategies due to the U.S.-China trade conflict and COVID-19, said a top official on Tuesday (Sept. 13).

Taiwanese investment in the world’s second-largest economy plummeted from US$10.97 billion (NT$341 billion) in 2015 to US$5.86 billion in 2021, according to Vice Premier Shen Jong-chin (沈榮津). He was addressing a forum on strategic planning for industries via a video.

Shen said the 47% decline can be attributed to companies diversifying production due to China’s relentless lockdowns and forced suspension of factory operations caused by power cuts. Comparatively, Taiwanese investment in the U.S., Vietnam, and Singapore has increased by 6.2%, 6.6%, and 2.7%, respectively, per CNA.

Taiwan’s semiconductor prowess has been accentuated amid the pandemic because the sector boasts advanced technologies and a resilient supply chain where activities thrive from the upstream to the downstream, according to Shen.

He added the country has over 200 IC design companies, 10 contract chipmakers, and 30 IC packaging and testing firms, which contribute to a vibrant semiconductor ecosystem. This has helped draw the investment of semiconductor equipment manufacturers including Merck and ASML, Shen said.