WASHINGTON--Japan, the United States, South Korea and Taiwan are considering a new coordinated framework to help ensure a stable supply of chips as a bulwark against China's semiconductor industry. 

The arrangement, known as the "Chip 4 Alliance," has surfaced as a global shortage of semiconductors raises concerns about economic security against China.

Bi-khim Hsiao, Taiwanese representative to the United States and de facto ambassador, acknowledged that preparations are being made behind the scenes toward a policy coordination by the four major semiconductor players.

“We have been engaging in preliminary discussions on this,” she said in an interview with The Asahi Shimbun in Washington on Sept. 8.

The interview was the first for Hsiao to speak with a Japanese news outlet after Nancy Pelosi in August became the first U.S. House speaker to visit Taiwan in 25 years.

Taiwan is the global leader in semiconductors, with Taiwan Semiconductor Manufacturing Co. the world’s largest contract chipmaker.

Combined with Japan, the United States and South Korea, the Chip 4 Alliance represents more than 70 percent of the value of the global semiconductor industry.

But details about the inner workings of the alliance have remained under wraps.

The alliance can serve as a venue where the four parties will coordinate their industrial policies, including the provision of subsidies, and control of exports to China.

As the confrontation with Beijing deepens, Washington is apparently aiming to secure a stable supply of chips, which is essential to maintaining its competitive edge both in military and commercial technology, by leading an initiative to form a new policy coordination with other major chip players.

On Sept. 9, Japan, the United States and 12 other countries decided to enter official negotiations for the U.S.-led Indo-Pacific Economic Framework for Prosperity (IPEF), with strengthening supply chains for semiconductors as a top agenda.

But Taiwan, which accounts for 90 percent of the global production of the most sophisticated chips, is not a member to the IPEF.

The Chip 4 Alliance can play a significant role by integrating Taiwan into a multilateral framework to prepare for a possible global chip crunch in the event of a contingency between Taiwan and China, according to analysts.

On the alliance, Hsiao said, “We're open to continuing these discussions and playing a constructive role in global supply chains.”

The representative said Taiwan is ready to invest further to bolster its chip industry and expand production through international collaboration, shown in the construction of TSMC’s new factory in Kumamoto Prefecture in Japan.

She added that having some discussion among governments about “how to best facilitate policies that will further support the continuing growth of the industry is a constructive project.”

Hsiao also said Taiwan will continue to seek membership in the IPEF as well as the Trans-Pacific Partnership (TPP) trade agreement. 

“We were disappointed that we were not included in the first round (of the IPEF),” she said. “Taiwan continues to seek, in addition to our bilateral economic partnerships, regional economic opportunities, such as CPTPP (TPP) and IPEF as well.”

On the issue of China, Hsiao blasted China for its strong reaction to Pelosi’s and other U.S. congressional delegations’ recent visits to Taiwan.

“It’s unfortunate that China has overreacted, and that it has taken very dangerous actions that are irresponsible and have a broader impact on the security and stability of the region as a whole,” she said, referring to East Asia.

She called on Beijing to exercise restraint and facilitate peaceful means and dialogue in resolving differences between Taiwan and China, while reiterating the island “is committed to the status quo.”

On U.S.-China relations, Hsiao described it as “very different from engagements they had 10 years ago.”

She said the two countries have lost venues for dialogues that previously existed on various levels after China’s decision-making structure has evolved under President Xi Jinping’s leadership.

But responding to a question on possible face-to-face talks between U.S. President Joe Biden and Xi in Indonesia in November at the Group of 20 summit, Hsiao said: “We have very close communication and a high degree of confidence with the U.S. side, so that their interactions with China take place with an understanding that it serves the interest of stability in the region, but also in continuing to protect our values and our shared interests.”

(This article was written by Ryo Kiyomiya and Hirotsugu Mochizuki, the chief of The Asahi Shimbun’s American General Bureau, in Washington.)