Wu Cheng-wen, Taiwan’s new technology minister, said smart machines connected to the internet, including chip tools, can be remotely shut off in the event of a conflict on the island.

Wu, stepping in to oversee science and technology as part of a new administration, was responding to a lawmaker’s question about a Bloomberg News report that chipmaking gear maker ASML Holding NV and Taiwan Semiconductor Manufacturing Co (TSMC) have the ability to disable the world’s most advanced chip machines remotely.

China on Thursday escalated military exercises around the island that Beijing considers part of its territory, only days after the self-governing democracy of 23 million inaugurated a new president in Lai Ching-te. Tensions in the Taiwan Strait have caused concern in the US and other leading nations about implications for the global economy - which counts on TSMC to produce the world’s most essential chips.

“According to today’s smart chip manufacturing technology, it can be done,” Wu said. “Whatever industry and machinery, if it is linked online, we can use this smart manufacturing technology to remotely control the machinery, including stopping it.”

Netherlands-based ASML provides TSMC with EUV - extreme ultraviolet lithography - machines that make it possible to produce the most powerful and energy-efficient chips today, including Nvidia Corp’s artificial intelligence (AI) accelerators. TSMC now manufactures 99% of the world’s AI accelerators, senior vice-president Kevin Zhang said in Hsinchu on Thursday. US-led trade sanctions prevent ASML from exporting such machines, which are seen as carrying critical geopolitical importance, to China.

Officials from the US government have privately expressed concerns to both their Dutch and Taiwanese counterparts about what happens if Chinese aggression escalates into an attack on the island responsible for producing the vast majority of the world’s advanced semiconductors, according to people familiar with the discussions. TSMC has bought more EUV machines than any other chipmaker since ASML first developed them in 2016. ASML has shipped more than 200 of these machines, which sell for over €200 million (US$217 million or RM1.02 billion) apiece.

ASML reassured officials about its ability to remotely disable the machines when the Dutch government met with the company on the threat, the people said, adding that the Netherlands had run simulations of a possible invasion in order to better assess the risks. 

  - Bloomberg