(ELI5) What is it about Taiwan that makes it a good spot to produce computer chips?
In: 13
Intense prior investment.
High tech manufacturing really relies on having an experienced workforce and well developed facilities. Both of those require time and money.
Many companies offloaded their electronics manufacturing into Taiwan due to cheaper labour and utilities in the past. Now Taiwanese companies have the people, the knowhow, the facilities and the money to both do what others do but cheaper (due to economy of scale and experience) AND innovate beyond that.
To catch up, others need to put in exactly as much human and monetary investment as Taiwan already had to this date, but most likely without seeing profit for decades (because they can buy from a cheaper, trustworthy source, i.e. Taiwan).
Of course, it still is worth doing by nations for matters like supply independence etc. But business-wise, it makes sense to buy from Taiwan.
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