Taiwan’s success in the semiconductor industry has placed the island at the heart of the global AI revolution, creating new opportunities but also raising questions about the durability and inclusiveness of its economic and strategic advantages. Can Taiwan translate its technological significance into greater security while ensuring that its energy infrastructure and wider industrial base keep pace? This special issue explores these interconnected challenges.
In her first article, Pamela Kennedy asks whether the global AI boom will deliver lasting strategic benefits for Taiwan. She considers how fluctuations in chip demand and US efforts to diversify production capacity could weaken the incentives underpinning Taiwan’s AI shield, while highlighting the importance of developing broader international partnerships.
Scott M. Moore’s second article shifts attention to the energy infrastructure behind Taiwan’s technological prominence. He examines how rising AI data-centre demand exposes weaknesses in grid capacity and distribution, while imported-fuel dependence, slow renewable development, and public concerns about electricity prices complicate the island’s energy outlook.
Sin Lee and Chan-Yuan Wong finally turn to the domestic consequences of technological and environmental change. They show how smaller firms may struggle to meet growing sustainability requirements and adopt AI, thus widening the gap between large corporations and small and medium-sized enterprises. They propose targeted support to help firms remain competitive and participate in industrial upgrading.
Together, the contributions highlight the importance of linking Taiwan’s technological ambitions with energy resilience and more inclusive industrial development.
Supply and Demand: Taiwan’s AI Shield Conundrum Written by Pam Kennedy