Taiwan targets silicon photonics, quantum tech for growth

Taiwan is set to focus on silicon photonics to enhance its local economy, as said by Liu Chin-ching, head of the National Development Council (NDC).

During a legislative hearing on April 16, 2025 Liu emphasized the country’s strengths in the semiconductor sector as a basis for this initiative.

Silicon photonics uses silicon for optical transmission and is known for benefits such as low power consumption and long transmission distances.

Taiwan has also identified quantum technology and autonomous robotics as additional areas of economic potential.

🔗 Source: Focus Taiwan

🧠 Food for thought

1️⃣ Taiwan’s “shield” strategy builds on decades of semiconductor success

Taiwan’s approach to developing silicon photonics as an economic “shield” follows the same playbook that transformed it into a semiconductor powerhouse.

The government’s pivotal role in establishing the semiconductor industry through R&D funding and industrial parks in the 1980s created the foundation for today’s success 1.

When TSMC was established in 1987 as a “pure-play foundry,” it revolutionized the global chip industry by allowing companies to focus on design while outsourcing manufacturing, creating an entirely new business model 2.

This government-industry partnership model has consistently delivered results. Taiwan grew from a minor player to become the fourth-largest semiconductor producer globally by 2000, with revenues jumping from $14.3 billion in 1999 to $22 billion in 2000 1.

The silicon photonics initiative follows this proven pattern, with government prioritization complemented by industry action through the new 30-company Silicon Photonics Industry Alliance led by TSMC and ASE Technology 3.

2️⃣ Silicon photonics represents a strategic market opportunity amid AI’s energy challenges

Taiwan’s focus on silicon photonics addresses a critical pain point in the AI industry: the massive energy consumption of data centers.

Silicon photonics technology leverages light for data transmission, offering significantly higher bandwidth, lower latency, and reduced power consumption compared to traditional copper interconnects, which are key advantages as AI computing demands grow exponentially 4.

The market opportunity is substantial. The global silicon photonics market is projected to grow from $1.29 billion in 2022 to $8.13 billion by 2030, representing a 25.8% CAGR 5.