China is stepping up efforts to pilfer semiconductor-related know-how and experienced workers from Taiwanese companies, reports Reuters, citing Taiwan's top security agency. The report claims that external restrictions on shipping advanced fab tools and other technology to the People's Republic of China are among the reasons why the mainland is attempting to grab those resources from the island nation.
China is targeting Taiwan's semiconductor ecosystem to gain access to advanced chip manufacturing technology and skilled talent in a bid to bypass those international restrictions, according to Taiwan's National Security Bureau. In particular, China uses indirect methods — front companies, recruitment schemes, and covert channels — to poach engineers, obtain sensitive know-how, and even procure restricted fab tools, the NSB claims.
Taiwan is famously home to TSMC, the world's largest and most advanced contract chipmaker, which produces chips using 2nm-class fabrication technologies in high volume. By contrast, China-based SMIC can only mass produce chips on 7nm-class nodes, which are at least two generations behind TSMC's technologies.
The PRC cannot get sophisticated tools from Europe and the U.S. to develop its own advanced manufacturing processes and use them for high-volume production. As a result, the efforts of Chinese companies and even government-linked entities to steal technologies, talent, or restricted pieces of equipment will inevitably continue. Even as far back as the 2000s, international courts found SMIC guilty of illegally obtaining fabrication technologies from TSMC, so the Chinese foundry had to pay the Taiwanese company compensation.
Nowadays, it is close to impossible to steal the secrets of a semiconductor manufacturing process without stealing the fab itself, so Chinese attempts to obtain Taiwanese chip-making know-how are getting more sophisticated and involve the poaching of engineers, among other things, according to the NSB. As a result, Taiwan continues to strengthen legal and regulatory barriers to prevent technology transfer, illicit recruitment, and espionage network activity from operating in the country.
According to the report, Taiwan's National Security Bureau claims that cyber activity against its sensitive assets remains intense. More than 170 million intrusion attempts against Taiwan's Government Service Network were recorded in the first quarter alone. Military pressure around Taiwan is rising, too. In the first quarter of 2026, more than 420 Chinese aircraft operated near the island, alongside naval forces that carried out 10 coordinated combat-readiness patrols. Those tensions, in addition to the covert operations, recruitment efforts, and illicit trading methods the report describes, will only continue to dog Taiwan as it continues its reign at the leading edge of semiconductor manufacturing.
