HSINCHU, Taiwan -- For the second time in two months, Taiwan is being hit by a water shortage as a drought spreads over the country. But the electronics supply chain has been spared, at least for the moment.
The government has begun cutting water supplies in the three cities of Taoyuan, Miao-li and Jia-yi for swimming, car washing and other activities that are not regarded necessary for everyday lives. Water at the Shihmen Reservoir, the biggest reservoir in the north, has dropped to the alarming level of about 200 meters, compared with 220 meters in the same period last year, according to the Central Weather Bureau.
However, the home of Taiwan's electronics supply chain hasn't been affected, at least not yet. The Paoshan Reservoir is offering 130,000 tons of water per day to the Hsinchu Science-based Industrial Park as the reservoir has received rainfalls in its mountain areas, authorities said. That's 30,000 tons more than needed by the park, which houses suppliers of chips, laptop PCs, TFT-LCD panels and electronics components.
"We don't think it's a serious problem," said Jesse Chou, a spokesman of Taiwan Semiconductor Manufacturing Co. Ltd., the No.1 pure-play foundry worldwide. "The authorities have said they have enough water supply for the Park through end of May."
In March, Taiwan adopted an emergency package aimed at keeping production at the island's electronics manufacturers from drying up. The package has worked so far, but concerns about a water shortage are mounting due to a lack of rain this month, when the government had hoped for rainfall since April is a rainy month, typically.
"We're very worried about the situation," said George Wu, an analyst at Primasia Securities Co. in Taipei. "It would be a disaster if the shortage forced TSMC and United Microelectronics Corp. in the future to halt shipment to Nvidia Corp., Advanced Micro Devices Inc., Texas Instruments Inc. and other customers."
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