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Taiwan moves to save chipmakers

$6bn bailout ahoy

Business security measures using SSL

The Taiwanese government is moving closer to a $6bn bailout of the country's chipmakers who are suffering from the credit crunch and falling prices for DRAM despite production cuts.

There are also rumours that the Taiwanese government could work with Japanese firms to help save its domestic chip business. Taiwan's ProMOS Technology Corp is reportedly talking to Japanese firms Micron or Elpida about a possible takeover helped by the Taiwanese government.

Taiwan's largest memory chip maker Powerchip said on Monday it was cutting costs and selling off some assets, in the hope it can survive without taking government money as long as conditions don't get any worse. The firm's chairman will give up his salary. The firm hopes prices will rebound in the second half of the year as production cuts start to bite.

The government has already announced a package of measures including micro-loans for small businesses and start-ups, investment in "green" technologies, interest subsidies for home loans, public construction projects, encouraging state funds to invest in the stock market and encouraging foreign and mainland Chinese investment.

In November the Ministry of Economic Affairs said the industrial production index was down 28.3 per cent on the same time last year. ®

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