Opening Remarks

German chemical giant BASF announced today that it has signed a Letter of Intent (LOI) with Taiwan's Ministry of Economic Affairs to expand its Guanyin plant in Taoyuan. This expansion aims to support sub-2nm semiconductor manufacturing processes, providing a major boost to Taiwan's chip supply chain. Today, in "AI International News Express," Mu-Yen will not only focus on this critical investment but also analyze the US Congress's warning regarding routine patrols by the Chinese Coast Guard east of Taiwan. Additionally, why did Saudi Arabia's "Davos in the Desert" forum suddenly get canceled at the last minute? We will cover that shortly.

Today's Global Focus

1. German Chemical Giant BASF Expands in Taiwan, Signing LOI to Support Sub-2nm Semiconductor Processes

• What Happened: German chemical giant BASF signed a Letter of Intent (LOI) with Taiwan's Ministry of Economic Affairs, announcing the expansion of its electronic materials plant in Guanyin, Taoyuan. This expansion will boost the production capacity and quality analysis capabilities of advanced semiconductor materials, while also expanding its R&D center in Taiwan. The investment aims to support the strong global demand for sub-2nm advanced process chip technology. According to BASF's official press release, this move will help strengthen the resilience of the semiconductor supply chain in the AI era.
• Why It Matters: As global demand for AI and high-performance computing (HPC) skyrockets, 2nm and more advanced processes have become a critical battleground for major chipmakers. This collaboration demonstrates the strong support of a major international materials supplier for the development of advanced process technologies.
• Taiwan's Perspective: This collaboration not only deepens Taiwan's R&D connections with international chemical giants but also further solidifies Taiwan's indispensable strategic hub position in the global advanced semiconductor manufacturing ecosystem.
• Source: BASF (https://www.basf.com/global/en/who-we-are/news-and-media/news-releases/2026/10/basf-signs-letter-of-intent-with-taiwan.html)

2. US Congressional Official Warns: Routine Patrols by Chinese Coast Guard East of Taiwan Are Highly Destructive

• What Happened: Randall Schriver, Chairman of the US-China Economic and Security Review Commission (USCC), pointed out at a forum in Taipei that the routine patrols conducted by the Chinese Coast Guard in the waters east of Taiwan since June this year are "highly destructive." According to a report by The Straits Times, Taiwanese officials believe this move is an exercise by Beijing, utilizing military, paramilitary, and civilian assets to prepare for a potential future maritime blockade. Schriver emphasized that this is an extension of Beijing's legal, political, and information warfare against Taiwan.
• Why It Matters: The waters east of Taiwan were previously regarded as a defensive rear and a vital shipping lane. The introduction of routine patrols by the Chinese Coast Guard disrupts the existing tacit understanding of security, making the regional geopolitical situation increasingly complex.
• Taiwan's Perspective: This move directly threatens the safety of shipping lanes east of Taiwan and the defensive deployments in surrounding waters. Taiwan's national security agencies and military must reassess the allocation of maritime law enforcement and defense resources.
• Source: The Straits Times (https://www.straitstimes.com/asia/east-asia/chinese-patrols-to-taiwans-east-are-destabilising-us-congress-appointed-official-says)

3. Arda, an AI Manufacturing Startup Founded by Former OpenAI Research Head, Raises $230Millionata230\; Million\; at\; a$1.5 Billion Valuation

• What Happened: Arda, an AI manufacturing software startup founded by former OpenAI Research Chief Bob McGrew, has successfully raised $230millioninitslatestfundinground,bringingthecompan{y}^{\mathrm{\prime }}svaluationto230\; million\; in\; its\; latest\; funding\; round,\; bringing\; the\; company\text{'}s\; valuation\; to$1.5 billion. According to a CNBC report, the AI software developed by the company aims to automate parts of the manufacturing process and has already been adopted by defense technology company Anduril. This technology can drastically reduce the time required to reconfigure automated production lines, which typically takes three to six months.
• Why It Matters: The deep integration of manufacturing automation and AI is reshaping global supply chains. Arda's technological breakthrough demonstrates how AI can directly enhance the flexibility and production efficiency of physical manufacturing.
• Taiwan's Perspective: For Taiwanese companies known for precision manufacturing and supply chain expertise, AI technologies that can significantly shorten production line reconfiguration times will be critical tools for enhancing global competitiveness and supply chain resilience in the future.
• Source: CNBC (https://www.cnbc.com/2026/10/20/former-openai-research-chief-raises-230m-for-ai-manufacturing-startup.html)

4. Continuous Houthi Attacks Lead Saudi Arabia to Cancel 2026 "Davos in the Desert" Investment Forum

• What Happened: Saudi Arabia announced that the 2026 Future Investment Initiative (FII) forum, commonly known as "Davos in the Desert" and originally scheduled for October 26 to 29, has been postponed to 2027. According to an Al Jazeera report, the Saudi government made this decision primarily due to ongoing deadly attacks on the country by Yemen's Houthi movement. Officials emphasized that the postponement is to ensure the forum can achieve its expected scale and international impact in the future.
• Why It Matters: This forum is an important platform for Saudi Arabia to attract foreign investment and drive its "Vision 2030" economic transformation. The postponement will directly impact the pace of investment and collaboration in the local financial, technology, and energy sectors globally.
• Taiwan's Perspective: Taiwanese companies seeking Middle Eastern capital or planning projects in Saudi Arabia, such as green energy and smart cities, will face adjustments to their investment timelines and partnership negotiations.
• Source: Al Jazeera (https://www.aljazeera.com/news/2026/10/20/saudi-arabia-cancels-2026-davos-in-the-desert-amid-houthi-attacks)

5. Transboundary Haze Crisis Worsens in Southeast Asia: Malaysia Closes Schools, Singapore and Philippines Extend Flight Suspensions

• What Happened: Due to intentional land clearing for agriculture in Indonesia, transboundary haze has once again swept across Southeast Asia, leading to school closures in parts of Malaysia due to deteriorating air quality. According to an Al Jazeera report, Singapore is currently suffering from hazardous air pollution and has issued preventive notices to Indonesian companies suspected of starting the fires. Meanwhile, Cebu Pacific and Philippine Airlines have announced extensions of flight suspensions for certain routes until October 31.
• Why It Matters: Transboundary haze is a long-standing, unresolved environmental and diplomatic dispute in Southeast Asia. This widespread pollution not only threatens the health of millions of residents but also inflicts tangible economic losses on regional tourism, aviation, and business activities.
• Taiwan's Perspective: This severe public health and transportation crisis will directly impact Taiwanese citizens planning to travel or conduct business in Singapore, Malaysia, and the Philippines. Travelers need to pay close attention to flight adjustments and personal health protection.
• Source: Al Jazeera (https://www.aljazeera.com/opinions/2026/10/20/southeast-asias-haze-crisis-will-persist-until-polluters-pay)

6. France Imposes Partial Curfews Following Weekend Clashes: Nighttime Security Tightens in Central Paris

• What Happened: The French government has imposed partial nighttime curfews in central Paris, including the Place de la République and the Les Halles shopping district, as well as several other cities. This measure aims to quell nationwide clashes and social unrest that escalated from student protests over school conditions and were joined by labor unions. According to a BBC report, French Prime Minister Sébastien Lecornu stated that the curfew policy has successfully restored calm to the nights following the clashes.
• Why It Matters: As a major European tourism and business hub, Paris's security situation directly affects France's social order. The implementation of partial curfews reflects the government's balancing act between maintaining public safety and protecting the right to assemble.
• Taiwan's Perspective: This shift in the security situation means that Taiwanese citizens planning to travel, study, or conduct business in Paris, France, must pay special attention to nighttime safety regulations and local traffic control measures.
• Source: BBC News (https://www.bbc.com/news/articles/cx30ez03djyqo)

Closing Remarks

From BASF deepening its roots in Taiwan's semiconductor industry to the transboundary haze in Southeast Asia and partial curfews in France, global geopolitical and environmental shifts are closely impacting our lives. Over the next few days, we will continue to monitor the subsequent effects of the Middle East security situation on global capital flows, as well as how Southeast Asian nations work together to address this haze crisis. I am Mu-Yen, and I will see you tomorrow.