The 44-year-old has been impressed with the quality of young Welsh players coming off the production line in the Swans' academy with the likes of Connor Roberts and Dan James included in his latest squad, while Joe Rodon and Declan John are also on the fringes.
Giggs has hailed the work Swans boss Graham Potter has done to get some homegrown players into his plans in the Championship this season having taken over in the summer.
However, the Manchester United legend is now looking for Cardiff to do the same to widen the pool of players he can select from.
Giggs told Wales Online: "It's never easy when a club goes down.
"He's [Potter] doing a great job but what has been missing which helped Swansea when they were doing really well at the start is Welsh players. They had Ben Davies, Joe Allen. Now they have got that back.
"Hopefully they are getting their heart and soul back because I think it's important to have local players. We just need Cardiff to start doing that now!"