Taiwan says Trump can’t pressure it into giving up half its chip supply

Taiwan has firmly rejected recent claims suggesting it would shift half of its semiconductor production to the United States. Vice Premier Cheng Li-chiun clarified that such a move had not been considered during recent trade discussions, countering assertions made by U.S. Commerce Secretary Howard Lutnick. Lutnick had implied that Taiwan might contemplate relocating a significant portion of its chip supply chain to secure a security guarantee from the U.S., especially given the looming threat of a potential Chinese invasion. Since taking office, former President Trump has emphasized the importance of reshoring semiconductor supply chains for both economic and national security reasons. Lutnick's comments indicated that Taiwan should accept these unusual conditions due to its reliance on U.S. protection. However, Cheng stated on Wednesday that while there has been 'certain progress' in trade negotiations, Taiwan has made 'no such commitment' regarding the relocation of its chip production and clarified that this topic was not on the table in the current talks. The focus of the discussions has primarily been on concessions related to the Section 232 investigation initiated by Trump, which examines the implications of imposing tariffs on semiconductors and related products. Taiwan is a vital player in the global semiconductor industry, producing approximately 95% of the chips used in popular technology products. Notably, over 70% of Taiwan’s exports to the U.S. fall within the semiconductor category and are therefore under scrutiny in this investigation. The semiconductor investigation, which began in April, has faced delays, with the Trump administration hinting that tariff decisions could be imminent. Meanwhile, Ed Brzytwa, vice president of international trade at the Consumer Technology Association (CTA), noted that U.S. tech companies are actively preparing for potential increases in import costs by stockpiling products, all while striving to keep consumer prices stable. Industry players are also keeping a close eye on administration leaks regarding possible tariffs, but the specifics of how these tariffs would be implemented remain unclear, especially concerning products containing multiple chips or critical minerals that may also incur tariffs.