Taipei [Taiwan], October 1 (ANI): Taiwan has firmly ruled out agreeing to a deal with the United States that would require half of all semiconductor production to take place in the country, according to a Reuters report on Wednesday.
The proposed 50-50 production split, discussed by US Secretary of Commerce Howard Lutnick in an interview with US television network News Nation, would significantly shift global semiconductor manufacturing. The majority of such chips are currently produced in Taiwan, home to the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC).
Taiwan’s Vice Premier Cheng Li-chiun, who is leading the tariff talks with Washington, stated that the proposal was not part of the current negotiations. “Our negotiating team has never made any commitment to a 50-50 split on chips. Rest assured, we did not discuss this issue during this round of talks, nor would we agree to such conditions,” Cheng said upon returning to Taiwan.
Taiwan maintains a large trade surplus with the United States, and its exports to the US currently face a 20 per cent tariff. TSMC, benefitting from growing demand for artificial intelligence applications, is investing USD 165 billion to build chip factories in Arizona. However, the bulk of its production will remain in Taiwan.
Taiwan’s government said last month that talks with the United States achieved “certain progress,” with hopes for a more favourable tariff rate. Premier Cho Jung-tai told parliament on Tuesday that Vice Premier Cheng had engaged in multiple discussions with the US on tariff issues. Cheng confirmed that “detailed” talks had occurred, yielding progress.
Separately, Taiwan’s presidential office said President Lai Ching-te met with Luke J. Lindberg, Under Secretary for Trade and Foreign Agricultural Affairs at the US Department of Agriculture, underscoring ongoing bilateral trade dialogue.
This firm stance by Taiwan reflects its strategic importance in the global semiconductor supply chain and highlights the complexities of balancing trade negotiations with geopolitical and domestic economic priorities.
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