Taiwan to Respond to Potential Semiconductor Tariffs as Deputy Minister Visits the US

Taiwan's Economic Deputy Minister Heads to Washington to Address US Tariff Concerns

Taiwan is preparing to address the looming threat of new tariffs on its semiconductor industry as the Trump administration signals the potential for imposing such measures. The island nation, home to some of the world's largest semiconductor manufacturers such as TSMC, is on high alert over these developments. On February 8th, 2025, Taiwan’s Economic Minister, Kuo Zhi-Hui, confirmed that a high-level delegation from Taiwan's Ministry of Economic Affairs (MOEA), led by Deputy Minister Zhang Yuan-Luo, will visit Washington D.C. next week to engage with US officials. This trip is particularly aimed at addressing concerns related to allegations that Taiwan has been involved in stealing US semiconductor technology.

Taiwan, with its pivotal role in the global semiconductor supply chain, is especially concerned about the potential impact of tariffs on its thriving chip manufacturing industry. The country accounts for around 98% of the world’s advanced semiconductor production. The Taiwanese government has reiterated its commitment to the US, describing Taiwan as one of America’s strongest trade partners, and clarified that it has never engaged in intellectual property theft regarding semiconductor technologies. Kuo emphasized that when Taiwan acquired integrated circuit (IC) technology from RCA, it paid the necessary intellectual property fees as required.

The escalating concerns come in response to statements made by former President Donald Trump, who, during a speech to Republican House members on January 27, 2025, suggested that the US may impose tariffs on foreign-made computer chips, semiconductors, and pharmaceuticals. Trump’s comments specifically singled out Taiwan, saying that Taiwan’s dominance in the semiconductor sector has led to the departure of US semiconductor companies. He voiced hopes for these companies to return to the US, stressing the importance of revitalizing the US semiconductor industry.

To counter the possible tariffs, Taiwan has been considering various strategies, including increasing its energy imports from the United States. Taiwan's major suppliers of liquefied natural gas (LNG) currently include Australia and Qatar, but Taiwan may shift to sourcing more energy from the US, following Japan’s example. This shift could provide Taiwan with a means of mitigating the economic impact of additional tariffs, helping to protect its semiconductor industry and broader economy.

Experts also warn that if Taiwan faces additional tariffs, it could be forced to accelerate its plans to relocate production lines to other countries and increase investments within the US. Some have speculated that if tariffs are imposed solely on Taiwan, it might have to adopt similar tariff rates as other industrial competitors like South Korea and Japan.

With both sides bracing for potential economic repercussions, Taiwan’s delegation is expected to work closely with US officials to clarify any misunderstandings and ensure the continuation of strong economic relations between the two countries. The upcoming discussions will be pivotal in shaping the future of US-Taiwan economic cooperation, particularly in the vital semiconductor sector.