Taiwan expects limited effects from US tariffs amid strong semiconductor sector

Taiwan anticipates only a limited effect from any tariffs set by the incoming administration of U.S. President-elect Donald Trump on semiconductor exports due to their technological edge, Economy Minister Kuo Jyh-huei stated on Friday. As the home to the largest contract chipmaker in the world, Taiwan Semiconductor Manufacturing Co. (TSMC), the island plays a vital role in the international technology supply chain for firms like Apple and Nvidia.

However, Taiwanese officials have cautioned that new U.S. tariffs under the Trump administration against all nations could hinder economic growth this year for the export-reliant economy. Trump has vowed a uniform tariff of 10% on global imports into the United States, along with a significantly higher 60% tariff on Chinese products. In late November, he explicitly promised a 25% tariff on imports from Canada and Mexico upon taking office on Jan. 20.

When asked during a news conference about the effect of Trump’s tariffs on Taiwan’s export orders, Kuo responded that it would not significantly influence the chip industry. “In terms of our semiconductors and advanced manufacturing processes, we possess a technological edge that cannot be duplicated, so the effect will be minimal,” he stated.

Kuo stated that Taiwan will assist companies in relocating supply chains to the U.S. when necessary, especially from regions with potentially high import tariffs. “Currently, we believe we can cultivate the aerospace supply chain industry in the U.S. and collaborate with American aerospace firms, allowing some of Taiwan’s aerospace research and development facilities to be transferred there.” He also mentioned that Taiwan plans to establish an office in Japan in the first half of this year to support Taiwanese investments there and to collaborate with Japan on AI and drones.