US Reduces Tariffs as Taiwan Bolsters Investment in Chip and AI Production
TAIPEI: Taiwan is poised to enhance its strategic alliance with the United States in the realm of artificial intelligence following a recent agreement that includes tariff reductions and increased Taiwanese investment, announced Taiwan’s Vice Premier Cheng Li-chiun on Friday.
The prior Trump administration had urged Taiwan, a significant player in the semiconductor industry, to amplify its investments within the U.S., particularly in the semiconductor sector that fuels the burgeoning field of AI technologies.
The newly minted trade agreement, finalized on Thursday, lowers tariffs on an array of exports from the semiconductor titan and directs fresh capital towards the American technology sector. However, this move may provoke discontent in China, which regards Taiwan as its sovereign territory.
Taiwanese enterprises are set to inject a staggering US$250 billion to enhance production capabilities in semiconductors, energy, and artificial intelligence on U.S. soil.
This financial commitment includes US$100 billion from chip manufacturer TSMC, earmarked for 2025, with additional investments anticipated, as highlighted by U.S. Commerce Secretary Howard Lutnick.
Further, Taiwan will extend an extra US$250 billion in credit guarantees to facilitate this ambitious investment strategy, according to statements from the Trump administration.
Cheng, who spearheaded the negotiations on behalf of Taipei, characterized the agreement as mutually beneficial and expressed optimism that it would foster greater U.S. investment in Taiwan, its most significant international ally and arms supplier.
“Through this negotiation, we have promoted reciprocal high-tech investment between Taiwan and the U.S., aspiring to establish ourselves as close strategic partners in AI in the future,” Cheng articulated during a livestreamed press conference.
This investment strategy is predominantly driven by companies rather than governmental initiatives, Cheng affirmed, noting that Taiwanese businesses would continue to cultivate their interests domestically.
“We view this supply-chain cooperation as a means to ‘build’ rather than simply ‘move.’ We are expanding our presence in the U.S. while simultaneously supporting the development of local supply chains, thus creating an extension of Taiwan’s technological prowess,” she elaborated.
In a separate address to the press in Taipei, Taiwan’s Economy Minister Kung Ming-hsin emphasized that investments would encompass AI servers and energy sectors. He remarked that the specific allocation toward semiconductor-related initiatives would ultimately depend on corporate announcements.
Responding to the agreement, TSMC expressed its enthusiasm for “robust trade agreements” between the U.S. and Taiwan in a formal statement.
“With respect to TSMC’s investment strategies, we observe strong market demand for our advanced technologies. We intend to maintain our investments in Taiwan while also expanding internationally, all driven by market dynamics and client requirements,” the statement concluded.
Source link: International.astroawani.com.
