Cheng says tariff deal gives chipmakers preferential treatment
TAIPEI (Taiwan News) — Taiwan said it aims to lead a “democratic” high-tech supply chain with the US after securing a tariff deal to deepen cooperation on chips, Reuters reported Tuesday.
Vice Premier Cheng Li-chiun (鄭麗君) said the agreement positions Taiwan and the US as strategic partners in AI and advanced manufacturing. The deal follows talks concluded with Washington last week.
Under the deal, Taiwanese chipmakers expanding production in the US will qualify for lower tariffs on semiconductors and related equipment imported into the country, with some items eligible for duty-free treatment. Broader US tariffs on most other Taiwanese exports will fall from 20% to 15%.
Taiwanese companies will also invest NT$7.9 trillion (US$250 billion) in the US to boost semiconductor, energy, and AI production, while Taipei will provide an additional NT$7.9 trillion in credit guarantees to support further investment. Cheng said the arrangement strengthens Taiwan’s global footprint without weakening its domestic industry.
“This is not supply-chain relocation,” Cheng said, rejecting concerns that the deal would hollow out Taiwan’s chip sector, often described as the country’s “sacred mountain.” Instead, she said it allows Taiwanese firms to extend their technological strengths abroad “through addition, and even multiplication.”
The agreement grants chipmakers preferential treatment during US expansion projects, allowing them to import up to 2.5 times their new production capacity in chips and wafers without additional tariffs during approved construction periods. Taiwan has also secured advance preferential status under any future US Section 232 semiconductor tariffs, Cheng said.
US Commerce Secretary Howard Lutnick has warned that companies failing to build in the US could face tariffs as high as 100%, though final rates remain undecided. Cheng said Taiwan would receive the most favorable treatment under any future tariff scenario.
Taiwan is the world’s leading semiconductor producer and a key US partner despite the absence of formal diplomatic ties. TSMC produces about 90% of the world’s most advanced chips.
www.taiwannews.com.tw
TAIPEI (Taiwan News) — Taiwan said it aims to lead a “democratic” high-tech supply chain with the US after securing a tariff deal to deepen cooperation on chips, Reuters reported Tuesday.
Vice Premier Cheng Li-chiun (鄭麗君) said the agreement positions Taiwan and the US as strategic partners in AI and advanced manufacturing. The deal follows talks concluded with Washington last week.
Under the deal, Taiwanese chipmakers expanding production in the US will qualify for lower tariffs on semiconductors and related equipment imported into the country, with some items eligible for duty-free treatment. Broader US tariffs on most other Taiwanese exports will fall from 20% to 15%.
Taiwanese companies will also invest NT$7.9 trillion (US$250 billion) in the US to boost semiconductor, energy, and AI production, while Taipei will provide an additional NT$7.9 trillion in credit guarantees to support further investment. Cheng said the arrangement strengthens Taiwan’s global footprint without weakening its domestic industry.
“This is not supply-chain relocation,” Cheng said, rejecting concerns that the deal would hollow out Taiwan’s chip sector, often described as the country’s “sacred mountain.” Instead, she said it allows Taiwanese firms to extend their technological strengths abroad “through addition, and even multiplication.”
The agreement grants chipmakers preferential treatment during US expansion projects, allowing them to import up to 2.5 times their new production capacity in chips and wafers without additional tariffs during approved construction periods. Taiwan has also secured advance preferential status under any future US Section 232 semiconductor tariffs, Cheng said.
US Commerce Secretary Howard Lutnick has warned that companies failing to build in the US could face tariffs as high as 100%, though final rates remain undecided. Cheng said Taiwan would receive the most favorable treatment under any future tariff scenario.
Taiwan is the world’s leading semiconductor producer and a key US partner despite the absence of formal diplomatic ties. TSMC produces about 90% of the world’s most advanced chips.
Taiwan pledges to lead high-tech supply chain with US | Taiwan News | Jan. 20, 2026 16:50
Cheng says tariff deal gives chipmakers preferential treatment | Jan. 20, 2026 16:50
Last edited: