TSMC's deal with the US marks the firm's biggest foreign investment, but Taiwanese officials aren't happy with the development, claiming that this would result in a technology transfer.
Taiwanese Lawmakers Say TSMC's Investment In The US Is A "Forced Deal" With No Security Or Tariff Exemption Assurances
For those still unaware, TSMC has recently pledged to invest $100 billion in the US, opening four new facilities in Arizona, along with an advanced packaging and R&D center. The deal, signed in the Oval Office, is an attempt by TSMC to escape the influence of "Trump tariffs," which were expected to be well over 100%. While this deal has bolstered the US's domestic chip industry, concerns have been raised in Taiwan, with officials now saying that TSMC showing focus towards the US means that the nation will lose its chip dominance, ultimately compromising the entire supply chain.
According to a report by UDN, Taiwanese lawmakers have expressed that despite the TSMC deal with the US, there are no assurances that the US will exempt tariffs on Taiwan. Moreover, it is also claimed that the Trump administration has provided no guarantee of "security" from Taiwan's regional threats, which means that the TSMC deal is just a forced one. A technology transfer to the US would mark the start of a slow demise of Taiwan's chip industry, given that this segment is why Taiwan holds such immense importance in the eyes of global powers.
However, TSMC has assured Taiwan that their ambitious expansion to the US won't downgrade the country's importance in the chip supply chain, claiming that core technology will remain in the country. TSMC Taiwan has an R&D team far larger than it has in nations like the US. Not only this, but all the cutting-edge node production will be confined to Taiwan fabs, with other nations being responsible for previous generations. TSMC has also announced plans to open up four new facilities in Taiwan, showing their dedication towards the country.
There's no doubt that the supply chain will become much more diverse following TSMC's expansion into the US, and ultimately, Taiwan won't be the sole producer of mainstream semiconductors. It will be interesting to see how TSMC's future shapes up in the US, given that with the current administration, they are required to commit too much, which is why Taiwan is concerned.
