TAIPEI (TVBS News) — In a move that could reshape global technology supply chains, U.S. President Donald Trump is poised to announce new tariff rates on imported semiconductors, with selective exemptions for certain companies. The decision looms as Taiwan's chip industry finds itself increasingly squeezed between Washington's and Beijing's competing interests.
During a talk at National Taiwan University on Monday (April 21), Abraham Newman, co-author of the geopolitical analysis "Underground Empire," outlined Taiwan's semiconductor industry's dual role as both strategic leverage and potential Achilles' heel in America's arsenal of global economic influence. His assessment comes as industry leaders anxiously await Trump's tariff announcement.
"I think that, from the Taiwanese perspective, they have to be prepared for the fact that whether it's the United States or China, that their position in the global semiconductor production network opens them up for these types of vulnerabilities," Newman told the audience. "To think that they're just kind of in that old world of globalization is going to get them into trouble."
Newman highlighted the Trump administration's significant policy evolution beyond mere security concerns. "What the Trump administration today is they've layered on top of those export controls a set of tariffs which are not just about security, but there are much a broader kind of goal, which is rebalancing how supply chains work and where they're located," he explained.
Newman's book documents America's economic strategy transformation from narrowly targeted sanctions to sweeping trade measures that reshape entire industries. The semiconductor sector stands as the prime example of this policy shift. Taiwan occupies a uniquely vulnerable position in this changing landscape, with Taiwan Semiconductor Manufacturing Company (TSMC) producing advanced chips critical for everything from smartphones to missile systems. Taiwanese firms now find themselves delicately balancing escalating demands from both Washington and Beijing.
In the face of mounting pressure, Newman counseled a measured approach for Taiwan's semiconductor industry. "I think the most important thing is not to make dramatic action too quickly. The policy environment is highly uncertain, and we've watched the president of the United States basically change the policy on a daily basis to different countries," he cautioned.
Newman specifically warned against Taiwan making hasty concessions to appease Washington. "I am also very concerned that concessions that are made will not result in some kind of loyalty, where then the administration says you get a free pass because you made this investment. I think it will only produce a kind of dominance test, where it's like if you give in, then they'll be asked for more," he cautioned.
Instead of unilateral concessions, Newman advocated for a coalition-building strategy. "It's important for countries like Taiwan to reach out to other trading nations that are committed to openness. So, whether that's Japan, the European Union, South Korea, Australia, these are all countries that really face the same pressures of China on one side, the U.S. on the other, and they are all dependent on trade," he said.
Taiwan's semiconductor giants now confront a precarious balancing act amid intensifying superpower competition, a predicament that Newman's book "Underground Empire" situates within a broader global economic power struggle. The island's hard-won technological prowess has ironically positioned it as both an indispensable link in global supply chains and a potential pressure point in America's increasingly aggressive strategy to weaponize international economic networks for geopolitical advantage. ★
