TAIPEI (TVBS News) — Taiwan's leading economic think tank has challenged former U.S. President Donald Trump's assertions about the island's semiconductor industry. Taiwan Institute of Economic Research (TIER, 台經院) President Chang Chien-yi (張建一) Monday (May 26) rejected Trump's claim that Taiwan Semiconductor Manufacturing Company (TSMC, 台積電) is stealing American chip production business. Chang pointed out that prominent American semiconductor companies — including Intel, Qualcomm, Micron, and Texas Instruments — have themselves requested tariff exemptions related to semiconductor imports.
The economic implications of potential tariffs extend beyond political rhetoric, according to Liu Pei-chen (劉佩真), an analyst from TIER's Taiwan Industry Economic Service. Liu explained that American technology firms clearly recognize TSMC's unique and irreplaceable position in the global semiconductor supply chain, which could force companies to absorb or pass along increased costs. This market reality, Liu suggested, motivated major U.S. chip designers like Intel, Qualcomm, Micron, and Texas Instruments to caution Trump against implementing semiconductor tariffs.
The economic analysis becomes more concrete when examining industry projections, Liu continued. She cited Semiconductor Industry Association (SIA) estimates indicating that even a modest 1% tariff increase would drive up wafer fabrication plant construction costs by 0.64%. This ripple effect could potentially add $1 to chip prices and ultimately increase end-product costs by approximately $3. While Taiwan's direct semiconductor exports to the United States remain relatively limited, Liu cautioned that Trump might implement tariffs based on origin principles or "Origin Traceability" theory — specifically targeting companies with substantial global manufacturing capacity but limited U.S. production facilities.
The tensions emerge against a backdrop of heightened U.S. scrutiny of semiconductor imports. American trade officials initiated a formal investigation into semiconductor tariffs in early May, a move that prompted TSMC to actively lobby for exemptions that would protect its multibillion-dollar manufacturing investment in Arizona. In its communications with U.S. officials, the Taiwanese chipmaking giant has emphasized that its American manufacturing expansion directly supports U.S. national security objectives in the semiconductor sector. ◼
