TAIPEI (TVBS News) — U.S. President Donald Trump (川普) announced Thursday (Aug. 7) a 100% tariff on imported semiconductors, promising exemptions for companies investing in U.S. manufacturing. This decision has captured Taiwan's semiconductor industry attention, as it could significantly impact operations and strategies.
Professor Kirk Yang (楊應超) from National Taiwan University's (NTU, 台灣大學) College of Political Science and Economics (國際政經學院) suggests Trump's policy aims to lure foreign firms to invest in the U.S. rather than focus on tariffs. Companies like Nvidia, Taiwan Semiconductor Manufacturing Company Ltd. (TSMC, 台積電), and Micron that announced plans to increase U.S. investments could receive exemptions.
However, Yang warns Taiwan's challenge is just beginning. Although firms like TSMC have established significant U.S. investment, many small and medium-sized enterprises may struggle to follow suit. Yang expresses concern this move could hollow out Taiwan's economy, as investments shift to the U.S., reducing domestic profits.
Tai Chih-yen (戴志言), an associate research fellow at the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院), noted Taiwan's employment and shipments could suffer as companies face pressure to invest in the U.S. While TSMC has made substantial investments, many smaller firms face financial constraints.
Bloomberg economists pointed out that Trump's chip tariff details remain sparse, including uncertainties about final rates, implementation timeline, and exemption criteria. If only 25% of Taiwan's U.S.-bound chips face the 100% tariff while 75% are exempt, Taiwan's overall chip exports to the U.S. could drop by 20%, decreasing total exports by 12%.
This scenario could drag down Taiwan's GDP by about 1% in the medium term. However, if the full 100% tariff applies, Taiwan's chip exports to the U.S. could see approximately 75% reduction in overall exports. Bloomberg economists predicted Taiwan's U.S. exports may decrease by 34%, with possible GDP impact up to 2.5%.
The U.S. imposed a 20% tariff on Taiwan, effective Aug. 7, which President Lai Ching-te (賴清德) claimed is temporary, with negotiations continuing. Due to confidentiality agreements, no terms related to U.S. deals have been disclosed.
The Ministry of Economic Affairs (MOEA, 經濟部) held meetings with TSMC, United Microelectronics Corporation (UMC, 聯電), Hon Hai Precision Industry Company Ltd (Foxconn, 鴻海), and other major tech giants to discuss countermeasures. No government official comments regarding TSMC's $200 billion investment, announced by Trump, have been received.
