Taiwan says 40% shift of chip capacity to US is ‘impossible’
TAIPEI, Feb 9 (Reuters) – Moving 40% of Taiwan’s semiconductor capacity to the United States would be “impossible”, the island’s top tariff negotiator said, pushing back against recent comments from American officials calling for a major production shift.
In an interview with Taiwanese television channel CTS broadcast late Sunday, Taiwanese Vice Premier Cheng Li-chiun said he had made it clear to Washington that Taiwan’s semiconductor ecosystem, which has been built up over decades, cannot be replaced.
“I made it clear to the United States that this is impossible,” he said, referring to the 40 percent target set by the United States.
Cheng said that this ecosystem will continue to grow in Taiwan and added that the semiconductor industry will continue to invest domestically.
“Our overall capacity (in Taiwan) will continue to grow,” he said. “But we can expand our presence in the United States.”
“Our international expansion, including increased investment in the United States, is based on the idea that we remain firmly committed to Taiwan and continue to expand domestic investment.”
On Tuesday, US Commerce Secretary Howard Lutnick said the government should bring semiconductors to the US
“You can’t do all of your semiconductor manufacturing 80 miles from China,” he said. “This is so illogical… That’s why we need to bring him back.”
“When we leave office, my goal for this administration is to have a 40% market share in cutting-edge semiconductor manufacturing.”
Taiwan and the United States agreed last month to reduce tariffs on the island’s exports from 20% to 15% and increase Taiwan’s investment in the country.
The location of science parks in Taiwan will not change, but Taiwan is willing to share its experience in creating an industrial cluster and help the United States develop a similar environment, Cheng said.
He also said he was confident that Taiwan’s semiconductor capacity — including existing, under construction and planned projects in advanced manufacturing, advanced packaging and the broader supply chain — would far exceed its investment in the United States or any other country.
In an interview with CNBC last month, Lutnick said his goal is to bring 40% of Taiwan’s entire chip supply chain and manufacturing to the United States. If that doesn’t happen, tariffs on Taiwan will likely rise to 100%, he said.
In September, Lutnick told US television network NewsNation that Washington’s offer to Taiwan would be a 50-50 split in making chips, the vast majority of which are currently produced on the island.
