Taiwan’s chip industry can now have a temporary reprieve, as semiconductors have been listed among imports exempted from the latest round of tariffs announced on Wednesday by US President Donald Trump, an analyst said yesterday.
The exemption of semiconductors gave some insight into Trump’s tactics, equity analyst Andy Hsu (許博傑) told the Central News Agency (CNA) in a phone interview in Taipei.
“Trump made some tariff threats at first, then TSMC [Taiwan Semiconductor Manufacturing Co, 台積電] pledged massive investments in the United States,” Hsu said, referring to TSMC’s announcement on March 3 that it would invest another US$100 billion in Arizona over the next few years.
Photo: CNA
“For now, Taiwan’s semiconductor industry can have a brief reprieve, but an unpredictable Trump means uncertainties remain, so I do not think the industry can stop worrying about tariff threats for too long,” Hsu said.
Furthermore, there are concerns about whether Trump would withhold the funding pledged by the previous US administration for semiconductor investors such as TSMC under the CHIPS and Science Act, Hsu said.
The White House has a goal to obtain billions more in commitments without the need to expand such grants, according to US Secretary of Commerce Howard Lutnick in a recent news report.
An industry expert told CNA that that the US government might ask Taiwanese semiconductor suppliers to lower the prices of their products and services, including those in the wafer foundry, integrated circuit design, and chip packaging and testing sectors.
While big suppliers could afford to drop prices to appease the US government, their smaller counterparts cannot make such big cuts, which might lead to a decline in their shipments or even a full exit from the market eventually, said the expert, who asked not to be named.
Meanwhile, TSMC’s response to the US’ latest tariff policies would be closely watched, as the company prepares to hold an investors’ conference on April 17, the expert said.
Trump has said publicly on several occasions that TSMC’s investments in the US would hit US$200 billion or even US$300 billion, which analysts said raises the question of whether the chipmaker would pour even more funds into the US amid the tariff threats.
Analysts have said there is some worry about leaks of TSMC trade secrets if it yields to prospective US government pressure to take a stake in Intel Corp to improve the US chipmaker’s foundry operations.
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