A remark made by US president-elect Donald Trump stirred controversy, as he accused Taiwan of “stealing” the US chip industry. The statement oversimplifies the realities of global semiconductor production, trade interdependencies and Taiwan’s critical role in the technology supply chain. Clarifying these complexities and framing Taiwan’s role constructively is essential.
Semiconductors are the backbone of modern technology, powering everything from smartphones to electric vehicles, data centers and national defense systems. Taiwan’s leadership in chip manufacturing, particularly through Taiwan Semiconductor Manufacturing Co (TSMC), has enabled technological advances around the globe.
Taiwan’s dominance in the semiconductor industry results from decades of strategic investment, innovation and a collaborative global approach. TSMC produces more than 60 percent of the world’s semiconductors and more than 90 percent of advanced chips. These figures underscore Taiwan’s indispensable role in the technology ecosystem.
TSMC’s success has been mutually beneficial for Taiwan and the US. It supplies critical chips to leading US tech companies, such as Apple, Nvidia and AMD. These partnerships allow them to maintain their competitive edge, supporting millions of jobs in research, design and development in the US.
Moreover, Taiwan has demonstrated its commitment to strengthening the partnership. TSMC’s investments in Arizona are a significant step toward bolstering US semiconductor production capacity. This move reflects Taiwan’s willingness to address US concerns about supply chain resilience and national security.
The semiconductor supply chain exemplifies globalization and interconnected manufacturing networks. Production requires an intricate web of suppliers, engineers and facilities spread across continents. A single chip might involve chemicals from Japan, equipment from the Netherlands, expertise from the US and fabrication in Taiwan. No single country could dominate every aspect of the supply chain.
Instead of fueling misunderstandings, the US should view Taiwan as a partner. Collaborative efforts, such as the CHIPS and Science Act, provide a framework for strengthening domestic production while maintaining ties with trusted allies like Taiwan. Policies encouraging cooperation rather than confrontation would ultimately be more effective in ensuring economic security and technological leadership.
US-China competition has intensified in recent years, with semiconductors emerging as a focal point. Taiwan’s pivotal role in chip production places it at the center of the competition, heightening concerns of economic security and potential disruptions. However, portraying Taiwan as an adversary rather than an ally risks playing into geopolitical narratives that undermine US interests.
Taiwan’s commitment to democratic values, technological leadership and economic cooperation makes it a natural partner for the US. Framing Taiwan’s semiconductor dominance as “threatening” overlooks shared interests. Such rhetoric could also have unintended consequences. Taiwan faces immense external pressures, particularly from China. Misguided accusations risk weakening US-Taiwan ties when solidarity and support are paramount. A more constructive approach would focus on deepening economic, technological and diplomatic cooperation to counter shared challenges.
In response to Trump’s comments, Taiwan has emphasized its commitment to global innovation and partnership. The nation’s success in the semiconductor industry is rooted in its open economy, rule of law and collaborative approach to trade. Taiwan’s advances benefit not only its own economy, but also its global partners.
The semiconductor industry represents a challenge and an opportunity for US-Taiwan relations. As the US seeks to bolster its manufacturing capabilities, it must also recognize the value of its partnership with Taiwan. A balanced approach that combines reshoring efforts with continued collaboration would yield the best outcomes for both nations.
Policymakers should prioritize trade agreements, fostering joint innovation in technology, developing the workforce through institutional partnerships, enhancing supply chain resilience and maintaining strong diplomatic solidarity with Taiwan.
Taiwan’s semiconductor leadership is a boon, not a threat, to global technological progress and US competitiveness. Rather than succumbing to divisive rhetoric, the US should embrace Taiwan as a strategic partner in building a resilient, innovative and secure technology ecosystem.
Taiwan’s semiconductor industry should be recognized, celebrated and supported as part of a broader vision for a prosperous and interconnected future.
Darson Chiu is the secretary-treasurer of the Asian Bankers Association.
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