US President Donald Trump’s return to the White House has brought renewed scrutiny to the Taiwan-US semiconductor relationship with his claim that Taiwan “stole” the US chip business and threats of 100 percent tariffs on foreign-made processors. For Taiwanese and industry leaders, understanding those developments in their full context is crucial while maintaining a clear vision of Taiwan’s role in the global technology ecosystem.
The assertion that Taiwan “stole” the US’ semiconductor industry fundamentally misunderstands the evolution of global technology manufacturing. Over the past four decades, Taiwan’s semiconductor industry, led by Taiwan Semiconductor Manufacturing Co (TSMC), has grown through legitimate means — massive capital investment, technological innovation and an unwavering commitment to manufacturing excellence. Taiwan did not take anything from the US — it developed specialized expertise that complemented US companies’ strategic decision to focus on chip design.
That division of labor has created one of the most successful technological partnerships in history. US companies such as Apple, Nvidia and Advanced Micro Devices maintain their global leadership in chip design while relying on Taiwan’s unparalleled manufacturing capabilities. That arrangement has driven innovation, reduced costs for consumers and maintained the two sides’ technological competitiveness against rising global challengers.
Taiwan’s semiconductor industry has consistently demonstrated its commitment to supporting US manufacturing. TSMC’s US$40 billion investment in Arizona represents one of the largest foreign direct investments in US history. The first facility is already operational, with a second under construction. These investments create thousands of high-paying jobs while transferring crucial technological expertise to the US.
It is not just about maintaining good relations; it is a strategic decision that strengthens both economies. By establishing manufacturing facilities in the US, Taiwan’s chip industry helps address US supply chain concerns while maintaining its position as a global technology leader. That approach demonstrates how Taiwan can support US industrial policy goals while preserving its technological advantages.
Trump’s proposed 100 percent tariffs on foreign-made chips present a significant risk. For US consumers, such measures would dramatically increase prices for electronics, from smartphones to automotive systems. The US chip industry, which has built its global leadership around the ability to access Taiwan’s advanced manufacturing capabilities, would face disrupted supply chains and potentially lose ground to international competitors.
For Taiwan, while its advanced manufacturing capabilities provide some insulation from immediate impact, the long-term implications of US protectionism could be significant. However, it is crucial to understand that semiconductor manufacturing cannot be relocated overnight. The industry requires not just massive capital investment, but also decades of accumulated expertise and a sophisticated ecosystem of suppliers and skilled workers.
The semiconductor industry exists within a complex geopolitical landscape. Taiwan’s position as an indispensable partner in global technology production strengthens its international standing and security. Its leadership is not merely an economic asset — it is a crucial element of its strategic importance in the Indo-Pacific region.
Maintaining strong technological partnerships with the US serves both sides’ interests in preserving regional stability. As tensions with China continue, the interdependence created by the semiconductor partnership provides a concrete foundation for continued US support of Taiwan.
Rather than retreating from partnership in response to protectionist rhetoric, Taiwan should focus on deepening collaboration with the US. Technology transfer initiatives should expand beyond building fabs in the US, increasing knowledge-sharing programs between Taiwanese and US institutions. A crucial component of that collaboration should be the establishment of joint training programs that leverage Taiwan’s manufacturing expertise to develop skilled semiconductor workers in both territories. Furthermore, creating more resilient semiconductor supply chains requires coordinated investments in both sides’ industrial capabilities. Efforts should be complemented by joint research in next-generation semiconductor technologies, ensuring continued technological advancement.
Taiwan’s government understands the strategic importance of its semiconductor partnership. Policies should continue to support investment in US manufacturing while maintaining technological leadership. Enhanced incentive programs for Taiwanese companies to establish facilities in the US should be coupled with strengthened research collaboration. That approach, combined with robust intellectual property protections and sustained investment in semiconductor talent development, would ensure the long-term viability of the partnership.
Despite political rhetoric, market realities favor continued collaboration. The semiconductor industry’s complexity and capital-intensive nature makes it impossible for any single economy to achieve full self-sufficiency. The future lies in strategic partnerships that leverage strengths while ensuring supply chain resilience.
TSMC’s leadership in advanced manufacturing processes, coupled with US companies’ dominance in chip design, creates a partnership that is greater than the sum of its parts. That combination has proven remarkably successful in driving innovation and maintaining competitiveness.
The Taiwan-US semiconductor partnership represents one of the most successful examples of international technological collaboration in history. Rather than viewing US efforts to strengthen domestic manufacturing as a threat, it should be seen as an opportunity for deeper partnership.
This is not a zero-sum game — it is a partnership that has consistently delivered technological progress and economic benefits for both parties.
The future of the semiconductor industry is built on cooperation, not confrontation. By maintaining technological leadership and supporting US partners, Taiwan ensures its continued importance in the global technology ecosystem. That is the true story of the Taiwan-US chip partnership — not one of competition or theft, but of shared success through strategic collaboration and mutual respect.
Y. Tony Yang is an endowed professor and associate dean at George Washington University in Washington, D.C.
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