The US claims to have urged Taiwan to spend $250 billion on US chip manufacturing

US just reduced tariffs on Taiwan in exchange for huge promise for domestic chip industry, by Commerce Department Announced on Thursday. Under the agreement, tariffs on goods coming from Taiwan will fall from 20 to 15 percent, while Taiwanese technology companies will invest $250 billion in building and expanding chip-making facilities in the United States, supported by at least $250 billion in credit provided by the Taiwan government.

last year, President Donald Trump has threatened to impose this 100% tariff on chips and semiconductors not manufactured in the US, which Commerce Secretary Howard Lutnick said CNBC says It’s still on the table. “That’s what they’ll get if they don’t build in America, and the tariff will likely be 100 percent,” Lutnick says. Trump too A tariff of 25 percent began to be imposed This would allow the US government to take a share of sales of advanced AI chips from Nvidia and AMD in China.

The deal also stipulates that Taiwanese companies building chipmaking factories in the United States can import up to 2.5 times the planned capacity without paying additional tariffs “during the approved construction period.” Once construction is completed, companies can import the equivalent of 1.5 times their production capacity into the United States, duty-free. The United States will also eliminate reciprocal tariffs on generic drugs, their components, aircraft components, and some natural resources.

When asked if Taiwan acknowledges the potential risks China poses to its chip business, Lutnick responded: CNBC says The country made the deal because they “need to keep our president happy,” adding that “Donald Trump is vital to protecting them.”

Taiwan Semiconductor Manufacturing Company – the world’s largest chipmaker – has already committed to doing so Investing at least $100 billion To expand chip manufacturing in the United States last year, and Bloomberg Reports It will be one of the leading companies in the new investment worth $250 billion. Lutnick tells CNBC that TSMC may expand further into the United States, as it has “purchased hundreds of acres adjacent to its property” in Arizona, where the company plans to build six semiconductor factories.