Taiwan has declined a proposal from the United States for an equal split in semiconductor production, as confirmed by the island’s leading tariff negotiator.
Taiwan, US Advance Tariff Talks, $10 Billion Farm Deal
Taiwan’s Vice Premier Cheng Li-chiun has rejected the U.S. proposal for a 50-50 split in semiconductor production, Reuters reported. This decision was announced after Cheng returned from the U.S. following tariff negotiations.
“Our negotiating team has never made any commitment to a 50-50 split on chips. Rest assured, we did not discuss this issue during this round of talks, nor would we agree to such conditions,” said Cheng.
Taiwan's Premier Cho Jung-tai told parliament that substantive tariff consultations with the U.S. are underway, while trade envoy Cheng confirmed detailed talks had made “some “certain progress.”
Meanwhile, President Lai Ching-te met U.S. trade official Luke J. Lindberg and stated that Taiwan plans to purchase $10 billion worth of U.S. agricultural products—such as soybeans, wheat, corn, and beef—over the next four years.
See Also: Bitcoin, Ethereum, XRP, Dogecoin Tread Water As Shutdown Looks Inevitable – Benzinga
US Pushes Taiwan To Relocate Chip Production
The rejection of the U.S.’s proposal comes in the wake of increasing geopolitical tensions that have intensified Washington’s push to relocate critical semiconductor production to the U.S. Previously, the Trump administration had urged Taiwan to shift part of its manufacturing base to the U.S., with the aim of producing half of America’s chips domestically.
Just a day before Taiwan’s refusal, President Donald Trump and Commerce Secretary Howard Lutnick had placed a bold demand on the global semiconductor industry: 50% all chips used in America must be manufactured in America. They also warned Taiwan that it risks losing American defense guarantees if it does not relocate a significant portion of its advanced production to U.S. soil.
TSMC Denies Potential Investment In Intel
Taiwan, home to the world’s largest contract chipmaker Taiwan Semiconductor Manufacturing Co. (NYSE:TSM), holds a substantial trade surplus with the U.S. and is presently subject to a 20% tariff on its exports to the U.S. Despite TSMC’s ongoing $165 billion investment in chip factories in Arizona, the majority of its production will continue to be in Taiwan.
Moreover, earlier last week, TSMC had denied rumors of potential investments or partnerships with any company, including Intel (NASDAQ:INTC), thereby quashing any speculation about a possible solution to the U.S.’s chip production demands.
READ NEXT:
Image via Shutterstock
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
