Home / Business and Economy / US, Taiwan Forge Tech Alliance: $250B Investment Deal
US, Taiwan Forge Tech Alliance: $250B Investment Deal
16 Jan
Summary
- US tariffs on Taiwanese goods reduced to 15% under new agreement.
- Taiwanese chip firms commit to at least $250 billion in US investments.
- Deal aims to bring 40% of Taiwan's chip supply chain to America.
The US commerce department announced a landmark agreement with Taiwan, significantly lowering tariffs on goods from the island to 15%. This tariff reduction is coupled with a substantial commitment from Taiwanese semiconductor and tech businesses to invest at least $250 billion in the United States. These investments are earmarked for building and expanding advanced semiconductor and artificial intelligence capacity on American soil.
The deal is designed to drive a major reshoring of the US semiconductor sector. Taiwan will also provide credit guarantees totaling at least $250 billion to further facilitate these investments. The commerce department stated the objective is to relocate approximately 40% of Taiwan's entire chip supply chain and production capacity to the United States, enhancing domestic self-sufficiency.
This agreement follows months of negotiations, with Taiwan's president having previously pledged increased US investments and defense spending. The move holds significant implications for major Taiwanese chipmakers, potentially leading to expanded operations in states like Arizona. Favorable treatment regarding future duties on semiconductors is also part of the arrangement for new US-based Taiwanese chip facilities.
