Taiwan Rejects US's 50/50 Chip Production Split Proposal
Taiwan, a global tech powerhouse, has declined the US's proposal for a 50/50 split in future chip production. The US aims to move half of its chip needs to US soil, with Taiwan's TSMC playing a pivotal role. TSMC, the world's largest semiconductor manufacturer, has already invested $100 billion in US fabs, with Apple committing $600 billion to US production. Critical talks are ongoing between the two nations.
Taiwan, home to TSMC, is a vital player in global technology. TSMC's Arizona fab produces advanced N4 technology and plans to reach volume production on N3 by 2028. Meanwhile, TSMC's N2 process node will enter volume production later this year, predominantly at Fab 20 in Taiwan. However, Taiwan has not agreed to the US's proposed 50/50 split for future chip production, rejecting the current conditions.
The US is considering imposing tariffs on US firms that do not source an equal amount of American chips. This comes as the US seeks to reduce its reliance on foreign chip production. The US and Taiwan are currently engaged in critical substantive consultations to find a mutually beneficial solution. Taiwan, however, requires companies with fabs outside Taiwan to be a node generation behind Taiwanese production.
Taiwan's refusal to commit to a 50/50 split with the US has sparked ongoing negotiations. The US, aiming to boost domestic chip production, may impose tariffs on US firms that don't meet its chip sourcing requirements. TSMC, with its advanced technology and significant US investments, remains a key player in these discussions. Both nations are working towards a resolution that balances their respective interests.
