After a week of trade tension with China, former President Trump is now putting pressure on Taiwan. His main issue? The U.S. relies too much on Taiwanese computer chips. He says the U.S. needs to bring the chip industry “back home.” That’s causing concern in Taiwan — and could affect American businesses too.
Why Chips Matter
Chips (also called semiconductors) are the brains behind modern technology. They power everything from iPhones and laptops to cars and medical devices. Most of these chips come from Taiwan.
One company, TSMC (Taiwan Semiconductor Manufacturing Company), makes over 60% of the world’s custom chips. They supply big U.S. companies like Apple, Intel, and Nvidia.
Trump’s Message: Make Chips in the USA
Last weekend, Trump said his new tariffs won’t affect chips. But just hours later, he changed course. He now says special chip tariffs could still come.
He’s also warning TSMC: invest more in the U.S. or face a 100% import tax. This is even after TSMC agreed to spend over $165 billion building new factories in America — which could create 40,000 U.S. jobs.
What’s Happening in Taiwan
For Taiwan, this is more than just business. Chips are a big part of the country’s economy. They also help protect Taiwan from threats by China.
China claims Taiwan as its own territory. But China also depends on Taiwanese chips. In fact, more than half of TSMC’s chips went to China in 2023. If China invaded Taiwan, it could lose access to these vital products — something its economy can’t afford.
That’s why some call Taiwan’s chip industry its “silicon shield.”
Tensions Are Rising
TSMC is investing in factories in the U.S., Japan, and at home in Taiwan. But not everyone in Taiwan is happy about it. Some politicians say the company is giving in to U.S. pressure. Others worry that Taiwan may lose important technology and jobs.
Taiwan’s president says he wants a “win-win” solution — one that helps the U.S. and still lets Taiwan grow.
What U.S. Entrepreneurs Should Know
If your business depends on electronics or anything with chips, this matters. More tariffs or tensions could mean:
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Higher prices
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Delays in deliveries
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Less supply
What you can do:
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Follow news about U.S. trade policies
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Talk to your suppliers about options and timing
These global chip issues could hit closer to home than you think — especially if new tariffs are introduced.
