TAIPEI, Feb 9 (Reuters) – It would be “impossible” for 40% of Taiwan’s semiconductor capacity to be moved to the United States, the island’s top tariff negotiator said, pushing back against recent comments by U.S. officials calling for a major shift in production.
In an interview with Taiwan’s CTS television station that aired late on Sunday, Taiwan’s Vice Premier Cheng Li-chiun said she had made it clear to Washington that Taiwan’s semiconductor ecosystem, built over decades, could not be relocated.
“It made it very clear to the United States that this is impossible,” she said, referring to the 40% target that the United States has floated.
That ecosystem will continue to grow in Taiwan, Cheng said, adding that the semiconductor industry will continue to invest at home.
“Our overall capacity (in Taiwan) will only continue to grow,” she said. “But we can expand our presence in the United States.”
“Our international expansion, including increased investment in the United States, is based on the premise that we remain firmly rooted in Taiwan and continue to expand investment at home.”
On Tuesday, US Commerce Secretary Howard Lutnick said the government needs to bring semiconductors to the US
“You can’t have all semiconductor manufacturing 80 miles from China,” he said. “That’s just illogical … So we need to bring it back.”
“When we leave office my goal, for this administration, is a 40% market share in advanced semiconductor manufacturing.”
Taiwan and the United States reached an agreement last month to lower tariffs on the island’s exports to 15% from 20% and for Taiwan to increase its investment in the country.
Cheng said there would be no relocation of Taiwan’s science parks, but Taiwan was willing to share its experience in building an industrial cluster and help the United States develop a similar environment.
It also said it was confident that Taiwan’s semiconductor capacity – including existing, under construction and planned projects around advanced manufacturing, advanced packaging and a broader supply chain – would far exceed its investment in the United States or any other country.
In an interview on CNBC last month, Lutnick said his goal was to bring 40% of Taiwan’s entire supply chain and chip production to the U.S. He said that if that didn’t happen, tariffs on Taiwan would likely rise to 100%.
In September, Lutnick told the American television network NewsNation that Washington’s pitch to Taiwan will be split 50-50 in the production of chips, the vast majority of which are now made on the island.