Trump is furious that Taiwan’s chip business is doing so well

• Trump told Bloomberg Businessweek that Taiwan took away the chipmaking business from the US.

• Trump wants Taiwan, which China claims as its territory, to pay the US for protection.

• Taiwan is the world’s chip powerhouse. It produces about 90% of all advanced microchips worldwide.

The U.S. relationship with Taiwan will likely be a sore point if former President Donald Trump secures a second term.

Trump, the Republican presidential candidate, told Bloomberg Business Week about Taiwan’s dominance in the chip industry that has made the island rich. He offered no evidence in the interview to support his claims about Taiwan.

“Taiwan took our chip business away from us,” he told Businessweek in an interview before Saturday’s failed assassination attempt. “I mean, how stupid are we? They stole our entire chip business. They’re immensely rich.”

Taiwan is a powerhouse in semiconductor chips. Produces 92% of the world’s most advanced microchips, according to the US-based company Semiconductor Industry Association.

In 2021, Taiwan’s chip industry generated US$137 billion in production and accounted for nearly 25% of total global chip sales, according to the US International Trade Commission in a report. November report.

Taiwanese chipmakers benefit US companies. TSMC is the world’s largest contract chipmaker: the company supplies chips to end users in the United States, such as Apple, which uses them in its consumer products. AI chipmaker Nvidia is also a major TSMC client.

However, Beijing claims self-ruled Taiwan as its own territory and has been intensifying military activity around the island in recent years. This sparked fears of a Chinese invasion of the island that could significantly impact the global economy and chip supply.

The US is increasing chipmaking at home to diversify some of its chip supply from $52 billion Taiwan CHIPS for America Act which was sanctioned by President Joe Biden in August 2022.

The US is still required by law to protect Taiwan providing the island with military means to defend itself.

“I think Taiwan should pay us for defense,” Trump told Bloomberg. “You know, we’re no different than an insurance company. Taiwan doesn’t give us anything.”

Taiwan-listed shares of chip powerhouse Taiwan Semiconductor Manufacturing Company fell as much as 3% on Thursday following Trump’s complaints.

In response to Trump’s statement, Taiwanese Prime Minister Cho Jung-tai said on Thursday that the US and Taiwan maintain a good relationship and that Taipei has strengthened its defense budget.

“We are willing to take on more responsibilities to defend ourselves and ensure our safety,” Cho said at a scheduled press conference.

China probably hasn’t yet decided whether it prefers Trump or Biden

It’s not the first time Trump has complained about Taiwan’s dominance in the chip business. Last July, he also complained about Fox News on the same subject.

“Remember this, Taiwan took our business. We should have stopped them, we should have taxed them, taxed them,” he said at the time.

China previously highlighted the potential U.S. U-turn on Biden’s stance that the The US would come to the defense of Taiwan if attacked.

“The United States always pursues ‘America First,’ and Taiwan can turn from a ‘chess piece’ to a ‘discarded piece’ at any time,” said Chen Binhua, a Chinese spokesperson. Taiwan Affairs Office in January.

But it is likely China has not decided whether he would prefer a Biden or Trump presidency, wrote Yun Sun, a non-resident member of the Brookings Institution, on May 31st.

After all, Trump’s first term saw his administration raise US government rules restrict interactions between American and Taiwanese officials – a deepening your relationship.

“China does not believe that Trump wanted a war with China over Taiwan, but they see his leniency toward his team in Taiwan as the result of his general ‘maximum pressure’ campaign to force China to yield on other issues. fronts, such as trade,” wrote Sol.

Read the original article at Business Insider