At the SEMICON Taiwan trade show last week, Taiwan used the global stage to stress its role as a democratic and reliable supplier for the artificial‑intelligence revolution. President Lai Ching‑te addressed two separate sessions, underscoring that the island’s semiconductor strength rests on democracy and the rule of law, and that expanding chip production abroad will create shared prosperity for like‑minded partners.
U.S. Partnership and New Investment
U.S. Commerce Secretary Howard Lutnick warned that tariffs will target companies that do not produce chips on American soil. In response, Taiwan and Washington earlier this year struck a deal that lowers export duties in exchange for greater Taiwanese investment in the United States. Economy Minister Kung Ming‑hsin opened the U.S. pavilion and announced an additional $20 billion of Taiwanese capital slated for the United States, complementing TSMC’s massive $265 billion Arizona fab project.
Bill Frauenhofer, the Commerce Department official overseeing the tariff agreement, called the partnership “phenomenal,” noting that both nations have vested interests in making it successful. Foxconn chairman Young Liu echoed the sentiment, saying companies must now “think about how to make with Taiwan, not in Taiwan; make with Taiwan in the country where the market is.” ASE chief operating officer Tien Wu agreed, adding that “politically it is the right thing” and that the industry has little choice but to follow the shift.
European Union Outreach
Beyond the United States, Taiwan is courting the European Union. The EU sent Commission official Kilian Gross to pitch the bloc’s Chips Act 2.0, seeking greater Taiwanese investment in Europe. Deputy Foreign Minister Francois Wu highlighted shared values of democracy, freedom, and a rules‑based international order, noting that both Taiwan and the EU have stood firmly with Ukraine against Russian aggression and face diplomatic pressure from China.
In the French pavilion, Wu emphasized that technology should be used to connect people, not to control them, reinforcing Taiwan’s message that its chip expertise serves open societies rather than authoritarian agendas.
Implications for the Global Supply Chain
The push to relocate chip manufacturing aligns with broader trends in the industry to diversify supply chains away from single‑point vulnerabilities. By encouraging Taiwanese firms to build facilities in allied nations, the island hopes to safeguard the AI supply chain while reinforcing democratic alliances.
While the move may raise costs for some manufacturers, officials argue that the long‑term benefits of resilience, security, and shared prosperity outweigh short‑term price concerns. The combined U.S. and EU outreach signals a coordinated effort to counter Beijing’s attempts to isolate Taiwan and to ensure that the island’s semiconductor leadership remains in the hands of free societies.
Looking Ahead
President Lai concluded his remarks by urging continued collaboration, stating that “resilience creates shared prosperity.” As Taiwan deepens its chip diplomacy, the island’s democratic values and economic might are poised to shape the future of AI technology worldwide.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
