The US administration is in discussions with Taiwan regarding a potential agreement that could see Taiwanese semiconductor investment in US operations, as well as the training of US workers in advanced manufacturing, reported Reuters, citing familiar sources.
The arrangement would involve Taiwanese companies including contract chipmaker Taiwan Semiconductor Manufacturing Company (TSMC) committing new capital and expertise to broaden their presence in the US.
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Currently, Taiwan’s exports to the US face a 20% tariff, with Taipei negotiating to decrease this as part of a broader trade deal.
Semiconductors, which are essential for a wide range of high-tech products, are presently exempt from tariffs while the US works to strengthen its domestic production capabilities, the news agency said.
A source indicated that the total US investment expected from Taiwan would be less than that pledged by other regional economies and would include support to develop science park infrastructure, drawing on Taiwan’s experience.
The sources requested anonymity due to the sensitivity of the negotiations.
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By GlobalDataSouth Korea has pledged $350bn and Japan $550bn in US investment under agreements that lowered US tariffs on most of their goods to 15% from 25%.
The timeline for finalising the Taiwan deal remains unclear and the specifics are still under negotiation. The workforce training component of the agreement has not previously been reported.
The US Trade Representative’s office did not respond to a request for comment, according to Reuters.
Previously, US President Donald Trump said that some “skilled foreign workers” may be required for training Americans in advanced manufacturing facilities.
TSMC, which did not comment on the ongoing trade talks, has faced challenges in sourcing suitable workers for its US projects, the news agency said.
In January, TSMC CEO and chairman C.C. Wei said that construction of a new Arizona plant has taken at least twice as long as similar projects in Taiwan, citing a lack of skilled workers and supply chain issues.
“TSMC, for example, brought half of the construction workers from Texas to Arizona, increasing costs due to relocation and accommodation,” he said.
Taiwan’s Office of Trade Negotiations noted in a statement that discussions on supply chain cooperation with the US are ongoing under a “Taiwan model”.
Taiwan began developing its science parks in the 1980s, establishing a comprehensive supply chain for semiconductor production, Reuters said.
Taiwan Premier Cho Jung-tai, speaking to reporters in Taipei, said: “The two sides are at the stage of exchanging documents to firm up certain details.”
Last month, Taiwan Vice-Premier Cheng Li-chiun, who leads negotiations to decrease tariffs on Taiwanese exports, expressed optimism that both parties could reach a consensus on expanding US investment.
While Taiwan has expressed support for increasing US manufacturing, it has maintained that the “most advanced semiconductor technologies” and research will remain in Taiwan.
According to Reuters, President Trump recently addressed concerns about programmes for skilled foreign workers, saying such measures are needed for the US to maintain a leading position in critical industries.
Last week, Foxconn chairman Young Liu commented that the company is looking to collaborate with the US and other nations to develop science parks, hoping that this “could help trade negotiations”.
Taiwan’s representative to the Asia-Pacific Economic Cooperation summit, Lin Hsin-i, reported that he and US Treasury Secretary Scott Bessent had discussed supply chains and semiconductors during a recent meeting in South Korea.
According to Lin, Bessent had been keen on hearing about Taiwan’s experience in developing its semiconductor clusters, Reuters added.
In August, Trump announced a proposed 100% tariff on semiconductor imports but exempted firms manufacturing in the US or those committed to doing so, such as TSMC. However, US officials have indicated privately that these tariffs may not be implemented soon, reported Reuters.
TSMC, which has seen growth due to demand for AI applications, is investing $165bn (T$5.17tn) in new chip factories in Arizona, while the majority of its production remains in Taiwan.
In March, TSMC announced an increase in US investment of $100bn, with plans to construct five advanced fabrication plants.
Other Taiwanese companies including silicon wafer manufacturer GlobalWafers have also announced new investments in the US.
Any agreement with Taiwan could provoke a response from Beijing. Chinese President Xi Jinping told Trump in a recent call that Taiwan’s “return to China” remains a priority for China. The White House has not commented on this aspect of the conversation, Reuters reported.
