Taiwan aims to position itself as a close strategic partner of the United States in artificial intelligence following a trade deal that cuts tariffs and encourages large-scale Taiwanese investment in the U.S., Vice Premier Cheng Li-chiun said on Friday.
Speaking at a press conference in Washington, Cheng said the negotiations promoted two-way high-tech investment and laid the groundwork for deeper cooperation in AI. The talks come as the administration of U.S. President Donald Trump presses major semiconductor producers to expand manufacturing in the United States, particularly for chips that power AI systems.
Cheng led the negotiations that resulted in Thursday’s agreement, which reduces tariffs on many Taiwanese exports and channels new investment into the U.S. technology sector. While the deal strengthens Taiwan–U.S. ties, it risks angering China, which claims democratically governed Taiwan as its territory—claims Taipei firmly rejects.
U.S. Commerce Secretary Howard Lutnick said Taiwanese companies would invest about $250 billion in the United States across semiconductors, energy and AI. That figure includes $100 billion already committed in 2025 by TSMC, the world’s leading producer of advanced AI chips, with additional investment expected. Taiwan will also guarantee another $250 billion in credit to support further projects, according to the Trump administration.
Cheng described the agreement as “win-win,” saying it would also attract more U.S. investment into Taiwan. She stressed that the expansion is company-led rather than government-directed and does not mean abandoning domestic production. “This is not about ‘moving’ but about ‘building,’” she said, calling the U.S. expansion an extension of Taiwan’s technology ecosystem.
Taiwan Economy Minister Kung Ming-hsin said investments would also cover AI servers and energy infrastructure, though companies would disclose chip-related figures themselves. Taiwan’s benchmark stock index closed at a record high on Friday, buoyed by strong TSMC earnings and investor optimism over the deal.
Chang Chien-yi, president of the Taiwan Institute of Economic Research, said the agreement underscores Washington’s view of Taiwan as a key strategic partner in semiconductors, noting it was the first country to receive preferential treatment for chips and related products.
In a statement, TSMC welcomed the prospect of robust U.S.–Taiwan trade ties, reiterating that its investment decisions are driven by market demand. The deal must still be ratified by Taiwan’s parliament, where opposition lawmakers have raised concerns about the risk of hollowing out the island’s critical chip industry.
Lutnick said the objective was to bring 40% of Taiwan’s chip supply chain to the United States, warning that production not built on U.S. soil could face tariffs of up to 100%. Kung said Taiwan estimates that by 2036 the production split for advanced chips would be closer to 80% in Taiwan and 20% in the United States.
Taiwan Vice President Hsiao Bi-khim said the agreement demonstrated Taiwan’s importance in global trade. “Taiwan may not be large in area, but we are agile and innovative—and an indispensable force in the global supply chain,” she said.