Taiwan aims to be strategic AI partner with US under tariff deal

TAIPEI, Jan 16 (Reuters) – Taiwan aims to become a close strategic artificial intelligence partner with the United States thanks to a deal to reduce tariffs and boost Taiwanese investment in the country, Taiwan Vice Premier Cheng Li-chiun said on Friday.

The Trump administration has pushed Taiwan, a major semiconductor producer, to invest more in the U.S., specifically in making the chips that are powering the trend towards AI.

The trade deal clinched on Thursday cuts tariffs on many of the semiconductor powerhouse’s exports, and directs new investments in the U.S. technology industry, but could also irritate China which views Taiwan as its own territory.

Taiwanese companies will invest $250 billion to increase production of semiconductors, energy and artificial intelligence in the U.S. That includes $100 billion already committed by chipmaker TSMC in 2025, with more to come, according to U.S. Commerce Secretary Howard Lutnick.

Taiwan will also guarantee an additional $250 billion in credit to facilitate further investment, the Trump administration said.

Cheng, who led the talks for Taipei, told a news conference in Washington that the deal was win-win, and would also encourage U.S. investment in Taiwan, for whom the United States is its most important international backer and arms supplier.

“In this negotiation we promoted two-way Taiwan–U.S. high-tech investment, hoping that in the future we can become close AI strategic partners,” she said in livestreamed comments.

The investment plan is company not government-led, and Taiwan companies will continue to invest at home, Cheng added.

“We believe this supply-chain cooperation is not ‘move,’ but ‘build.’ We expand our footprint in the U.S. and support the U.S. in building local supply chains, but even more so, it is an extension and expansion of Taiwan’s technology industry.”

Speaking to reporters in Taipei, Taiwan Economy Minister Kung Ming-hsin said investments would also include AI servers and energy. As to how much would be chip-related, that was up to companies to announce, he added.

TSMC said in a statement that it welcomed the prospect of “robust trade agreements” between the United States and Taiwan.

“Regarding TSMC’s plans, the market demand for our advanced technology is very strong, we continue to invest in Taiwan and expand overseas, all the investment decisions are based on market conditions and customer demands,” it added.

(Reporting by Wen-Yee Lee and Ben Blanchard; Editing by Jacqueline Wong and Stephen Coates)