U.S. President Donald Trump wants to put tariffs on Taiwanese computer chips in a bid to move production to the U.S. While some sectors are better suited to shift their operations abroad, smaller, specialized Taiwanese businesses can better serve the U.S. by staying in Taiwan.
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00:00U.S. President Donald Trump has a distaste for trade deficits.
00:05He doesn't like it when his country buys more than it sells with other countries.
00:10And he's going after some of the U.S.'s closest partners to close the gaps.
00:15And I'll be putting the tariff of 25% on Canada and separately 25% on Mexico.
00:24And we will really have to do that because we have very big deficits with those countries.
00:29Taiwan is a top U.S. trade partner.
00:32Statistics from Taiwan's finance ministry show that trade with the U.S. has more than
00:37doubled over the past decade.
00:40But the trade imbalance between Taiwan and the U.S. has also grown, nearly 12-fold between
00:462014 and 2024.
00:49The U.S. has long run a trade deficit with Taiwan.
00:53Trump's tariffs are taxes levied on American businesses importing goods from targeted
00:58countries, raising costs and deterring purchases of those products.
01:04Taiwan produces over 90% of the world's most advanced computer chips.
01:09And roughly half of Taiwan's exports to the U.S. are related products.
01:14Now it seems Trump is training his tariff policy on Taiwan.
01:19We're going to be placing tariffs on foreign production of computer chips, semiconductors
01:24and pharmaceuticals to return production of these essential goods to the United States
01:29of America.
01:31But computer chips aren't Taiwan's only forte.
01:35When people think about Taiwanese manufacturing, they probably think about high-tech components
01:39like semiconductors.
01:40But the truth is there are a lot of everyday goods, like this bicycle chain, that are manufactured
01:45in Taiwan and exported all over the world.
01:48It's not just bicycle chains Taiwan specializes in.
01:52It manufactures components essential to worldwide industries.
01:57My understanding is there are only two countries, Taiwan being one of them, that can produce
02:04screws that are high quality enough, high grade enough, made out of the right materials
02:09so that they can be used in the automobile industry.
02:13And it's that way throughout the manufacturing industry, footwear, bicycle chains, motors
02:21that go into drill bits at dentist offices.
02:25There are Taiwanese companies that specialize in each of these things.
02:30Trump says his tariffs aim to do one thing, bring manufacturing to America.
02:35My message to every business in the world is very simple.
02:39Come make your product in America and we will give you among the lowest taxes of any nation
02:45on earth.
02:46But if you don't make your product in America, which is your prerogative, then very simply
02:51you will have to pay a tariff.
02:54Bigger companies may have an easier time setting up shop in the U.S.
02:59Taiwan's semiconductor juggernaut TSMC is building a plant in Arizona.
03:04But small Taiwanese businesses that focus on precise components may not be so flexible.
03:10No one in the world can make that one component like they do.
03:16And you can't get them to just pick up and move to the United States.
03:21I mean, you can try, but it would be, it's very difficult for a small and medium sized
03:26enterprise to do that.
03:30Taiwan's finance ministry says that the country exported $111 billion U.S. dollars worth of
03:36goods to the U.S. in 2024.
03:39But half of that was semiconductors, meaning Taiwan provides billions more in other vital
03:44components to the U.S.
03:47Taiwanese and U.S. manufacturing go hand in hand, though not in the most obvious of ways.
03:53While Trump may impose tariffs on Taiwan's chip industry in a bid to bring jobs to America,
03:59many current American jobs benefit from Taiwan's specialized manufacturing, meaning any trade
04:05war could have unexpected consequences.
04:08Leon Lien, Laurel Stewart, and Leslie Liao in Washington, D.C. for Taiwan Plus.