Chip tariff talks between Taiwan and the United States have entered a decisive stage. Vice Premier Cheng Li-chiun firmly rejected Washington’s demand for a 50-50 chip production split. She delivered her statement after returning from the fifth round of in-person negotiations in Washington.
The Trump administration has pushed for a rule that requires half of US chips to be produced domestically. Commerce Secretary Howard Lutnick explained the proposal in a recent interview. This demand represents a clear shift from the supply chain cooperation model currently under discussion.
Taiwan’s delegation landed in Taipei this morning after intensive talks. Cheng led the team alongside Minister Without Portfolio and Chief Trade Negotiator Yang Jen-ni. Senior officials from the Ministry of Economic Affairs also joined the delegation. During the trip, they met the US Trade Representative’s Office and the Department of Commerce to push for progress.
Negotiations gained urgency after Washington introduced a provisional 20 percent tariff on Taiwanese goods on August 7. The administration activated this measure under Section 232 of the US Trade Expansion Act of 1962. Moreover, US authorities expanded their semiconductor market investigation to justify potential additional actions.
Taiwan used the chip tariff talks to seek tariff reductions and preferential treatment under Section 232. Officials argued that Taiwan’s semiconductor sector anchors global supply chains. Therefore, they believe heavy tariffs would raise costs and disrupt production for both countries.
Cheng stressed that Taiwan supports cooperation but rejects inflexible production quotas. She described the 50-50 proposal as unrealistic and misaligned with existing investment plans. Meanwhile, Yang noted that both sides made some progress on tariff issues and supply chain matters, yet key gaps persist.
Analysts say the chip tariff talks reflect broader strategic competition in semiconductor manufacturing. The United States wants stronger domestic production to protect economic and security interests. Taiwan aims to safeguard its leadership position while preserving stable trade relations.
Once negotiators finalize agreements on tariffs, supply chain cooperation, and Section 232 benefits, both sides will hold a concluding meeting. This outcome will shape future trade and technology relations between Taiwan and the United States. Furthermore, it will influence global semiconductor supply chains and investment decisions for years to come.
