TAIPEI/OP-ED: The Trump administration’s push for Taiwan to relocate half of its semiconductor production to the United States—framed as a quid pro quo for defense support against China—is a strategic gambit that Taiwan must approach with extreme caution. While the offer may seem like a lifeline amid rising cross-strait tensions, it risks undermining the very foundation of Taiwan’s global leverage: the “Silicon Shield.”
Taiwan produces over 90% of the world’s advanced semiconductors, a dominance that has made it indispensable to global tech giants and, by extension, to the geopolitical calculus of major powers. This concentration of chipmaking prowess has not only fueled Taiwan’s economic miracle but has also served as a deterrent against Chinese aggression. The logic is simple: destabilizing Taiwan would disrupt the global tech supply chain, triggering economic shockwaves that no major power—least of all China—can afford.
Now, the White House wants to dilute that leverage. Commerce Secretary Howard Lutnick has proposed a “50-50” split in chip production for the U.S. market, arguing that Taiwan’s proximity to China makes it an unreliable supplier in times of crisis. The administration has dangled promises of protection and threatened tariffs, all while pushing for a $165 billion investment in U.S.-based fabs. But this is not a partnership—it’s a strategic extraction.
Taiwan must ask: What guarantees come with this deal? The Trump administration’s record on international agreements is patchy at best. From the Paris Climate Accord to the Iran nuclear deal, Trump has shown a willingness to abandon commitments when politically expedient. The notion that Taiwan should trade away its industrial crown jewel for vague assurances of military support is not just risky—it’s naïve.
Moreover, the logistics of transplanting Taiwan’s chip ecosystem to the U.S. are daunting. TSMC’s supply chain is a dense web of specialized suppliers, engineers, and infrastructure that cannot be replicated overnight. Even if the fabs are built, the know-how and efficiency that make Taiwan the global leader in semiconductors are not easily exported. The move would also fracture Taiwan’s domestic economy, hollowing out a sector that employs tens of thousands and contributes significantly to GDP.
There’s also the geopolitical risk. Reducing Taiwan’s strategic importance could embolden Beijing. If the U.S. no longer depends on Taiwan for its most advanced chips, the calculus for defending the island shifts. The “Silicon Shield” is not just a metaphor—it’s a real deterrent. Undermining it could make Taiwan more vulnerable, not less.
Taiwan should respond with strategic prudence, as its trade office has indicated. Rather than acquiescing to demands, Taipei should negotiate from a position of strength. It can offer incremental investment in U.S. facilities, but only in exchange for concrete, binding defense commitments—ratified by Congress, not just promised by a volatile executive. Taiwan should also seek multilateral support, engaging allies like Japan and the EU to diversify its security guarantees.
In this moment, Taiwan must remember: its chips are not just products—they are power. To give that away without ironclad assurances is to gamble with its sovereignty. And in geopolitics, as in semiconductors, precision matters.
(The article is the opinion of the author and Europeantimes.org neither is responsible for the content not endorses the opinion)
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Khedroob Thondup
Khedroob Thondup is the son of Gyalo Thondup, elder brother of the Dalai Lama. Educated at St. Stephens College Delhi University and the University of San Francisco. He was a personal assistant to the Dalai Lama and accompanied him on his first trip to the U.S. in 1979. He was sent by the Dalai Lama to Beijing from 1980 till 1993 for dialogue talks where he interacted with Xi Zhongxun and Hu Jintao. He has served as Member of the Tibetan Parliament in Exile for three terms and is the President of the Tibetan Refugee Self Help Centre Darjeeling since 1987. He has edited two books, Dalai Lama My Son and Tibet in Turmoil and presently lives in Taipei, Taiwan.
