Taipei [Taiwan], October 1 : Taiwan will not agree to a deal with the United States that would require half of all semiconductor production to take place in the country, according to a report by Reuters on Wednesday.
Citing a conversation between US Secretary of Commerce Howard Lutnick and U.S. television network News Nation over the weekend, the report stated that Washington's pitch to Taiwan would involve a 50-50 split in chip production, with the vast majority of chips currently made on the island.
The report noted that Taiwan's Vice Premier Cheng Li-chiun, who is leading the tariff talks with Washington, upon returning to the island, stated that she had not discussed the 50-50 idea suggested by the US during the negotiations.
"Our negotiating team has never made any commitment to a 50-50 split on chips. Rest assured, we did not discuss this issue during this round of talks, nor would we agree to such conditions," Reuters quoted Taiwan Vice Premier Cheng Li-chiun.
Taiwan, home to the world's biggest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC), runs a large trade surplus with the United States. The island's exports to the United States are currently subject to a 20 per cent tariff.
TSMC, whose business is surging due to strong demand for artificial intelligence applications, is investing USD 165 billion to build chip factories in the US state of Arizona. However, the bulk of its production will remain in Taiwan.
Citing Taiwan's government, the report said that last month, it hoped for a more favourable tariff rate from the United States after talks achieved "certain progress."
Speaking in parliament in Taipei on Tuesday, the report noted that Premier Cho Jung-tai said Cheng had had multiple talks with the United States on tariff issues.
Cheng, speaking at the airport, said that "detailed" discussions had taken place which yielded "certain progress," Reuters added.
Separately, Taiwan's presidential office stated late on Tuesday that President Lai Ching-te had met with Luke J Lindberg, Under Secretary for Trade and Foreign Agricultural Affairs at the US Department of Agriculture.
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