US, Taiwan ink chip deal to create huge investments, lower tariffs

​​​​​​​By Gokhan Ergocun

ISTANBUL (AA) - The US and Taiwan reached an agreement Thursday on semiconductors, according to the American Commerce Department, which said it will attract huge investments from Taiwan to the US, and decrease tariffs for Taiwan.

"This unprecedented commitment will strengthen US economic resilience, create high-paying jobs, and bolster national security," it said.

Taiwanese semiconductor and technology enterprises will make direct investments of at least $250 billion to build and expand advanced semiconductor, energy and AI production and innovation capacity in the US, it said.

Taiwan will also provide credit guarantees of at least $250 billion to facilitate additional investment by Taiwanese enterprises, supporting the establishment and expansion of the full semiconductor supply chain and ecosystem in the US.

"The United States and Taiwan will establish world-class industrial parks in the United States to strengthen America’s industrial infrastructure and position the United States as the global center for next-generation technology, advanced manufacturing, and innovation," it added.

The US reciprocal tariff rate applied to Taiwanese goods will total no more than 15% under the deal. US Section 232 duties applied to Taiwanese auto parts, timber, lumber and wood derivative products will total no more than 15%.

The US will also apply a zero-percent reciprocal tariff for generic pharmaceuticals, their generic ingredients, aircraft components and unavailable natural resources.