Washington (TDI): On Wednesday, United States President Donald Trump announced that he will impose a 100% tariff on all foreign-made semiconductors, and exceptions will only be made for the countries that have invested in the US companies.
During Wednesday evening, Trump told the media in his Oval Office, “We’ll be putting a tariff on of approximately 100 percent on chips and semiconductors, but if you’re building in the United States of America, there’s no charge, even though you’re building and you’re not producing yet.”
Trump also said that for companies like Apple, which have committed to building in the United States, “there will be no charge.” He added, “If, for some reason, you say you’re building and you don’t build, then we go back and we add it up, it accumulates, and we charge you at a later date, you have to pay, and that’s a guarantee”.
Different companies around the world started responding to Trump’s 100% tariffs. Taiwan’s TSMC released a statement saying that it will be exempted from the tariffs as the company has invested in the US, and many of its factories are operational in the US.
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Trade envoy Yeo Han-koo said South Korean companies would be exempt from the tariff, as Samsung and SK Hynix have already invested in facilities in Texas and Indiana, and that Seoul already faced “favourable” tariffs after signing a trade deal with Washington earlier this year.
In 2022, US former President Joe Biden signed the bipartisan CHIPS Act that offered billions of dollars in subsidies and tax credits to re-shore investment and manufacturing. That’s when TSMC, Samsung, and SK Hynix invested in the US.
Dan Lachica, who is the president of Semiconductor and Electronics Industries in the Philippines Foundation, said that the tariffs will be “devastating” because semiconductors make up 70 percent of the Philippines’ exports.
The countries that the US imports the most semiconductors from are Taiwan, China, Malaysia, Vietnam, Thailand, and India. The details about how and when these tariffs will take effect are inadequate at the moment, as no more details have been disclosed by the US administration.
An IR student whose interest lies in diplomacy and current affairs and a part time debater
