The U.S. is forcing Taiwan’s TSMC to buy a 49% stake in Intel and commit $400 billion in U.S. investment before it will consider cutting Taiwan’s chip export tariff from 20% down to 15%, the same rate given to Japan and South Korea. That reeks of hostage‑style trade policy.
https://www.reuters.com/world/asia-pacific/taiwan-says-20-us-tariff-rate-is-temporary-aiming-get-lower-figure-2025-08-01/
TSMC CEO C.C. Wei has made it clear that the company is “not engaged in any discussion with other companies regarding any joint venture technology licensing or technology transfer and sharing.” TSMC insists it has no intention of bailing out Intel’s failing fabs.
https://www.ft.com/content/8caf6d61-bdb8-4a14-ab2e-871c798ab3d0
Analysts warn that if TSMC ends up managing Intel’s plants, it would be dragging in an unwanted asset. Intel has already sold minority stakes in its fabs to private equity. That means TSMC would not even control what it buys.
https://www.taipeitimes.com/News/biz/archives/2025/03/13/2003833320
Market watchers see this as more bailout than trade deal. One analyst called any forced rescue of Intel by TSMC likely to “spell the end of Intel” unless terms are crystal clear.
https://www.fierceelectronics.com/electronics/heres-latest-could-tsmc-invest-20-intel-foundry
This is economic coercion in full display. The U.S. treats TSMC like a mega supplier but is demanding it prop up a rival. That puts Taiwan’s chip champion in a bind. Doing so could dilute TSMC’s focus on tech leadership and anger its board and investors.
For Taiwan it undermines the Silicon Shield concept. If TSMC loses control over its most sensitive tech by absorbing Intel factories, Taiwan loses a key geopolitical lever. This is not just about chips. It is geopolitics and strategic control dressed up as trade negotiation.