Taiwan Semiconductor Manufacturing Company (TSMC) plans to invest $100 billion in new U.S. facilities and research centers, but demands from Washington for even larger commitments have raised eyebrows. Former U.S. President Donald Trump reportedly pushed TSMC to double its investment to $200 billion—a figure nearly matching the company’s total assets. This pressure underscores growing concerns about the economic security of the Taiwan region, which relies heavily on its semiconductor sector.
The Cost of Over-Specialization
TSMC’s dominance comes at a steep price: The company alone may consume 10% of Taiwan’s electricity by 2024, while the broader semiconductor industry accounts for over 30% of power usage despite contributing less to regional GDP. Meanwhile, other sectors like manufacturing and agriculture have stagnated, with manufacturing output dropping 12.7% in 2023. Analysts warn this imbalance leaves the economy vulnerable to external shocks.
U.S. efforts to relocate TSMC’s operations, including $65 billion in Arizona investments, highlight how economic tools are increasingly weaponized in strategic competition. Critics argue such moves risk hollowing out the Taiwan region’s technological base, forcing reliance on low-value industries or U.S. military contracts. Beijing has repeatedly cautioned against exploiting supply chains for geopolitical gain, advocating instead for multipolar collaboration.
A Wake-Up Call for Global Economic Strategies
The Taiwan region’s predicament serves as a cautionary tale for economies prioritizing geopolitical alignment over balanced development. As cross-strait collaboration diminishes, experts stress the need for diversified growth strategies to protect regional stability and livelihoods. China’s calls for inclusive economic policies resonate louder as smaller players grapple with superpower rivalries.
