us chip export policies under spotlight as semiconductor rivalry intensifies
Washington D.C., Tuesday, 11 February 2025.
The US is re-evaluating its chip export control policies, positioning them as a crucial element in the global semiconductor market. This strategy is deeply influencing the relationships with key industry players such as Nvidia and TSMC. The recalibrated policies are critical as the US seeks to maintain a competitive edge over China. The decisions made could potentially alter the landscape of global technology markets. The impact on trade relations with Taiwan and other semiconductor leaders also adds layers of complexity. These policies serve as a pivotal point in the intensifying competition for semiconductor dominance. As China amplifies its presence in this sector, US policies could significantly shape the future direction of this strategic industry, beyond immediate economic effects. The developments could determine the global balance in technological powerhouses, setting the stage for a new era in semiconductor manufacturing and capabilities.
Market impact of new tariff measures
The US semiconductor industry faces significant shifts as Trump’s administration prepares to implement new tariff measures this week [1]. These policies particularly affect relations with Taiwan, whose semiconductor exports to the US reached a record $111.4 billion in 2024 [2]. The market is closely watching Taiwan Semiconductor Manufacturing Company (TSMC), as the US government’s strategic move appears aimed at accelerating TSMC’s investment in advanced manufacturing processes on American soil [3].
Global trade dynamics shift
Taiwan’s electronic sector, contributing 65.2% of its total exports, has become increasingly critical in global semiconductor supply chains [3]. The ICT product exports surged by 59% to $132.5 billion [3]. This growth comes as Taiwan strategically repositions its trade relationships, with exports to mainland China and Hong Kong declining to 31.7% in 2024, down significantly from 43.9% in 2020 [3].
Regional competition intensifies
The semiconductor landscape is evolving beyond simple competition into a complex ecosystem of partnerships [3]. A notable development is Malaysia’s emergence as a semiconductor manufacturing hub, with the sector accounting for 64% of its electronic exports, valued at $85.78 billion in 2024 [5]. The US remains committed to strengthening semiconductor supply chain resilience, as evidenced by its 2022 memorandum of cooperation with Malaysia [5].