Taiwan has firmly dismissed the idea of relocating 40% of its semiconductor manufacturing capacity to the United States, calling such a proposal “impossible” due to the deep-rooted and highly complex nature of its chipmaking ecosystem. The statement comes amid increasing pressure from Washington to boost domestic chip production and reduce reliance on overseas suppliers, particularly in East Asia .

Speaking to international media, Taiwan’s Vice Premier and chief trade negotiator Cheng Li-chiun said that semiconductor manufacturing is not something that can simply be moved by policy decisions or financial incentives. She stressed that Taiwan’s dominance in chipmaking is the result of decades of infrastructure development, talent concentration, supplier integration, and technological expertise, all of which are tightly interconnected within the island’s economy .

The comments were made in response to growing discussions in the United States around reshoring advanced chip production under the CHIPS and Science Act, which aims to strengthen America’s semiconductor supply chain. Some US officials have floated the idea that a significant share of Taiwan’s production capacity could eventually be shifted to American soil — a notion Taiwan has now clearly rejected.

Taiwanese officials emphasized that while companies such as Taiwan Semiconductor Manufacturing Company (TSMC) are investing heavily in the United States — including multi-billion-dollar fabrication plants in Arizona — these projects represent new capacity, not a transfer of existing production from Taiwan. Advanced manufacturing nodes and core technologies, they added, will continue to be based primarily in Taiwan .

According to Cheng, Taiwan remains committed to expanding global cooperation and supporting supply chain resilience, but not at the expense of undermining its own industrial foundation. “Taiwan’s semiconductor capacity will continue to grow at home,” she said, noting that overseas investments are meant to complement domestic production rather than replace it.

The issue carries significant geopolitical implications, as semiconductors are increasingly viewed as strategic assets amid rising US-China tensions. Washington has pushed for greater self-sufficiency in chip manufacturing to reduce security risks, while Taiwan sees its semiconductor leadership as both an economic pillar and a stabilizing force in global technology markets.

Industry analysts say a 40% relocation target is unrealistic given the scale, cost, and workforce requirements involved in advanced chip fabrication. Building a single leading-edge fab can take years and tens of billions of dollars, along with access to specialized suppliers that are currently concentrated in Taiwan .

Despite rejecting the proposed shift, Taiwan reiterated its willingness to work closely with the United States on technology cooperation, investment, and innovation. However, officials made it clear that expectations must align with industrial realities rather than political ambition.