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US Pursues Separate Semiconductor Tariff Deals With Countries Post Taiwan Pact

A U.S. official stated the Trump administration will pursue individual semiconductor tariff agreements with different countries, following a newly concluded deal with Taiwan. The Taiwan agreement allows its companies building U.S. chip capacity to import equipment duty-free during construction. This comes as President Trump signed a proclamation imposing a 25% tariff on specific AI semiconductors imported and re-exported from the U.S. South Korea's Trade Minister assessed the initial U.S. tariff measures as having a "limited" impact, noting they target advanced chips from firms like NVIDIA and AMD, not memory chips.

Key Points: US Seeks Separate Chip Tariff Pacts With Countries: Official

  • US-Taiwan deal sets chip tariff terms
  • Separate pacts for other nations like South Korea
  • Trump levies 25% tariff on certain AI chips
  • South Korea assesses "limited" impact on its firms
2 min read

US will seek 'separate' semiconductor tariff pacts for countries: Official

US official says separate semiconductor tariff agreements will be negotiated country-by-country, following a new deal with Taiwan, as Trump levies new AI chip duties.

"Separate agreements for separate countries - U.S. Official"

Washington, Jan 17

US President Donald Trump's administration will seek "separate" semiconductor tariff agreements for "separate countries," a U.S. official said, after the United States and Taiwan reached a deal on the chip levies this week.

"Separate agreements for separate countries," a U.S. official said, responding to a question from Yonhap News Agency regarding whether the deal with Taiwan would set a standard for chip tariffs or the U.S. would conduct separate negotiations with other countries for the sectoral tariffs.

The official's remarks came a day after the U.S. Commerce Department released a fact sheet about a trade and investment deal between the United States and Taiwan, which outlined a bilateral agreement on semiconductor tariffs.

According to the fact sheet, Taiwanese companies building new U.S. semiconductor capacity may import up to 2.5 times that planned capacity without paying sectoral duties during the approved construction period.

Taiwanese companies that have completed new chip production projects in the U.S. will still be able to import 1.5 times their new U.S. production capacity without paying sectoral duties.

The agreement on the chip tariffs raised questions over whether it will set a standard for chipmakers from other countries, including South Korea.

On Wednesday, Trump signed a proclamation to levy a 25 percent tariff on certain semiconductors for artificial intelligence (AI), which are imported into the U.S. and then reexported to other countries.

The White House has also said that Trump may impose "broader" tariffs on imports of semiconductors and their derivative products.

The president has rolled out various industrywide tariffs, invoking Section 232 of the Trade Expansion Act of 1962, a law that provides the president with the authority to adjust imports into the U.S. when he determines they threaten to impair national security.

South Korea's top trade envoy assessed the Trump administration's proclamation on semiconductor tariffs to have a "limited" impact on local chip makers.

Trade Minister Yeo Han-koo made the assessment upon his arrival home, following a six-day trip to the U.S., amid Washington's concerns over a recent revision to a South Korean law aimed at addressing false and fabricated online information.

"The first-stage measure announced is focused on advanced chips from NVIDIA and AMD, and excludes memory chips, which are key export products of local companies," Yeo told reporters at Incheon International Airport.

- IANS

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Reader Comments

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Priya S
The focus on AI chips from NVIDIA and AMD is interesting. It shows the US is really trying to control the future of computing. India has talent in this area, but we need our own fab units and design capabilities urgently. Relying on imports makes us vulnerable to these geopolitical tariff games. 🇮🇳
R
Rohit P
Good that memory chips are excluded for now, as South Korea said. That gives some breathing room. But the threat of "broader" tariffs is always there. This uncertainty is bad for business planning. Hope our trade ministry is watching this closely and has a solid strategy.
S
Sarah B
While the US framing this as "national security" under Section 232 is their right, it feels like a pretext for protectionism. It disrupts established global supply chains. As a consumer, I worry this will just make electronics and gadgets more expensive everywhere, including here in India.
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Vikram M
The deal with Taiwan is very specific - allowing imports during construction. This is a smart incentive to get companies to build plants *in* the US. India should learn and offer similar or better terms to attract semiconductor manufacturing here. We have the market and the engineers. We need the policy push.
K
Karthik V
Respectfully, I think some comments are being too alarmist. Every country looks after its own interests first. The US is securing its tech supply chain. India is doing the same with "Atmanirbhar Bharat". This is just how modern geopolitics works. We need to play the game, not just complain about it.

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