Taiwan Seeks Strategic AI Partnership With the United States After Major Trade Deal
Taiwan has announced plans to become a close strategic partner with the United States in artificial intelligence following a new trade agreement aimed at cutting tariffs and boosting high tech investment. Speaking in Washington on January 16, Taiwan’s Vice Premier Cheng Li chiun said the deal reflects a shared ambition to deepen cooperation in advanced technologies, especially AI and semiconductors.
The agreement, reached after negotiations led by Cheng, reduces tariffs on many Taiwanese exports and encourages new Taiwanese investments in the U.S. technology sector. The move comes as the administration of U.S. President Donald Trump pushes major semiconductor producers to increase chip manufacturing in the United States, particularly chips that power AI systems.
U.S. Commerce Secretary Howard Lutnick revealed that Taiwanese companies plan to invest about 250 billion dollars in the United States, covering semiconductor production, energy, and artificial intelligence. He described the deal as the largest semiconductor investment in U.S. history. Cheng called the agreement a win win arrangement, saying it would also encourage American companies to invest more in Taiwan.
The partnership, however, carries geopolitical weight. China strongly opposes closer U.S. Taiwan relations and considers the democratically governed island its own territory, a claim Taiwan firmly rejects. Despite lacking formal diplomatic ties, the United States remains Taiwan’s most important international supporter and arms supplier.
Taiwanese officials stressed that the investment strategy is company led, not forced by the government, and does not mean abandoning domestic production. Instead, the focus is on building resilient supply chains. Taiwan estimates that by 2036, advanced chip production will likely be split around 80 percent in Taiwan and 20 percent in the United States, strengthening global semiconductor stability while meeting growing AI demand from the U.S. market.
Taiwan’s Vice President Hsiao Bi khim said the deal highlights the island’s role as a key player in global trade. She noted that while Taiwan may be small in size, its agility, innovation, and technological strength make it an indispensable part of the global supply chain.
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