How Taiwan’s Chip Industry Navigates US Industrial Policy and Export Controls

Taiwan’s relationship with the United States, and its role in geopolitics more broadly, is inextricable from that of the semiconductor industry—and more specifically, Taiwan Semiconductor Manufacturing Co. (TSMC, 台灣積體電路製造股份有限公司). The chip shortage of 2021 put TSMC and chips at the center of debates around supply chains and equipment shortages, and made Taiwan a mainstream headline topic. TSMC, in its singular role at the apex of global semiconductor production, accounts for more than 90 percent of the world’s advanced semiconductor manufacturing capacity. In 2022, the Biden Administration continued the Trump Administration’s use of export controls, and placed the Foreign Direct Product Rule (FDPR) at center stage of the ongoing US effort to limit China’s technological advancement—especially in semiconductor capabilities. Those 2022 rules were expanded in 2023, and have once again received two major updates as Biden’s term ended and Trump returned to the presidency.Read More