TAIPEI, Taiwan — Taiwan’s President William Lai Ching-te has praised a Taiwanese semiconductor company’s significant investment in Arizona as the “best model” for Taiwan’s efforts to establish a chip supply chain that reduces dependency on Chinese producers. These remarks were made during a meeting with Arizona’s Governor Katie Hobbs, who is visiting Taiwan.

Taiwan’s leading chipmaker, TSMC (Taiwan Semiconductor Manufacturing Company), has pledged a total of $100 billion to construct three chip foundries, a research and development (R&D) center, and two packaging facilities in Arizona. This is in addition to a previous commitment of $65 billion to build three chip foundries in the state, one of which has already begun operations.

Lai and TSMC emphasized that the decision for the latest investment was driven by customer demand, not pressure from former President Donald Trump’s administration. Trump had previously claimed that Taiwan had taken U.S. chip business and expressed his desire to bring it back to the U.S.

During their meeting, Lai highlighted that Taiwan and Arizona are collaborating to create a "non-red" supply chain, excluding Chinese suppliers, as China poses a military threat to assert its claim over Taiwan.

Despite expanding in the U.S., TSMC has assured that its operations in Taiwan would not be impacted. The company, which is at the forefront of chip development, currently employs 10,000 people in Taiwan to research and develop 1.0-nanometer chips. Taiwan is responsible for more than 90% of the world’s advanced computer chip production.

While the U.S. does not officially recognize Taiwan as a country, it remains Taiwan’s strongest ally and its largest arms provider.

Job Creation and Economic Impact

Governor Hobbs expressed enthusiasm about the economic opportunities tied to TSMC’s investment. “I’m thrilled by Arizona’s emergence as America’s hub for advanced manufacturing, creating hundreds of thousands of good-paying jobs and bringing billions of dollars of investment into our state,” Hobbs said in a news release prior to her meeting with President Lai.

The TSMC project is expected to create 40,000 construction jobs over the next four years, alongside tens of thousands of jobs in tech and manufacturing sectors. “This investment will not only contribute to the global advancement of artificial intelligence and other technologies but will also strengthen bilateral ties,” Hobbs added.

The TSMC project is being heralded as a landmark investment with significant implications for both Arizona’s economy and global technology advancement, particularly in the areas of artificial intelligence and semiconductor manufacturing.

Broader Economic and Geopolitical Implications

This massive investment in Arizona underscores the growing importance of semiconductor manufacturing outside of traditional hubs like Taiwan and China. By investing heavily in the U.S., TSMC aims to solidify its position in the global semiconductor industry while reducing the risks posed by geopolitical tensions in Asia. The company’s decision to expand in the U.S. comes as the global demand for semiconductor chips continues to rise, driven by the need for advanced technologies in sectors such as artificial intelligence, automation, and electric vehicles.

Arizona has increasingly positioned itself as a critical player in advanced manufacturing in the U.S., particularly in the tech sector. Governor Hobbs’ office expects this investment to create not only high-paying jobs but also a long-lasting economic impact on the state, further cementing Arizona’s status as a key location for tech and manufacturing industries.

Future Developments

As construction for TSMC’s facilities gets underway, both Arizona and Taiwan are optimistic about the future collaboration. The state is poised to see a surge in skilled labor demand, particularly in fields related to semiconductor manufacturing, engineering, and research. Moreover, the development is expected to spur additional investments in infrastructure, technology, and education.

The TSMC project is likely to have far-reaching effects on both local economies and the global tech industry. As the facilities are developed and begin operation, Arizona could see a transformation into a major hub for semiconductor innovation and production, making it an essential player in the global supply chain for critical technologies.

With continued collaboration between Arizona and Taiwan, both governments are hoping to forge a stronger economic and geopolitical partnership, with Arizona serving as a model for advanced manufacturing in the U.S.

Originally reported by Christopher Bodeen in 12 News.