US Commerce Secretary Gina Raimondo stated on Wednesday that a Chinese invasion of Taiwan and seizure of chipmaker TSMC would be “absolutely devastating” to the US economy.
U.S. Commerce Secretary Gina Raimondo said Wednesday that a Chinese invasion of Taiwan and seizure of chipmaker TSMC (2330.TW) would be “absolutely devastating” to the US economy.
When asked about the impact before a US House hearing, Raimondo stated “it would be absolutely devastating,” declining to say how or if it would happen, adding: “Right now, the United States buys 92% of its leading edge chips from TSMC in Taiwan.”
U.S. Commerce Secretary Gina Raimondo said Wednesday that a Chinese invasion of Taiwan and seizure of chipmaker TSMC (2330.TW) would be “absolutely devastating” for the US economy.
When asked about the impact before a US House committee, Raimondo responded, “It would be absolutely devastating,” but declined to specify how or if it would happen, adding, “Right now, the United States buys 92% of its leading edge chips from TSMC in Taiwan.”
According to the department, the Taiwanese company will produce the world’s most sophisticated 2 nanometer technology at its second Arizona fab, which is anticipated to start production in 2028.
TSMC, the world’s largest contract chipmaker and a major supplier to Apple (AAPL.O) and Nvidia (NVDA.O), has previously announced plans to invest $40 billion in Arizona. TSMC plans to commence high-volume production in its first U.S. fab by the first half of 2025, according to Commerce.
In 2022, Congress passed the Chips and Science Act, which provides $52.7 billion in research and manufacturing subsidies to improve domestic semiconductor output and wean the United States from reliance on Asian chips. Lawmakers also authorized $75 billion in federal loans.
A 2023 US government document calculated that a large manufacturing disruption in Taiwan might result in a 59% increase in the US price of logic chips, which American downstream firms would have to pay.
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