Taiwan's economy performed well last year thanks to a resilient export industry and an increase in flexibility caused by the US-China trade frictions. But the specter of US President Donald Trump's tariffs hangs over the island.
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00:00Taiwanese love their soup-filled dumplings.
00:04The popularity of the Din Tai Fung restaurant chain in downtown Taipei
00:08is a fine culinary example of how Taiwan's economy is growing strongly.
00:12Taiwan saw strong economic growth of 4.3% in 2024.
00:17The self-ruled island outperformed Singapore, Hong Kong and South Korea,
00:22despite the threat of military action by China which hangs over the island.
00:26The bedrock of Taiwan's economic success is its computer chip industry.
00:31Chip production accounts for around a quarter of the self-ruled island's economy.
00:36But US President Donald Trump has threatened to impose 100% tariffs
00:40on Taiwanese-made semiconductors.
00:43The tariff is aimed at forcing microchip production back to the US.
00:48The biggest player is TSMC, which makes nearly two-thirds of the world's microchips.
00:54TSMC is worth more than a trillion dollars.
00:57The manufacturer could increase microchip prices by 15%
01:01to offset the effects of tariffs.
01:05The Taiwanese government has indicated that it will support companies
01:08that plan to relocate to the United States,
01:11including helping them find partners.
01:16Some analysts believe the efficiency of Taiwanese companies
01:19will help them offset the impact of tariffs.
01:22Taiwan will definitely benefit in many areas because outside of China,
01:27if tariffs are put up, then the Taiwanese companies like Foxconn,
01:31like Delta Electronics, like Quanta, like many other Taiwanese companies
01:34have global supply chains and they're very nimble.
01:37They can move overseas very quickly.
01:39They can shift their supply chains quicker than most other companies can do.
01:44Some have already started moving.
01:46TSMC has begun producing advanced chips at its manufacturing plant in Arizona.
01:52Ray Yang, who works in chip strategy for the Taiwanese government,
01:55believes that Taiwan's strength in generative artificial intelligence, or GAI,
01:59will boost its relationship with the U.S.
02:04The Taiwan, the whole Taiwan semiconductor industry,
02:07we shall collaborate closely with Americans,
02:16not only the corporations but also research institutes, academics,
02:21to try to bring their innovative GAI solution
02:27to make the future semiconductor industry,
02:32the whole supply chain, to be more efficient.
02:37Taiwan's links to the U.S. are more than economic.
02:40It also has a security partnership.
02:42Beijing regularly threatens to take the island by force.
02:45Taiwan relies on the U.S. for protection
02:47and needs to keep its relations with the U.S. friendly.
02:52Dintai Feng's overseas business is booming.
02:55170 locations across more than 10 countries and regions worldwide.
03:01It even opened its flagship store in Donald Trump's home city of New York in 2022.
03:06Taiwan hopes its economy can beat the tariffs and stay on a roll.
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