Donald Trump imposes 100% tariffs on imported chips and semiconductors

Thursday 07 August 2025 - 13:20

By: Dakir Madiha

Donald Trump imposes 100% tariffs on imported chips and semiconductors

Major tariff hike targets global tech supply chains

US President Donald Trump announced plans to impose 100% tariffs on imported chips and semiconductors, a move poised to reshape the global technology landscape. Speaking from the White House on August 6, Trump stated, "We will implement significant tariffs on chips and semiconductors—around 100%. But this is great news for companies manufacturing them in the United States."

While no exact date has been set for the tariffs to take effect, the decision underscores Trump’s ongoing efforts to prioritize domestic production and reduce reliance on foreign suppliers.

Asian markets react to the announcement

Trump’s tariffs sent shockwaves through Asian stock markets, particularly affecting semiconductor manufacturers. South Korea’s SK Hynix saw its shares drop by 0.4% after an earlier 3% decline. In Japan, Tokyo Electron, a major producer of chip-making equipment, fell by 3.22%, while semiconductor manufacturer Renesas saw a 3.44% drop.

Conversely, Taiwan Semiconductor Manufacturing Company (TSMC), the world leader in advanced semiconductors, experienced a near 5% surge in its stock. Taipei confirmed that TSMC would be exempt from the tariffs due to its critical role as Taiwan’s top exporter and its existing US-based manufacturing facilities. Liu Chin-ching, head of Taiwan’s National Development Council, emphasized, "TSMC is exempt as it is vital to both Taiwan and US industries."

Strategic investments and exemptions

The stakes are high for Taiwan, which exported $7.4 billion worth of semiconductors to the US in 2024. To secure its position, TSMC announced a $100 billion investment earlier this year to build new manufacturing plants in the United States. Apple, a key TSMC client, joined Trump in announcing an additional $100 billion US investment, reinforcing its commitment to domestic production.

South Korea, which exported $10.7 billion worth of chips to the US last year, is lobbying for similar exemptions. Presidential spokesperson Kang Yoo-jung expressed optimism, stating, "We have been assured a most-favored-nation status in the semiconductor sector."

A pivotal moment for the tech industry

Trump’s tariff plan highlights the growing geopolitical tensions surrounding semiconductors, a cornerstone of the global tech economy. While the tariffs aim to bolster US manufacturing, they have triggered market volatility and raised questions about the long-term implications for international trade and supply chains. As negotiations continue, the global semiconductor industry faces a period of uncertainty and transformation.