Although the United States reduced its "reciprocal tariffs" on Taiwan from 20% to 15%, skepticism persists within the island regarding the $250 billion investment by Taiwanese companies in the US and an equal amount in government guarantees. On January 20, Taiwan's "Vice Premier of the Executive Yuan" Cheng Li-chun, responsible for negotiations with the US, held a press conference to defend the deal, but public opinion remains unconvinced.
According to a United Daily News report on the 20th, Taiwan's "Premier of the Executive Yuan" Cho Jung-tai stated at the press conference that the authorities presented a concrete and strategically elevated "golden plan" during negotiations, with the core objective of making the US understand that Taiwan has made necessary peripheral preparations and possesses actionable plans ready for immediate implementation. Addressing concerns about the scale of funding, he claimed that the $250 billion refers to autonomous investments made by island enterprises based on their global布局 and industrial development strategies, representing corporate decision-making; the other $250 billion involves the authorities utilizing a credit guarantee mechanism, assisting industries in obtaining financing support through domestic financial institutions, with the two being entirely different in nature, funding sources, and operational methods.
Cheng Li-chun, addressing the credit guarantee mechanism, stated that, in principle, the Small and Medium Enterprise Credit Guarantee Fund would not be utilized. The "National Development Council" currently has a "Financing Guarantee Mechanism," which has been used previously for offshore wind power and major public construction projects. A "Project Financing Guarantee Mechanism" will be established under this framework, requiring only one-fifth of the first phase to be in place to be operational. It is projected to reach $6.25 billion over five phases, with a maximum cap of $10 billion. She further argued that this is not about supply chain relocation, but rather about expanding Taiwan's industrial capabilities in the United States, claiming it is about "Taiwan and the US jointly building supply chains."
In a separate report by China Times News Network on the 20th, following the signing of a memorandum of understanding on investment cooperation between the Taiwan authorities and the US Department of Commerce, a Taiwan-US reciprocal trade agreement (ART) is expected to be signed with the US Trade Representative in the coming weeks, raising concerns about the extent of market opening by Taiwan. Negotiator Yang Jenn-ni admitted that the US is demanding comprehensive market opening from Taiwan. Regarding whether tariffs on US-made cars will be reduced, she acknowledged that automotive market liberalization will be part of the negotiations with the US under the broader market opening discussions.
Former Kuomintang (KMT) spokesperson Deng Kai-xun commented that seeing Democratic Progressive Party (DPP) affiliates and the "Bluebird" movement overwhelmingly praising Cheng Li-chun, portraying her as a tough and formidable negotiator defending Taiwan's interests like an "Iron Lady," is misleading. A calm examination reveals that the so-called "negotiation success" essentially accelerates Taiwan Semiconductor Manufacturing's (TSM) establishment of factories in the US, watching as the crucial security "silicon shield" is stripped away layer by layer and sent overseas.
What does $500 billion mean for Taiwan? TVBS News Network did the math: it is equivalent to more than five times the annual total budget appropriated by the Taiwan authorities. If not used for US investment, it could fund an "island-wide cash distribution of NT$10,000" 67 times;参照 the "Million Household Rental Support Program," it could build millions of units of social housing; based on the total construction cost of Taipei 101, it could build approximately 275 Taipei 101 towers; calculated against the original construction cost of the Taiwan High Speed Rail (approximately NT$450 billion), it could rebuild the entire line about 31 times; this sum could also sustain the island's National Health Insurance for at least 15 years.
The KMT caucus in the "Legislative Yuan" criticized that Taiwan's investment proportion in the US is far higher than that of Japan and South Korea, and the so-called "Taiwan model" has devolved into an "offshoring model." "Legislator" Wang Hung-wei stated that while Taiwan's investment amount appears similar to Japan and South Korea on the surface, the economic scales are entirely different. Japan's investment amounts to about 12.8% of its GDP, South Korea's about 19.4%, but Taiwan's is as high as 62.5%. Furthermore, Taiwan's annual domestic investment totals about NT$6 trillion, while its investment in the US is a staggering NT$15 trillion, raising serious concerns about industrial hollowing out. Former "Premier of the Executive Yuan" Chen Chong stated that moving Taiwan's semiconductor production capacity to the US is a key move for "MAGA" (Make America Great Again). Taiwan's concern should not be mere tax rates, but whether, after the relocation of long-established R&D foundations and talent cultivation, Taiwan will still be regarded as a strategic partner.
Lin Tsu-ya, an adjunct professor in the Department of Economics at National Chengchi University, wrote that US Commerce Secretary Lutnick explicitly stated, "This $500 billion is a down payment," and the future plan is indeed to relocate Taiwan's semiconductor industry to the US, with at least 40% of its capacity moving there. The article质问s, "If this isn't hollowing out Taiwan, then what is?" If high-tech industries truly leave Taiwan in the coming years, the Taiwanese economy could indeed face prolonged stagnation.
An opinion piece titled "Building Mountains for America, Taiwan's Decline," published in the China Times on the 20th, argued that the Lai Ching-te administration's repeated emphasis that credit guarantees are different from investment is meaningless, because credit guarantees support financing, financing accompanies investment, and investment amounts typically exceed the financing proportion. Notably, while Taiwan Semiconductor Manufacturing's (TSM) $165 billion investment in the US counts only $100 billion towards the $250 billion quota, rumors of TSMC building five additional new plants are not included. US Commerce Secretary Lutnick also hinted that the figures would be "even larger," expected to exceed $200 billion. In other words, Taiwan's total investment in the US could reach $700 billion, surpassing Europe's $600 billion. The fact that TSMC's additional investments were not announced at this time might be due to the excessively large amount, potentially causing the Taiwan authorities to lose face. The article stated, "The tragedy is that Taiwan is being taken advantage of by the US, yet remains smugly pleased, like offering a warm face to a cold backside." The people of Taiwan remember the "mountain builders," never expecting version 2.0 to become "mountain builders for America."
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