Taiwan's Minister of Economic Affairs, J.W. Kuo, recently confirmed that Taiwan Semiconductor Manufacturing Co. (TSMC) is prohibited from producing its 2-nanometer chips outside of Taiwan due to local technology protection regulations. These measures ensure that TSMC's most advanced technology remains domestic, a decision reaffirmed amid speculation that TSMC might face U.S. pressure to manufacture 2-nanometer chips earlier than planned at its Arizona facilities following former U.S. President Donald Trump's re-election.

“Since Taiwan has regulations protecting our core technologies, TSMC cannot currently produce 2-nanometer chips overseas,” Kuo stated during a legislative session in Taipei. Although TSMC's long-term plan includes eventually manufacturing advanced chips abroad, the core 2-nanometer technology will remain in Taiwan, he emphasized. Taiwanese law mandates that any chips produced internationally must be at least one generation behind the most advanced chips produced domestically.

TSMC's roadmap reveals plans to produce 2-nanometer and even more advanced chips in the U.S. by the late 2020s, with its third Arizona fab projected to begin production around 2029-2030. Meanwhile, its first Arizona fab is set to start producing 4-nanometer chips next month, followed by a second fab, which is expected to ramp up 3-nanometer production in 2028.

The Taiwan Semiconductor Industry Association (TSIA) chairman and TSMC senior vice president, Cliff Hou, reassured stakeholders that the U.S. political landscape would not disrupt Taiwan-U.S. semiconductor cooperation. “The decades-long partnership remains stable regardless of U.S. political changes,” Hou stated at a forum in Hsinchu. He noted that while specific partnership details may shift, Taiwan's semiconductor sector would continue to expand its capabilities to maintain its leading position in the global supply chain.

Hou also mentioned that TSIA is proactively working with the government to attract foreign partners for setting up design and materials centers in Taiwan. Additionally, he highlighted the need for Taiwan to develop more expertise in semiconductor equipment and materials, areas currently dominated by foreign companies.