Taiwan intends to enhance its ties with the United States through increasing investment and defense spending.
Summary
• TSMC, a major participant in the semiconductor sector, is investing $65 billion in new plants in the US, highlighting the close economic relations between the two countries.
• Despite strong economic achievements, Taiwan faces domestic political issues, particularly in terms of defense spending.
• The decision to increase defense spending is a response to calls for better national security, causing debates in Taiwan.
Taiwan‘s President, Lai Ching-te, has declared plans to strengthen ties with the United States by increasing investments and defense spending. This action is in response to US President Donald Trump’s statements disparaging Taiwan’s semiconductor sector.
Lai has pledged to engage in conversations to resolve these issues, with an emphasis on the global semiconductor supply chain and the formation of a democratic coalition for AI chip research. These debates are critical as Taiwan strives to preserve its semiconductor industry supremacy while addressing international security concerns.
TSMC Is in the Path of US Tariff Threats on Taiwan
Taiwan Semiconductor Manufacturing Company (NASDAQ: TSM), a major participant in the semiconductor sector, leads Taiwan’s economic connections with the United States. The business is spending $65 billion on new plants in the United States, highlighting the two countries’ close economic relations.
This investment emphasizes Taiwan’s trade surplus with the United States and underscores the semiconductor industry’s strategic relevance in the global economic and technical landscapes. By growing its footprint in the United States, TSMC hopes to consolidate its position as a semiconductor manufacturing leader.
Despite the strong economic achievements, Taiwan confronts considerable domestic political issues, notably in terms of its defense spending. The government’s decision to increase defense spending is a response to both external and internal calls for better national security. However, this has caused discussion in Taiwan, with political groups weighing the necessity for improved defense capabilities against other domestic concerns.
The results of these debates will have a long-term influence on Taiwan’s political environment and capacity to negotiate difficult foreign ties.
TSM Stock Declines Following Trump Remarks
TSM stock has seen significant volatility in recent days. On February 14, 2025, the stock began at $201.88 and has since declined to $197.8014 as of 09:41 EST. The day’s trading has varied between $197.47 and $199.99.
The stock has changed dramatically over the last 52 weeks, hitting a low of $122.91 and a high of $226.4. These moves reflect larger market trends and investor expectations for the semiconductor industry’s prospects.
TSM’s financial indicators indicate a strong market position, with a market capitalization greater than $1 trillion. The company’s dividend rate is $2.78, yielding 1.34%. A trailing P/E ratio of 28.75 and a future P/E ratio of 18.59 contribute to the company’s financial strength.
Analysts have set a target high price of $273.00 and a target low price of $180.00, with an average target price of $244.27. Despite recent price drops, the stock remains a strong market challenger, thanks to smart expenditures and continued demand for semiconductors.
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