President Donald Trump has unveiled plans to impose tariffs on imported computer chips, pharmaceuticals, and steel, aiming to boost domestic manufacturing within the United States. This decision could have significant repercussions for key U.S. allies in Asia, such as Taiwan, South Korea, and Japan, which are leaders in these sectors globally.
The announcement marks a continuation of Trump’s recent trade measures, including a previous declaration to implement a 25 percent tariff on imports from Canada and Mexico, as well as a ten percent tariff on Chinese goods starting today, Saturday.
While Trump has hinted at tariffs on imported computer chips, specifics remain undisclosed. Asia is responsible for producing over 80 percent of the world’s semiconductors, with Taiwan Semiconductor Manufacturing Co. (TSMC) at the forefront. TSMC, which counts major U.S. companies like Nvidia and Apple among its clients, generated 70 percent of its 2024 revenue from North American customers. Despite constructing a $65 billion chip facility in Arizona, much of TSMC’s production is still based in Taiwan and may face tariffs.
South Korea’s Samsung Electronics and SK Hynix are dominant players in the memory chip market, controlling about 75 percent of the global DRAM and a similar share of the NAND flash market. Samsung is already investing $44 billion in chip facilities in Texas, aided by U.S. government subsidies.
The chip industry is crucial to the economies of Taiwan and South Korea. In 2024, South Korea’s semiconductor exports reached a record $141.9 billion, with $10.28 billion directed to the U.S., according to government data. The tariffs could have a broader economic impact on these nations beyond their manufacturers.
Though not directly targeted, Japan is vital to the chip supply chain, providing essential equipment through companies like Tokyo Electron and Advantest.
Trump’s tariff plans also extend to pharmaceuticals, potentially affecting major Japanese drugmakers such as Takeda, Astellas, Daiichi Sankyo, and Eisai. The U.S. is a significant market for these companies, with Takeda earning over half its revenue and Astellas 41 percent from the U.S. Astellas has stated it is preparing for geopolitical risks to ensure stable product supply and continues to invest in U.S. manufacturing sites.
If enacted, the proposed tariffs could disrupt supply chains, strain relations with important allies, and lead to increased costs for American consumers.
