The U.S. and Taiwan made a trade deal to cut tariffs on semiconductor exports, deepen ties, and boost investments in the U.S., risking China’s ire. Taiwanese chipmakers expanding in the U.S. will enjoy tax breaks, while Taiwanese tech companies will invest at least $250 billion in U.S. production. Taiwan will guarantee an additional $250 billion in credit for further investments. This move is expected to benefit chip suppliers like ASML, Lam Research, and Applied Materials, with shares of chip company Nvidia rising over 2%. Taiwan’s semiconductor powerhouse, TSMC, will expand in the U.S. under the agreement, allowing chipmakers to import semiconductors and wafers tariff-free. President Trump imposed a 25% tariff on certain AI chips, but most other chips remain untouched for now. TSMC reported a 35% jump in fourth-quarter profit, speeding up expansion plans in Taiwan and Arizona. Taiwan offers to help the U.S. build tech clusters like those in Taiwan. Tariffs on auto parts, timber, lumber, and wood products from Taiwan will not exceed 15%. The U.S. Supreme Court will soon rule on the president’s authority to impose tariffs without Congress, which may impact trade deals like the one with Taiwan.

Read more at Yahoo Finance: US, Taiwan reach trade deal focused on semiconductors, US Commerce Department says