Taiwan plans to invest approximately $1 billion annually in artificial intelligence (AI) as part of a strategic initiative to diversify its economy.
On Thursday, Business Insider reported that Wu Cheng-wen, chairperson of Taiwan’s National Science and Technology Council (NSTC), announced a $3 billion investment plan spanning the next three years. The funding will be directed toward expanding AI data centers and enhancing computing capabilities. Wu highlighted the importance of AI sovereignty, emphasizing its critical role in Taiwan’s national security.
Taiwan is targeting a minimum tenfold return on this investment. Analysts view the move as a key component of Taiwan’s strategy to reduce its reliance on China and broaden its economic base beyond semiconductors. As the world’s leading producer of advanced semiconductors, Taiwan is leveraging its technological expertise to make significant inroads into AI and other cutting-edge sectors.
While Taiwan has recently boosted exports to the United States, India, and Southeast Asia, China remains its largest trading partner. The shift toward AI is considered a calculated effort to reduce economic vulnerabilities by building stronger trade ties with a broader range of nations.
In a notable development, Taiwan Semiconductor Manufacturing Company (TSMC), the island’s leading chipmaker, has announced it will cease supplying advanced AI chips to China. Future approvals for supplying Chinese firms will reportedly require U.S. oversight.
Earlier this month, Reuters reported that Taiwan is actively assisting its companies in relocating production away from China. This move comes in response to the potential implementation of a 60% tariff on Chinese imports, a policy proposed following Donald Trump’s election as the next U.S. President.
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