Trump announces substantial tariffs on semiconductors

The Trump administration has announced plans to impose tariffs on the import of semiconductors, a key component in the global race for artificial intelligence. According to President Trump, the tariffs will be imposed "very soon" and are not the only measures taken to promote the domestic manufacturing industry.

The decision to impose tariffs on semiconductors is part of the administration's broader effort to curb imports and boost domestic production. In recent months, several major tech companies, manufacturers, and others dependent on semiconductors have announced investments in the United States.

One such investment comes from Intel, who, along with the U.S. government, will convert $8.9 billion in subsidies into shares, securing about 9.9% of Intel. This move will support Intel's U.S. semiconductor production. Hitachi has also announced a $1 billion investment in manufacturing critical grid infrastructure essential for AI data centers in the U.S., including a new power transformer facility in Virginia.

Apple has promised to invest $600 billion over four years in the United States, while Micron Technology plans to increase its investments in the U.S. to $200 billion.

The tariffs will not be "very high," according to President Trump. However, they are subject to legal challenges regarding the president's power to impose generalized tariffs. Some of the imposed tariffs have been ruled illegal by lower courts, arguing that a president does not have the power to impose generalized tariffs. The Trump administration has appealed to the Supreme Court on the issue of the legality of the imposed tariffs on semiconductors.

The semiconductor industry is a subject of rivalry between the United States and countries like China and Taiwan. In a move to further support the U.S. industry, Washington has revoked the license of TSMC (Taiwanese giant) to export American-made material for electronic chip manufacturing to China without a license.

President Trump made this announcement during a dinner at the White House with top U.S. technology executives. He also clarified that companies that build factories in the United States or have committed to doing so will not have to pay the tariffs.

The tariffs on semiconductors are expected to have a significant impact on the global race for artificial intelligence, as well as the domestic manufacturing industry in the United States. The Trump administration, under President Trump's leadership, has prioritized the development of the manufacturing industry in the U.S. and these tariffs are a part of that effort.

As the situation develops, it will be interesting to see how the tech industry, both in the U.S. and abroad, responds to these tariffs and how they may impact the global economy.