How did Taiwan use its hosting of the SEMICON Taiwan trade show in September 2026 to present itself as a democratic, reliable semiconductor partner in the global AI revolution, leverage companies such as TSMC, Foxconn, and ASE to strengthen international support despite Beijing’s

Taiwan used SEMICON Taiwan as “chip diplomacy”: it presented its semiconductor ecosystem as indispensable to the AI era and as a dependable partner rooted in democracy, rule of law, and supply-chain reliability—not simply as a producer of advanced chips. 35

• Linking technology to political legitimacy: President Lai framed Taiwan’s chip success as arising from democratic institutions and the rule of law, arguing that this makes Taiwan a trustworthy supplier that honours commitments. This narrative sought to turn semiconductor dependence into broader political support as Beijing presses other states to treat Taiwan as part of China. 53

• Mobilising an ecosystem, not only TSMC: Taiwan showcased the international reach of TSMC, Foxconn, ASE and their suppliers in foundry manufacturing, AI servers, advanced packaging and related services. The strategic message was that foreign partners gain access to a resilient, innovative whole-of-industry network by working with Taiwan, reinforcing Taipei’s practical international ties even where formal diplomatic recognition is limited. 3

• Accommodating Washington’s localisation agenda: Taiwan signalled it would share AI-related industrial gains with partners. TSMC’s planned U.S. investment had risen to $265 billion, including four additional advanced manufacturing facilities, while Taiwan’s economy minister announced a further $20 billion in planned U.S. investments by Taiwanese firms, driven by AI demand. 14 These commitments responded to U.S. pressure to manufacture more domestically and reduced Taiwanese exposure to potential U.S. semiconductor tariffs aimed at companies without U.S. production. 3

• Trade concessions paired with investment: Taipei’s tariff-reduction agreement with Washington formed part of this broader bargain: Taiwan offered investment, production capacity, and closer supply-chain alignment in return for more secure access to the U.S. market and a stronger bilateral relationship. The investments were prospective commitments, however; the government did not publicly identify the companies or projects behind the extra $20 billion. 4

• “Make with Taiwan,” not merely “made in Taiwan”: Officials acknowledged that Taiwanese firms must build and operate abroad to serve key markets. The formulation preserves Taiwan’s role as the source of design, know-how, capital, supply-chain coordination and trusted partnership even as physical manufacturing becomes more geographically distributed. 3

• European track: Taipei also used the show to cultivate the EU, whose proposed Chips Act 2.0 seeks to reduce strategic dependencies, expand advanced production and build partnerships with international semiconductor players. 2 Taiwan’s pitch was that investment and collaboration could be based on shared democratic and rules-based principles, including support for Ukraine, while both sides manage their separate economic and political frictions with China. 3

The underlying trade-off was clear: offshore investment may strengthen Taiwan’s political and commercial ties with the United States and Europe, but it also increases pressure to ensure that Taiwan remains the indispensable centre of the ecosystem rather than only its original manufacturing location.