ISTANBUL

Shares of Taiwan Semiconductor Manufacturing Corporation (TSMC), the world's largest semiconductor manufacturer, saw a 5% rise Thursday after Taiwan confirmed that the firm got a reprieve from US President Donald Trump's newly announced 100% chip tariff.

“TSMC is exempted from the chip tariffs because it has set up plants in the US,” said Liu Chin-ching, minister in charge of the National Development Council, according to Bloomberg.

About other chipmakers in Taiwan that may be affected by the levies, Liu said that they “shall continue to stay ahead” if competitors face the same charges.

Liu also said that Washington has indicated a desire to carry on with tariff talks with Taiwan.

Despite the effects of the increased levies, the government still anticipates 3.1% economic growth in 2025, according to Liu.

Liu was speaking hours after Trump said the US is going to be putting "a very large tariff" on chips and semiconductors.

The level would be “approximately 100%,” Trump told reporters, although he did not specify the timing of the tariff.

"But if you're building in the United States of America, there's no charge, even though you're building and you're not producing yet, in terms of the big numbers of jobs, and all of the things that you're building. If you're building, there will be no charge," he said.

Taiwan currently holds the lion's share in semiconductor manufacturing, with more than half of the world’s chips and nearly all of the advanced ones manufactured on the island.

To avoid the high tariff rates, TSMC in March announced plans to invest $100 billion in building semiconductor plants in the US.

On the other hand, Taiwan's deputy trade representative Yen Huai-shing stated Thursday that it is not yet possible to fully estimate the effect of a potential 100% US duty on semiconductor imports, according to Focus Taiwan.

Yen stated at a Cabinet press briefing that it is yet unknown if the proposed levy would just apply to finished goods or if it would also cover manufacturing equipment and parts used in the chip industry.

He did not, however, provide specifics, nor did his remarks constitute an official policy pronouncement. Under the Trade Expansion Act of 1962, the US Department of Commerce is still investigating Section 232, which may result in import levies on electronic items like semiconductors.

Yen pointed out that "a significant portion" of Taiwan's exports to the US are information and communications technology (ICT) items, which are also under scrutiny under Section 232.

While the US imposed a 20% tariff on Taiwan, Taiwan's leader called the new tariff "provisional," adding that talks with Washington towards lowering the rate are continuing.

Lai Ching-te expressed hope that the tariff could be lowered further once a final agreement is reached.