INTERVIEW/Tariffs on Taiwan chips won't solve U.S. dependence: Expert

Washington, Feb. 13 (CNA) John Bolton, former National Security Advisor to U.S. President Donald Trump, said Thursday that imposing tariffs on chips from Taiwan would not alter the reality that the United States is dependent on Taiwan-manufactured chips.

According to the D.C.-based think tank Information Technology and Innovation Foundation, the market share of U.S.-made chips fell by 70 percent between 1990 and 2020.

In an interview with CNA, Bolton said because Taiwan is vulnerable due to China, diversification is reasonable, but it needs to be done with a concrete understanding of what "the real issue is, which is the ability to have cutting edge capabilities that that you can't develop overnight."

Bolton added that Trump's reasoning that tariffs will incentivize American producers and investors to invest in America shows a lack of understanding of the current global situation.

"The international system is very complex, and it's true that the whole world is really dependent on the chips that are manufactured in Taiwan," he said.

He added that this is because the quality of the chips made by Taiwan Semiconductor Manufacturing Co. is very high, and the level of investment involved is also "extraordinarily high."

Bolton attributed the situation to a "lack of attention in the United States" for years, rather than Trump's claim that Taiwan "stole" the semiconductor manufacturing business, which he said is "absolutely not true."

He said imposing high tariffs on Taiwan's chips would be a "trade-distorting practice."

"I think it's very important for all customers in the United States to understand that their cost of doing business ... are going to go up and that that would either make their products more expensive, which would reduce their sales, or would eat into their profits," he said.

He said that as the U.S. is dependent on the chips for information technology, "there's a big constituency in the United States that doesn't want to see its cost go up across the board."

He added they "could lobby members of Congress and others that might persuade the White House not to put the tariffs in place."

Meanwhile, Bolton also expressed concerns about Trump's attitude over the Russian-Ukrainian conflict, which he labeled "cavalier."

He said Beijing was studying the Trump Administration's stance and determining whether it indicates "what it would do in case of a provocation against Taiwan."

Bolton called on Taiwan to be more proactive in making the U.S. public understand Taiwan's role and its importance to the U.S. economy.

He said that Taiwan has always had a "very effective embassy in Washington" and the capacity to have many friends in Congress, adding that it is time to "redouble those efforts."