While Trump’s last tenure saw the U.S. strengthening its influence abroad, the current presidency prioritizes foreign policies based on transactionality. With rising tariffs on allies and a reversal of the country’s policy on Ukraine, the U.S.’s allies are rethinking their security strategies. Taiwan is a key example. Faced with tariff threats on its lucrative semiconductor industry, growing pressure for defense self-reliance, and an increasingly assertive China, Taiwan has seen both its domestic and foreign policy shift under President Trump’s novel transactional politics.
Shifting Perceptions in Taiwan
Trump’s strong stance on China during his first term had made him popular in Taiwan. Taiwanese people perceived Trump’s administration as a strong foil to China’s threat of annexation. Trump’s approval of significant U.S. arms sales to Taiwan, coupled with his unprecedented phone call with Taiwanese President Tsai Ing-wen — a move previous American presidents had deliberately avoided — laid a strong foundation for Taiwanese support of his regional policies. However, the first few weeks of Trump’s second term — marked by his rhetoric on semiconductors and his reversal of U.S. policy on Ukraine — have begun to shift this trend.
Trump’s tariff proposal on semiconductors, for which Taiwan represents 90 per cent of the world’s supply, has caused discontent. Given the U.S.’s trade deficit with Taiwan and, more importantly, its reliance on Taiwan’s semiconductors, the Trump administration has come to attack Taiwan’s quasi-monopoly through proposed tariffs. The Trump administration notably pushed Taiwan’s TSMC—the country’s leading chipmaker—to partner with the U.S.-based Intel factories. Given that Taiwan’s economy is heavily dependent on semiconductor production, U.S. efforts to shift manufacturing abroad, along with the threat of tariffs and broader economic pressure, have raised concerns about economic stability. Because Taiwan’s semiconductor dominance is not just an economic asset but a key pillar of its strategic security, any disruption to the industry carries wider geopolitical risks. Unsurprisingly, these pressures have sparked discontent and anxiety within Taiwan.
Perhaps most worrisome for the Taiwanese, however, is the U.S.’s recent shift in its stance on the war in Ukraine, a conflict many in Taiwan view as a cautionary parallel. Ukraine, like Taiwan, faces threats from an authoritarian neighbor and widely depends on the U.S. for security guarantees against said neighbor. As such, comparisons between Russia’s invasion of Ukraine, which the President no longer condemns, and China’s ambitions toward Taiwan have heightened Taiwanese concerns over U.S. support. Trump’s negotiations over Ukraine—both transactional, as seen in his insistence on a mineral deal, and aligned with autocratic interests—have been particularly alarming for Taiwan.
Trump’s Transactional Approach to Taiwan
While the United States has historically treated Taiwan’s defense as a vital component of its broader Indo-Pacific strategy, Trump has hinted at a move away from de facto protection of the island, promoting the financial aspect of it instead. In a departure from long-standing U.S. policy, the newly elected President has claimed that Taipei should pay for Washington’s protection, likening America to an insurance company and claiming that Taiwan does not provide the U.S. with any returns. Linked to Trump’s assertion on the necessity of a reciprocal relation between both states, the President has also insisted that Taiwan had to elevate its defense spending to a minimum of 10 per cent of its GDP, should it want to keep the U.S. as an ally.
The Trump administration’s transactional approach suggests that Taiwan’s willingness to invest in its defense will be key to maintaining strong U.S.-Taiwan relations, particularly as U.S.-China tensions escalate. Given Trump’s push for financially reciprocal partnerships, his foreign policy is likely to pressure Taiwan into increasing military purchases—not only to strengthen its own security against China but also to support the U.S. defense industry. At the same time, if Trump moves to reduce U.S. economic dependence on China through tariffs, Taiwan could face mounting pressure to counter Beijing both militarily and economically. This shift would likely push Taiwan to deepen its economic ties with the U.S. while reducing its reliance on China.
Uncertainty Over U.S. Military Support
Trump’s transactional approach extends to Taiwan’s defense, raising concerns over U.S. military support. While past administrations maintained strategic ambiguity, the previous Biden administration signalled a commitment to Taiwan’s defense. Trump, however, has questioned the value of protecting Taiwan, fueling uncertainty.
Meanwhile, Beijing has capitalized on Washington’s growing distance from Taipei by escalating tensions and reaffirming its commitment to “reunification.” At its most recent National Congress, Beijing pledged to firmly advance this cause while announcing a 7.2 percent increase in defense spending.” Taipei’s concerns grew after China’s embassy in Washington responded to rising U.S. tariffs, stating that Beijing was “ready to fight till the end—be it a tariff war, a trade war, or any other kind.” With U.S. support waning and China growing more agitated, Taipei now stands at a critical security crossroads.
Taiwan’s Strategic Position and Risks
Although Taiwan is unlikely to become a bargaining chip in Trump’s negotiations with China due to the United States’ reliance on Taiwanese semiconductors—the administration’s transactional approach to Taiwan remains a source of concern. Combined with its approach to the Ukraine conflict, this has reinforced perceptions that Trump may be more receptive to Beijing’s calls for “peaceful reunification.” Nevertheless, Taiwan’s dominance over the semiconductor industry is also likely to represent friction for Trump.
In essence, while Taiwan’s desire for security may drive it to seek U.S. support, Trump’s unpredictable and transactional approach suggests that Taipei might be better served by carefully balancing its relations with both the U.S. and China. This strategy could help avoid being forced into a rigid economic or political alignment that risks undermining its long-term stability and regional autonomy.
Edited by Samrawit Terrefe
The opinions expressed in this article are solely those of the author and they do not reflect the position of the McGill Journal of Political Science or the Political Science Students’ Association.
Featured Image by Timogan through Flickr