Trending Now
We have updated our Privacy Policy and Terms of Use for Eurasia Group and its affiliates, including GZERO Media, to clarify the types of data we collect, how we collect it, how we use data and with whom we share data. By using our website you consent to our Terms and Conditions and Privacy Policy, including the transfer of your personal data to the United States from your country of residence, and our use of cookies described in our Cookie Policy.
{{ subpage.title }}
Flags of Taiwan and the US.
The US tells TSMC to cut off China
The US Department of Commerce ordered Taiwan Semiconductor Manufacturing Company to stop shipping advanced chips to Chinese customers starting yesterday, Monday, Nov. 11. The government sent a letter to TSMC specifying that this restriction applies to all chips that are seven nanometers or smaller, which can be used to power artificial intelligence models.
Just weeks ago, TSMC notified the Commerce Department that it found that chips it produced were used inside of a Huawei processor. Huawei is a Chinese tech giant subject to stringent US trade restrictions. In response, TSMC cut off Sophgo, a Chinese chip designer that used its fabrication facilities to make the Huawei chip in question.
In Oct. 2022, the Biden administration announced stringent export controls against chips flowing into China. But there wasn’t an all-out ban, explains Xiaomeng Lu, director of Eurasia Group’s geo-technology practice. “US suppliers could seek a sales license to sell to Chinese buyers and sometimes they do get approved — this is the nature of [the] export control regime,” she said. “They are not blank bans.”
But now, TSMC, a strategic corporate partner of the US government, will be barred from all Chinese sales under the new export control rules. “It is possible that TSMC has sought these licenses and offered green lights [to bypass the rules],” Lu said. “Conversely, they have failed to comply with US rules and were caught doing so.”
Taiwan's then-Vice President William Lai at a news conference in Taipei, in January 2023.
Taiwan signals arms buildup in attempt to impress Trump
Less than a week after Trump’s US election victory, Taiwanese officials have publicly floated a plan to spend billions on US-made weapons and weapons systems, including F-35 fighter jets, retired US warships, an airborne radar defense system, and hundreds of Patriot missiles. The goal is to persuade China that an invasion of the island would come at an unacceptably high military, material, and political cost for Beijing.
Trump is widely expected to again turn up the heat in US relations with China, particularly on trade issues, right after his inauguration in January. Officials in the government of Taiwanese President William Lai hope that Trump will find arms sales to their country useful as a way of maximizing pressure on Beijing. And even if US-China relations eventually improve, Taiwan will have already upgraded its defense capabilities.
Ukrainian President Volodymyr Zelensky (L) and former President Donald Trump, meeting in New York City on Sept. 27, 2024.
How will Trump 2.0 approach foreign policy?
Donald Trump’s return to the White House will have massive geopolitical implications. During his first term, Trump’s chaotic foreign policy was driven by his “America First” philosophy, which combined a transactional view of alliances and an isolationist-leaning skepticism about US involvement in foreign conflicts. He withdrew from major agreements, routinely insulted allies (often via tweets), questioned the value of NATO and the UN, launched a trade war with China, cozied up to authoritarian adversaries, and was viewed as an untrustworthy leader across the globe.
Given the tumultuous nature of his initial four years in office, the world is now bracing for the impact of Trump’s return.
Here’s a closer look at what we can expect from Trump on some of the biggest foreign policy issues.
China
Trump 1.0 took a hardline approach to trade with China, which he holds responsible for draining American manufacturing jobs. He imposed several rounds of tariffs that were continued by the Biden administration.
The president-elect has threatened to raise those tariffs further – up to 60%. China, which has been struggling economically, is ramping up exports in order to get ahead of any Trump 2.0 tariffs.
Trump has also threatened to revoke the CHIPS Act, a law signed by President Joe Biden to increase competitiveness with Beijing in the semiconductors race by offering billions to companies that produce in the US. Trump says he prefers to simply slap tariffs on Chinese chips directly.
Taiwan
Trump’s victory is making Taiwan anxious, amid questions over whether he’ll continue to support the self-governing island democracy as it contends with an increasingly aggressive China. The president-elect has called for Taiwan, which Beijing views as a breakaway province, to begin paying the US for defense. By law, the US is committed to providing Taiwan with defensive weapons. The island purchases billions in arms from the US.
Trump has also accused Taiwan, the world’s biggest producer of semiconductors, of stealing the US’s “chip business.”
When asked in October whether he would use military force against a Chinese blockade of Taiwan, Trump said, “I wouldn’t have to” because Xi “respects” him and knows he’s “f— crazy.”
The Middle East
Trump’s election victory is good news for Israeli Prime Minister Benjamin Netanyahu. During his first term, Trump took numerous steps that aided Netanyahu’s agenda. He controversially moved the US embassy to Jerusalem, recognized Israel’s annexation of the Golan Heights, and said the US no longer considered Israeli settlements in the occupied West Bank as illegal under international law. Bibi in a tweet celebrated Trump’s win as “history’s greatest comeback!”
Trump will likely be even more pro-Israel than Biden – former CIA Chief Leon Panetta has even said he expects the president-elect to give Netanyahu “a blank check.”
But Trump has also expressed a desire for a quick end to the war in Gaza and has vowed to bring peace to the region. At a minimum, his election win gives Netanyahu room to delay any cease-fire deal until after Trump’s inauguration.
Saudi Arabia is also likely pleased to see Trump return. He stood by Saudi Crown Prince Mohammed bin Salman in the aftermath of the kingdom’s brutal murder of journalist Jamal Khashoggi, and derailed efforts in Washington to punish Riyadh. Trump could potentially use his strong ties with Saudi Arabia to foster a deal that would see the oil-rich country normalize ties with Israel — though the Saudis still say this won’t happen until the issue of Palestinian statehood is resolved.
Trump’s win also has significant implications with regard to Iran, which is currently locked in a tit-for-tat with Israel that has fueled fears of a wider war in the Middle East.
The US and Iran were on the brink of war under Trump after he ordered the strike that killed Qassem Soleimani, a top Iranian general. Tensions were already high at the time due to Trump’s decision to withdraw the US from the 2015 nuclear deal with Iran and reimpose harsh economic sanctions in a failed bid to get Tehran to agree to a stricter deal.
Trump has pledged to avoid new wars in his second term and in September signaled he was open to talks with Tehran to achieve a new agreement to ensure Iran doesn’t develop a nuclear weapon. But if he once again pursues a “maximum pressure” strategy, it could raise the risk of conflict.
Ukraine
Trump has pledged to end the war in Ukraine “in 24 hours,” but he hasn’t elaborated on how he’ll accomplish this.
As a result, his victory ushers in a new era of uncertainty for Kyiv. Trump, who’s repeatedly praised Russian President Vladimir Putin, opposes continued US support for Ukraine’s war against the Russian invasion. The Ukrainian military would struggle to sustain the fight without continued US assistance.
The dynamic between Trump and Ukrainian President Volodymyr Zelensky is awkward. Trump’s first impeachment in 2019 was tied to his decision to freeze aid to Ukraine as he pressured Zelensky to launch an investigation into Biden over bogus corruption allegations.
Trump has also blamed Zelensky for the war with Russia, though it was Putin who ordered the Russian invasion of the former Soviet republic.
But Zelensky on Wednesday said he had a “great” conversation with Trump as he congratulated him on winning the election. “We agreed to maintain a close dialogue and develop our cooperation. Strong and steadfast US leadership is vital to the world and to a just peace,” he added, praising Trump’s “peace through strength” approach to global affairs.
Putin on Thursday also congratulated Trump, praising him as a “brave man.” The Russian leader added that what Trump has said “about the desire to restore relations with Russia, to help end the Ukrainian crisis, in my opinion, deserves attention at least.”
Mexico
The US-Mexico relationship could suffer under Trump, who routinely rails against the country in relation to immigration, has pledged to conduct mass deportations, and has even suggested the US should use military force against Mexican drug cartels.
Trump has threatened to impose tariffs on America’s southern neighbor — and largest trading partner — even though this would potentially violate the trade deal that he negotiated with Mexico and Canada while in office.
Mexican President Claudia Sheinbaum is so far playing it cool in the face of these threats. On Wednesday, Sheinbaum said Mexicans have “nothing to worry about” over Trump’s election win.
“We are a free, independent, sovereign country and there will be good relations with the United States. I am convinced of this,” Sheinbaum added.
Europe
Trump’s victory raises many questions about US relations with Europe. Amid ongoing economic woes across the continent, European leaders are unsettled by Trump’s threat to apply blanket tariffs on goods imported into the US. But it remains to be seen whether Trump will make good on this.
Trump frequently clashed with European allies during his first term, using unprecedented and alarming threats to withdraw from NATO altogether as a means of getting them to spend more on defense as part of the alliance.. His win is sparking fresh conversations about the need for Europe to be less reliant on the US for defense.
NATO chief Mark Rutte on Thursday said Trump was “right” to pressure NATO countries to spend more on defense. The NATO chief said he was “looking forward” to sitting down with Trump to discuss issues of concern to the alliance.
Meanwhile, the far right prime minister of Hungary, Viktor Orban, celebrated the US election result as a “much needed victory for the world,” though on Thursday he cautioned that trade relations with a more protectionist administration “will not be easy.”
- The 2024 Paris Peace Forum faces a dysfunctional global order - GZERO Media ›
- UN's Rebeca Grynspan on the world’s debt crisis: Can it be solved? - GZERO Media ›
- Trump's plans for policy & personnel - GZERO Media ›
- Global leaders scramble to align with Trump - GZERO Media ›
- Europe's biggest concerns about Trump's return - GZERO Media ›
US takes a close look at TSMC and Huawei
The US Commerce Department is looking into whether Taiwan Semiconductor Manufacturing Company, the world’s largest contract chipmaker, is — knowingly or unknowingly — producing computer chips for the Chinese technology giant Huawei.
TSMC is one of the most strategically important companies to the United States because of its overwhelming market share in the chip fabrication process. Chip designers such as NVIDIA, AMD, and Apple send their chips to be made at TSMC facilities. But it’s also located, as its name suggests, in Taiwan — and that makes its relationship with China, which doesn’t acknowledge Taiwan’s independence, geopolitically significant.
The US investigation, recently reported by The Information, is eyeing whether TSMC is manufacturing Huawei chips — either those used to power smartphones or AI applications. Under the Biden administration, the US has strengthened export controls, preventing US companies — or those reliant on US parts — from selling chips and semiconductor manufacturing equipment to Chinese companies. While Huawei has the most advanced AI chips in China, they lag significantly behind US chipmakers Nvidia, AMD, and Intel because they don’t have unfettered access to important middlemen like TSMC and the Dutch photolithography company ASML — that is, unless the US finds a major breach or loophole.
Commerce Secretary Gina Raimondo recently said she’s under “no illusion” that her department is completely sealing off China – so she knows that US-made chips and equipment are making their way to China through underground markets and intermediaries. The New York Times reported that hundreds of thousands of banned chips have been sold in the Shenzhen electronics markets alone.
Xiaomeng Lu, director of Eurasia Group’s geo-technology practice, said that the TSMC investigation appears to look at whether the company is following export control rules. “This question is slightly different than whether Huawei got restricted chips from TSMC through illegal channels,” she said. “If Huawei is doing that, which is a more geopolitically significant development than potential TSMC misconduct – and TSMC proves they are following all US rules and regulations, Huawei should be the one receiving severe penalties. And I am almost certain they will.”
A violation by TSMC would be legally risky – and a massive business mistake given the company’s closeness with the US and other Western nations it relies on. But the experts who spoke with GZERO are skeptical this is the case.
Hanna Dohmen, a research analyst at Georgetown University's Center for Security and Emerging Technology, said TSMC would be foolish to knowingly allow sales to Huawei — even through an intermediary.
“Given TSMC’s position in the US-China technology competition, it would be surprising if TSMC is knowingly providing its services and exporting TSMC-fabricated chips to Huawei or any third-party affiliates,” she said. “Such a brazen violation of US export controls would put it squarely at risk of significant legal, political, and reputational consequences.”
TSMC is also set to receive $6.6 billion from the US government, she notes, to build advanced fabrication facilities in Phoenix, Arizona. “For such a significant amount of taxpayer money, it will be important for TSMC to demonstrate that it is doing everything it can to comply with US regulations to avoid political and reputational fallout with policymakers on the Hill, the administration, and the public.”
The US has not yet alleged any wrongdoing and has merely opened an inquiry, and it could be months before the probe is completed.
If wrongdoing is proven, TSMC would be on the hook for major financial penalties, just as Seagate was last year when it was fined $300 million by the Commerce Department for illicit sales to Huawei. Such a revelation would also call into question the balance of power between the US and China, their race for AI, and Taiwan’s role in the middle.Hard Numbers: China launches Taiwan drills, Former Scottish leader dies, Sudanese military kills civilians, Ukraine raids bars for holdouts
125: China launched major military drills around Taiwan on Monday, including a single-day record of 125 aircraft, an aircraft carrier, and other naval assets, in response to Taiwanese President William Lai's National Day speech framing Taiwan as a separate country from China. In addition to the drills, Beijing is threatening to impose further economic sanctions on the island it considers a breakaway province.
69: Former Scottish First Minister Alex Salmonddied at age 69 on Saturday, shortly after giving a speech in North Macedonia. Salmond, who is believe to have succumbed to a massive heart attack, was a heavyweight in Edinburgh for three decades, having led the Scottish National Party to become a dominant force and pressed for independence after the reestablishment of the Scottish Parliament in 1999.
23: At least 23 Sudanese civilians died this weekend after armed forces struck a market in the capital Khartoum, where it recently launched an offensive to dislodge the rebel Rapid Support Forces. More than 25 million people — half of Sudan’s population — are in severe need of food and medicine as the ongoing civil war has no end in sight.
25-60: Ukrainian authorities have reportedly begun raiding bars and concert venues looking for men aged 25-60 who have not complied with conscription laws. Ukraine is facing a severe manpower shortage and is intensifying efforts to find and induct able-bodied soldiers to hold the line against Russia’s superior manpower reserves.Taiwan President Lai Ching-te delivers a speech at the Presidential Palace during the Taiwan National Day (Double Ten) celebration at the Presidential Palace in Taipei on October 10, 2024.
Taiwan’s president flexes independence in National Day speech
Taiwanese President William Lai on Thursday took a shot at mainland China’s claims of sovereignty over self-governing Taiwan, saying, “The People’s Republic of China has no right to represent Taiwan.” The remarks, delivered in a closely watched speech marking the 113th anniversary of the revolution that founded the Republic of China (Taiwan’s formal name), won’t sit well with Beijing.
The People’s Republic of China maintains the so-called “One China” policy and sees democratic Taiwan as a rebellious province that will eventually be reunified with the mainland. The only question, from Beijing’s perspective, is whether that happens militarily or politically, and rhetoric like Lai’s seems to make the window for a peaceful resolution even smaller.
Chinese President Xi Jinping has reportedly ordered his military to be prepared to retake Taiwan by 2027, although that doesn’t mean he will actually attack that year. Some members of Taiwan’s opposition Kuomintang Party, including former President Ma Ying-jeou, worry that Lai is endangering Taiwan by antagonizing China.
In response to Lai’s speech, Taiwanese officials expect China to conduct military drills around the island — a demonstration large enough to show Beijing’s displeasure with Lai’s statements. However, China’s economic malaise is occupying much of the leadership’s focus, and the odds of seeing more provocative military measures are low.
A person takes photos of the waves as Typhoon Krathon approaches in Kaohsiung, Taiwan October 2, 2024.
Hard Numbers: Taiwan prepares for treacherous Typhoon, Benin crushes alleged coup attempt, Vietnamese sailors injured in South China Sea clash, Old US bomb makes a bang in Japan
2: At least two people are dead in Taiwan, and 70 injured, from weather attributed to Typhoon Krathon, which is expected to make landfall on the densely populated west coast of the Island on Thursday. Thousands have been evacuated from areas at risk of floods or landslides. One elderly man fell off a ladder while pruning a tree near his house in preparation for the storm, and another crashed into fallen rocks while driving. Western Taiwan is usually sheltered from major storms by its east coast mountain ranges and Taipei has put 40,000 troops on standby for expected rescue operations.
2: Two high-profile Beninese political figures were arrested on Tuesday on suspicion of plotting a coup against President Patrice Talon, allegedly having attempted to bribe the head of the Republican Guard. Benin is one of the most stable democracies in West Africa — even the communist dictatorship that ruled 1975-1990 handed over power peacefully — and was not previously believed to be at risk of extralegal regime change.
40: Vietnamese media reported Wednesday that some Vietnamese fishermen were severely injured in a clash near the disputed Paracel Islands in the South China Sea after around 40 foreign sailors boarded their vessels and beat the crews with iron bats on Sunday. The hull numbers of the alleged aggressors correspond with local Chinese maritime patrols, and Beijing confirmed an operation against Vietnamese fishermen near the Paracels but denied Hanoi’s version of events.
80: A long-forgotten US bomb dating back to World War II buried deep beneath a taxiway at Japan’s Miyazaki Airport suddenly exploded on Wednesday, causing a large crater and the cancellation of at least 80 flights. No one was harmed, thankfully, though hundreds of unexploded US bombs remain buried in Japan and are sometimes dug up during construction projects.
Ian Explains: Will China invade Taiwan?
President Xi Jinping has made it clear he wants to bring Taiwan under Chinese control. But how would he actually send troops to the island? And after watching Russia get bogged down in two years of grinding war in Ukraine, has his calculus changed? On Ian Explains, Ian Bremmer lays out Xi’s strategies for achieving his primary political goal: reunification with Taiwan.
Overall, the chances of an all-out Chinese invasion are slim to none. It would be a huge political and military risk for China, and its economy can’t afford the hit of global sanctions. Beijing is also deeply dependent on Taiwan for its technology infrastructure: Taiwan’s TSMC manufactures more than half of the world’s computer chips that power things like phones and electric cars. But Taiwan’s economy is also dependent on China, its largest trading partner. So Xi could still apply plenty of pressure without sending a single troop to the island. Will Xi try to solve his “Taiwan problem” before he leaves office?
GZERO World with Ian Bremmer, the award-winning weekly global affairs series, airs nationwide on US public television stations (check local listings).
New digital episodes of GZERO World are released every Monday on YouTube. Don''t miss an episode: subscribe to GZERO's YouTube channel and turn on notifications (🔔).