Though the United States is the global leader in designing chips, the vast majority of chip production happens overseas, particularly in U.S.-ally Taiwan.

The tariffs would ensnare cutting-edge smartphone and PC-related chips for Apple, AMD and Nvidia if enacted. But Trump is betting his plan will bring more chip production to the US.

Semiconductor business between Taiwan and the United States is a "win-win" model for both sides given the high level of complementarity, the island's economy ministry said on Tuesday responding to tariff threats from U.