Trump's plans to impose 100% chip duties hit Japanese giants, TSMC on the plus side

Shares of Asian semiconductor companies traded mixed on August 7 after U.S. President Donald Trump announced a 100 percent duty on chip imports. An exception will be made for companies that "build in the USA".

Shares of Tokyo Electron, Japan's largest semiconductor equipment maker and supplier to TSMC, fell more than 5% at the opening of trading in Tokyo, but then trimmed the drawdown to 2.3%. Adding to the negativity was announcement by Tokyo Electron of the dismissal of one of its employees on suspicion of involvement in the theft of TSMC trade secrets. Quotes of other Japanese giants in the semiconductor segment also sagged, with Renesas Electronics, one of the world's leading microcontroller makers, down 4% at the opening of trading, and chip test equipment maker Advantest down 3.3%.

South Korea's largest chip makers Samsung and SK Hynix have not been hit by Trump's 100 percent duty, the country's chief trade representative Yo Han Koo said. Following his remarks, SK Hynix shares rose to a plus of nearly 1 percent in Seoul, despite a more than 3 percent drawdown at the start of trading, reported CNBC. Shares of Samsung Electronics went against the trend and rose 2.5 percent. This was helped by Apple's announcement of its intention to buy chips made at Samsung's plant in Texas for the iPhone. Shares of the world's largest chip supplier TSMC, which is actively building plants in the U.S., jumped nearly 5%. 

 Donald Trump on August 6 announced that he would impose a "very large duty on chips and semiconductors," but companies that are already building or have committed to building factories in the U.S. will not pay the tax. "In other words, we will impose a duty of about 100 percent on chips and semiconductors. Но если вы строите в Соединенных Штатах Америки, плата не будет взиматься», — добавил он.

While a 100 percent duty on chips looks crushing, relief for companies investing in the U.S. - "even if they are building but not yet manufacturing" - could significantly reduce economic risks, according to a Barclays research note, which is cited by Reuters.

While the Japanese semiconductor manufacturing equipment market may initially be "jittery" due to the shock of the news of 100 percent duties, the move could prove positive for the industry in the long run, announced CNBC's Andrew Jackson, head of Japanese equities strategy at ORTUS Advisors. Japanese equipment remains indispensable for most companies looking to ramp up production in the U.S., he said.

At this stage, the "clear winners" are the big players like Apple, Nvidia and TSMC, which "have the greatest opportunity for investment," according to Daniel Newman, head of The Futurum Group. "These are the big players that President Trump wants to attract," said Newman, adding that smaller companies that don't have scale or clout will have to negotiate.

This article was AI-translated and verified by a human editor