Taiwan talks chips, Chinese ‘coercion’ in U.S. meeting

By Sarah Wu

TAIPEI (Reuters) – Taiwan and the United States discussed chip shortages and how to respond to China’s economic “coercion” during the second session of an economic dialogue launched last year, Taiwan Economy Minister Wang Mei-hua said on Tuesday.

The talks came a week after a virtual meeting between U.S. President Joe Biden and Chinese leader Xi Jinping. After that meeting, Xi warned that supporters in the United States of Taiwanese independence were “playing with fire”. China claims fiercely democratic Taiwan as its own and has not ruled out the use of force to ensure eventual unification. Speaking to reporters in Taipei after five hours of online talks, led on the U.S. side by Under Secretary of State for economic growth, energy and the environment, Jose Fernandez, Wang said they discussed supply chain collaboration, including on semiconductors. “The semiconductor portion included the present short-term supply chain bottleneck problem. Even more important is the future long-term collaboration,” she added.

Chip powerhouse Taiwan has said it is doing all it can resolve the global shortage of semiconductors, and has been especially keen to show the United States, its most important international backer, that it takes the problem seriously. How to respond to China’s economic “coercion” also came up, Wang said, focused on Lithuania which has faced pressure from Beijing for allowing Taiwan to open a de facto embassy in its capital Vilnius.

“We all share the belief that all countries, all economies, should not be subject to this kind of external coercion,” she added. China downgraded ties with Lithuania on Sunday over the spat. Taiwan hopes the dialogue may lead eventually to a free-trade agreement with the United States and hailed last year’s inaugural meeting as a step forward.

It was part of increased U.S. engagement with Taipei under former President Donald Trump that the Biden administration has continued, to the anger of Beijing. The two sides held long-delayed talks on a Trade and Investment Framework Agreement virtually in July, and Taiwan said it hoped it would be possible to sign an FTA one day.