The trade deal signed between the US and Taiwan this week brings Washington’s tariffs on Taiwanese exports in line with those of other big trading partners. But it excludes the core of the two countries’ trade relationship: chips.

The deal builds on Taiwan’s pledge last month that its tech companies would invest $250bn to make chips in the US in exchange for chip tariff exemptions. But the lack of available information on the investment pledge leaves big questions about the way forward for Taiwan Semiconductor Manufacturing Company, the world’s biggest maker of chips.

Analysts and investors in TSMC, which has become one of the world’s most valuable companies by making chips for the likes of Nvidia and Apple, are trying to work out the implications for its spending commitments and manufacturing footprint.

The uncertainty highlights the complexities of doing business under US President Donald Trump for TSMC and its clients, as well as for US companies such as Google and Microsoft that are spending huge sums on AI servers powered by Nvidia-branded, TSMC-made chips.

“There’s negotiated text beyond this memorandum of understanding,” said an industry insider. They added that Washington was unlikely to release a fuller text of the January agreement until after Trump meets Chinese President Xi Jinping in Beijing in April, because Trump does not want issues over Taiwan to interfere with building stable relations with China.

One key Trump administration plan reported by the FT this month envisions TSMC allocating quotas for bringing chips into the US tariff-free — which it and other Taiwanese companies will get in exchange for building capacity onshore — to its American customers, the actual importers that would be hit by tariffs.

January’s $250bn agreement accommodated the Trump administration’s desire to ensure a stable, onshore supply of cutting-edge chips.

The agreed figure was the sum of Taiwanese companies’ existing investment plans, according to Taiwan’s vice premier Cheng Li-chiun. TSMC, with its massive capital spending — forecast over the next three years to significantly exceed the $101bn spent over the past three years — is expected to account for the lion’s share.

According to US commerce secretary Howard Lutnick, $100bn of TSMC’s previous commitments to build US factories is included. TSMC’s supply chain accounts for another $30bn, according to people briefed on the matter.

Several other Taiwanese companies including Foxconn are expanding US capacity to assemble the servers that power the AI boom. But their factories are much less capital-intensive than advanced chip plants, known as fabs. They are expected to cost no more than $20bn, leaving a $100bn gap only TSMC could fill.

“In the Taiwan trade deal, the whole shooting match is TSMC,” said a semiconductor industry insider.

TSMC had previously announced plans to pour $165bn into the construction in Arizona of six fabrication plants, two advanced packaging plants — where chips are assembled into a bigger device such as an Nvidia processor — and a research and development facility. It started volume production for Nvidia and Apple at the first of these plants in late 2025.

But TSMC would “come in huge, bigger”, Lutnick said last month, referring to reports the company’s US presence might double. “The objective is to bring 40 per cent of Taiwan’s entire [chip] supply chain and production to America during President Trump’s term.”

Two people familiar with TSMC’s plans said it would invest another $100bn in the construction of four more fabs.

That figure aligns with analysts’ calculations of what else TSMC needs to build in the US for all its chip sales to American customers to remain tariff-free. Under the US-Taiwan agreement, companies building plants in the US can import 2.5 times the facilities’ planned capacity, free of national security tariffs, during construction. After the plants start production, Taiwanese investors will still get a chip tariff exemption quota of 1.5 times those plants’ capacity.

“TSMC’s $165bn commitment covers tariff-free imports through 2032 under the narrow interpretation that covers only direct chip imports,” said Sravan Kundojjala, an analyst at consultancy SemiAnalysis. “Post-2032, the loss of the 2.5x construction multiplier as fabs complete creates a gap requiring four additional fabs by 2035 to maintain full coverage.”

Kundojjala believes TSMC’s land deals in Arizona suggest expansion of such scale. The company recently acquired 900 acres of land, adjacent to the 1,100-acre plot where it has one operational fab, one completed fab shell and a third fab under construction.

TSMC chief executive CC Wei told investors last month it would “expand the many fabs” in Arizona. TSMC said the original plot was not large enough for facilities planned under the $165bn investment. But it would not clarify how much of the new plot will be filled with already-announced investment.

In Taiwan, TSMC’s cutting-edge fabs are in much smaller, tightly-packed campuses. In the southern city of Tainan, it operates more than 15 fabs on a site less than a quarter the size of its total Arizona plot. While the buildings with the clean rooms are of similar size, space in Arizona is taken up by other facilities such as car parks, which are built underground in Taiwan.

Another comparison is with Intel, TSMC’s American rival and customer, which plans eight fabs on a 1,000-acre site in Ohio. Kundojjala estimated that TSMC’s area per fab would run up to 50 per cent larger, probably reflecting bigger clean rooms, on-site water recycling and dedicated chemical and gas plants.

“After accounting for one fab spillover from the original plan, we estimate TSMC can build four more fabs on the remaining 720 acres at 180 acres per fab,” Kundojjala said.

The total Arizona campus could support up to 10 fabs, at least two advanced packaging centres and one R&D centre on a 2,000-acre footprint, he suggested.

Even if TSMC eventually expands to that scale, observers believe that its US footprint will remain small compared with Taiwan for many years. The company previously said it expected to have 30 per cent of its most advanced chipmaking capacity — producing chips of 2 nanometres and below — in the US when its Arizona complex is fully built up in the early 2030s.

But its simultaneous expansion in Taiwan means that this might be a ceiling. Cheng this week said it was “impossible” to achieve Lutnick’s 40 per cent goal.

The Trump administration’s idea to exempt big US tech companies from future chip tariffs through quotas earned with new TSMC capacity onshore ensures that companies like Nvidia keep pushing their Taiwanese chip supplier to build more.

However, huge uncertainties remain. Only $8.2bn of Taiwan’s $198bn in exports to the US last year were standalone semiconductors. The vast majority of the chips that TSMC and other Taiwanese chipmakers sell to US customers are assembled into other devices such as server modules or smartphones in factories in Taiwan, India, south-east Asia or Mexico before crossing the US border.

According to experts, importers are unlikely to be able to report the value of the chips built into the final products they bring in. One industry executive said: “I will only believe that US customs can collect those tariffs when I see it.”