> The Looming Taiwan Chip Disaster That Silicon Valley Has Long Ignored If China invades Taiwan and cuts off its chip exports to American companies, the tech industry and

The Looming Taiwan Chip Disaster That Silicon Valley Has Long Ignored

If China invades Taiwan and cuts off its chip exports to American companies, the tech industry and the U.S. economy would be crippled.

https://www.nytimes.com/2026/02/24/tech … -tsmc.html

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Federal officials have for years tried to wean Silicon Valley from its dependence on Taiwan, an island democracy roughly the size of Maryland that makes 90 percent of the world’s high-end computer chips.

In secret briefings held in Washington and Silicon Valley, national security officials warned executives from companies like Apple, Advanced Micro Devices and Qualcomm that China was making plans to retake Taiwan, which Beijing has long considered a breakaway territory. A Chinese blockade of Taiwan, the officials said, could choke the supply of computer chips made on the island and bring the U.S. tech industry to its knees.

Two presidents have tried persuading the industry to change. President Joseph R. Biden Jr. offered financial grants worth billions to improve the domestic production of chips. After that didn’t work, President Trump threatened billions in tariffs to essentially accomplish the same thing.

But warnings, gifts and threats have made little difference. The U.S. tech industry has stubbornly refused to shift where it gets most of its chips, which power things like smartphones, laptops and the giant data centers that run artificial intelligence.

Now, there is increasing concern that inaction by some of Silicon Valley’s most important companies risks destabilizing the global economy. Those worries, drawn into focus by recent live-fire drills conducted by the Chinese military in waters surrounding Taiwan, have prompted dire warnings from White House officials.

“The single biggest threat to the world economy, the single biggest point of single failure, is that 97 percent of the high-end chips are made in Taiwan,” Treasury Secretary Scott Bessent said last month at the World Economic Forum in Davos, Switzerland, slightly overstating industry estimates. “If that island were blockaded, that capacity were destroyed, it would be an economic apocalypse.”

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