Taipei: Less than 15 percent of Taiwan Semiconductor Manufacturing Company's (TSMC) advanced manufacturing processes are expected to be relocated to the United States by the end of U.S. President Donald Trump's second term, as stated by Lien Hsien-ming, president of the Chung-Hua Institution for Economic Research.

According to Focus Taiwan, Lien made these remarks in a Facebook post in response to recent statements by U.S. Commerce Secretary Howard Lutnick. Lutnick told CNBC that the U.S. aims to bring 40 percent of Taiwan's supply chain to the U.S. before Trump's term concludes in 2029.

TSMC is investing US$65 billion to build three fabs in Arizona, with the first expected to start commercial production in the fourth quarter of 2024. Additionally, the chipmaker has pledged another US$100 billion to construct three more fabs, two IC assembly plants, and a research and development center in the U.S.

Lien, citing TSMC, noted that equipment installation has started at the second Arizona fab, scheduled for mass production in 2027, while construction of the third fab began earlier this year. TSMC is also seeking a permit for a fourth fab. Considering this timeline, Lien believes it is unlikely for TSMC to achieve mass production at the third Arizona fab by the end of Trump's term, or at a fourth facility.

After analyzing TSMC's Arizona schedule and its overall output of advanced chips, Lien estimated that less than 15 percent of the company's high-end processes would be in the U.S. by the end of Trump's presidency. He also mentioned that other semiconductor companies like Intel, Micron, and Samsung are increasing their investments in the U.S., which could alleviate pressure on TSMC from the U.S. government.

Lutnick's comments came as the U.S. and Taiwan signed an agreement to reduce tariffs on Taiwanese goods from 20 percent to 15 percent. Under the agreement, Taiwanese semiconductor, electronics manufacturing service (EMS), artificial intelligence, and energy companies will invest US$250 billion in the United States. Taiwan's government will also provide up to US$250 billion in credit guarantees to support investments in the semiconductor and information and communication technology sectors, as stated by the Cabinet.

However, Lutnick mentioned in the CNBC interview that Taiwan had pledged US$500 billion in U.S. investments, describing this as merely a down payment towards revitalizing the chip industry in America.

Lien urged the public not to be alarmed by Lutnick's remarks, emphasizing that Taiwan has committed only US$250 billion in direct investment, with the remaining US$250 billion being credit guarantees. He added that Lutnick has repeatedly overstated TSMC's investment commitments to put pressure on Taiwan, similar to tactics used with Japan and South Korea.