Taiwanese manufacturers of semiconductor chips, essential components for everything from medical devices to mobile phones, have announced billions of dollars of new investments in the United States in recent months, while they shutter or scale back operations in mainland China. The moves come as the rivalry between Beijing and Washington intensifies, and reflect Taiwan’s efforts to reduce its economic reliance on and insulate itself from pressure from China, while bolstering its economic and trade ties with its top ally, the United States. The United States replaced mainland China as Taiwan’s top export destination in the first quarter of this year, for the first time since 2016. The island exported $24.6 billion worth of goods to the United States in the first three months of the year, compared with $22.4 billion to mainland China, according to Taiwan government data. Taiwanese investment in mainland China fell by nearly 40 percent to a more than two-decade low of $3 billion last year, according to Taiwan’s Ministry of Economic Affairs. Taiwanese investment in the United States jumped ninefold to $9.6 billion in 2023. Washington and Taipei signed a trade agreement last year and are now negotiating a follow-on pact. U.S. lawmakers have also introduced legislation that would end double taxation for Taiwanese companies and workers in the United States. “All of this is driven by a desire to strengthen Taiwan’s deterrence capabilities and resilience, support the maintenance of the status quo, and dissuade China from being tempted to take action against Taiwan,” said Daniel Kritenbrink, the U.S. assistant secretary of state for East Asian and Pacific affairs. The world’s largest chipmaker, Taiwan Semiconductor Manufacturing Co., or TSMC, announced last month that it would expand its investment in the United States to $65 billion. That came after the U.S. government pledged up to $6.6 billion in incentives aimed at creating a facility in Arizona capable of producing about one-fifth of the world’s most advanced semiconductors by 2030. In addition to its U.S. investment, TSMC is also investing in Japan, a close U.S. ally in Asia. Foxconn, a Taiwanese conglomerate best known for assembling iPhones for Apple, is building manufacturing capacity in India, while Pegatron, another Taiwanese company that makes components for iPhones and computers, is investing in Vietnam. King Yuan Electronics Corp., a Taiwanese company that specializes in semiconductor testing and packaging, said last month that it would sell its $670 million stake in a company in the eastern Chinese city of Suzhou. KYEC cited geopolitical friction, U.S. export controls on advanced chips to China and Beijing’s push to achieve technological self-sufficiency. Taiwan’s exports of semiconductors, electronic components and computer equipment to the United States have more than tripled since 2018, reaching nearly $37 billion last year. It’s not just technology: the island has more than tripled its exports of tapioca, for example, in the past five years, and is selling increasing amounts of fruit, nuts and farmed fish to the U.S. market. The recent trade data reflect “a strategy by Taiwan and the U.S. to reorient trade in an effort to reduce risk,” said Hung Tran, a nonresident fellow at the Atlantic Council’s GeoEconomics Center think tank. The combined share of mainland China and Hong Kong in Taiwan’s exports fell to less than one-third in the first quarter of 2023, down from about 44% in 2020. That was “a very big shift,” Tran said. “I think it will probably continue to decline,” he said. Read Next: China anuncia "medidas disciplinares" contra taiwaneses por "boatos" (Portuguese version)