Taiwan is trading on its chipmaking strength to win friends abroad, a plus for its standing but also a squeeze on its most valuable industry.

• Taiwan pitched itself at a major chip trade show as the democratic, reliable supplier powering the AI boom.
• Washington remains its key backer, but wants more chip production moved to American soil — TSMC is already spending $265 billion on Arizona plants.
• The US commerce secretary said chipmakers that don't build in America will face tariffs on their chips.
• Taiwan cut a deal earlier this year to invest more in the US for lower tariffs, though the details are still unsettled.
• Europe is courting Taiwanese money too, pushing its new chip law as both sides clash with China and back Ukraine.

Outlook: Taiwan will keep spreading factories across friendly countries, giving up some of its chip edge at home to keep political support abroad.