Taiwan: China rare-earth curbs unlikely to hurt chips

China's recent expansion of rare-earth export controls - adding five elements and tighter scrutiny for chip users - is unlikely to significantly affect Taiwan's semiconductor industry, the island's economy ministry said.

The ministry said the newly covered elements differ from those used in semiconductor fabrication, and that many rare-earth products or derivatives needed domestically are primarily sourced from Europe, the United States and Japan. That supply diversity reduces near-term risk to chipmakers such as TSMC, which produces most advanced logic chips used in AI applications.

Officials warned the broader controls could still disrupt global supply chains for devices that rely on the affected elements, notably electric vehicles and certain drone systems, and require close monitoring. Beijing has defended the measures, citing concerns about military applications of some rare earths amid heightened geopolitical tensions.