Two of the world's leading chip companies, ASML and TSMC, can remotely disable their advanced chipmaking machines if China invades Taiwan. ASML, a Dutch company, supplies crucial equipment to Taiwan's TSMC, which produces 90% of the world’s most advanced chips. The potential "kill switch" underscores heightened tensions between the US and China, particularly concerning a Chinese invasion of Taiwan. Taiwan is pivotal to global semiconductor production, and any conflict would severely impact the global economy. The US has restricted China's access to advanced AI chips and pressured the Netherlands to limit ASML's exports to China. Amid rising tensions, TSMC is diversifying its production with new plants in Arizona, Japan, and Germany, though these will take time to become operational. The US is also investing in domestic chip production through the CHIPS Act. Despite these efforts, Nvidia CEO Jensen Huang noted the tech sector's continued reliance on Taiwanese manufacturing.
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