Taiwan’s Economy Minister Kuo Jyh-huei announced on Thursday that Taiwan Semiconductor Manufacturing Co. (TSMC) would require government approval for any overseas joint ventures, although there are no restrictions on manufacturing advanced chips abroad, except for China. This comes amid reports that TSMC is in talks to acquire a stake in Intel, a move that could stir tensions with the US, where former President Trump has expressed concerns about Taiwan taking away American semiconductor business.
Kuo reassured reporters in Taipei that Taiwan’s semiconductor industry, particularly TSMC, remains vital to the nation’s economy, describing it as the ‘sacred mountain protecting the country.’ He also clarified that while the Taiwanese government would not interfere with TSMC’s business decisions, any large overseas investments or joint ventures must be approved by Taiwan’s economy ministry, with no changes to the rules surrounding advanced chip production outside of China.
TSMC is already investing $65 billion in new factories in Arizona, where it plans to manufacture the most advanced 2-nanometre chips, though this will not occur for a few years. The government is also preparing to engage in discussions with the Trump administration over potential tariffs on Taiwanese imports, aiming to secure the best conditions for local companies in light of the ongoing trade tensions.
For more information on these topics, visit diplomacy.edu.
In his blog, ‘Soft Power at a Crossroads: The Implications of USAID’s Closure,’ Jovan Kurbalija, executive director of Diplo, explores the impact of the Trump administration’s decision to shut down the United States Agency for International Development (USAID). Founded in 1961, USAID was a cornerstone of American soft power, channelling billions in aid to promote global development and humanitarian relief.
Its closure marks a dramatic shift in US foreign policy, raising concerns about the future of American influence abroad. The decision to dismantle USAID came amid accusations of inefficiency and mismanagement, with figures like Elon Musk calling the agency corrupt and bloated.
The administration’s plan to fold USAID’s functions into the State Department aligned with Trump’s ‘America First’ agenda, prioritising national interests over global development efforts. Yet, critics argue that this move undermines decades of diplomatic goodwill and leaves vulnerable populations without critical aid, from landmine clearance in Asia to refugee support in conflict zones.
Kurbalija indicates that the vacuum in the USA ‘soft power’ could be filled by other global actors including China, EU, India, Turkie, and Russia. He also questions the future of soft power itself—will persuasion and public digital diplomacy still matter in a world dominated by hard power and geopolitical competition? As the US steps back from its humanitarian role, the international balance of influence may enter an era of profound change.
For more information on these topics, visit diplomacy.edu.
Instagram is considering launching a separate app for its Reels feature, which focuses on short-form videos, according to remarks made by Instagram chief Adam Mosseri this week. The potential move is seen as an effort to capitalise on the uncertain future of TikTok in the US, aiming to offer a similar video-scrolling experience. Meta, the parent company of Instagram, has yet to comment on the report.
This comes just months after Meta introduced a new video-editing app, Edits, in January, which appears to target users of CapCut, a popular video editor owned by TikTok’s parent company, ByteDance. Meta’s previous attempt to launch a standalone video-sharing app, Lasso, in 2018 failed to gain traction and was eventually discontinued.
By exploring a dedicated app for Reels, Instagram hopes to strengthen its position in the competitive short-form video market, where TikTok currently dominates.
For more information on these topics, visit diplomacy.edu.
China’s embrace of DeepSeek’s AI models has expanded beyond tech companies into everyday household appliances. The startup, based in Hangzhou, has seen a surge of support from Chinese manufacturers, with home appliance giants such as Haier, Hisense, and TCL Electronics announcing plans to incorporate DeepSeek’s AI models into their products. These appliances, already equipped with voice-activated commands, are set to become even smarter with DeepSeek’s models, which promise greater accuracy and functionality.
DeepSeek has made waves in the AI sector this year, with its large language models competing against Western systems but at a fraction of the cost. This has sparked immense pride in China, where the company is seen as a testament to the country’s growing tech capabilities in the face of US efforts to limit its advancements. The company’s founder, Liang Wenfeng, has received significant recognition from Chinese authorities, and DeepSeek is expected to soon release its next-generation R2 reasoning model.
The impact of DeepSeek’s technology is already being felt across industries. From robotics to smart appliances, its AI models offer improved precision in tasks such as obstacle avoidance in robot vacuum cleaners. These devices are expected to better understand complex commands, like ‘Gently wax the wooden floor in the master bedroom but avoid the Legos,’ making everyday life more efficient and intuitive.
For more information on these topics, visit diplomacy.edu.
Baidu is set to launch the next generation of its Ernie AI model, the Ernie 4.5, in mid-March. This upgraded version will feature improved reasoning capabilities and enhanced multimodal functions, allowing it to process and integrate a variety of data formats, including text, images, audio, and video. Baidu also plans to make the Ernie 4.5 series open source from June 30, marking a significant shift in its approach to AI development.
The Chinese tech giant has faced fierce competition in the AI race, particularly from the rising startup DeepSeek, whose models are seen as rivals to leading US systems at a much lower cost. Despite claiming that Ernie’s performance is comparable to OpenAI’s GPT-4, Baidu has struggled to gain widespread adoption of its AI model. The emergence of DeepSeek has further complicated Baidu’s aspirations in the sector, leading the company to reassess its strategy.
Baidu’s CEO, Robin Li, who once advocated for keeping AI models closed-source, has acknowledged the success of DeepSeek and other competitors. He now views the open-source approach as essential for the future of AI development. This shift comes as Baidu continues to compete with other tech giants, including Alibaba, which recently announced its plans to make its video and image-generating AI model, Wan 2.1, open source.
For more information on these topics, visit diplomacy.edu.
China accused Taiwan on Wednesday of attempting to hand over its semiconductor industry to the United States, claiming that the island’s government was using the industry to gain political support from Washington. The accusation comes amid reports that Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, may be negotiating a stake in Intel. However, neither TSMC nor Intel has confirmed the talks and Taiwan’s government says it has not received such investment proposals from TSMC.
China’s Taiwan Affairs Office spokesperson, Zhu Fenglian, suggested without providing evidence that Taiwan’s ruling Democratic Progressive Party (DPP) was using TSMC to seek foreign support for independence, accusing the island of ‘selling out’ its companies to the US. Taiwan, however, rejected these claims, with Taiwan’s Mainland Affairs Council affirming the importance of TSMC to the island’s economy and stressing its commitment to maintaining a leading role in semiconductor technology.
The US has been critical of Taiwan’s semiconductor industry, with former President Donald Trump calling for more manufacturing to return to the United States. Despite China’s claims, Taiwan maintains that it is responsible for its foreign investment decisions. The island continues to rely on the US for military support, though the US does not formally recognise Taiwan’s government.
TSMC, which supplies major companies like Apple and Nvidia, did not comment on the reports. Taiwan’s government, however, vowed to support the company amid rising tensions surrounding its semiconductor industry.
For more information on these topics, visit diplomacy.edu.
Canada’s telecommunications regulator, the CRTC, announced on Wednesday that it will impose a fee on Google to cover the costs of enforcing the Online News Act, which requires large tech platforms to pay for news content shared on their sites. The levy, which will be implemented from April 1, will vary each year and has no upper limit. This move comes amid rising tensions between Canada and the US over issues like trade and a digital services tax on American tech firms.
The CRTC stated that most of its operations are funded by fees from the companies it regulates, and the new charge aims to recover costs related to the law. Google, which had previously raised concerns about the fairness of such a rule, had argued that it was unreasonable to impose 100% of the costs on one company. Despite this, Google has agreed to pay C$100 million annually to Canadian publishers in a deal that ensures its search results continue to feature news content.
The law, which is part of a global trend to make internet giants pay for news, was introduced last year in response to concerns that tech firms were crowding out news businesses in the online advertising market. While both Google and Meta were identified as major platforms required to make payments, Meta chose to block news from its platforms in Canada instead. Google, however, has continued to negotiate with the Canadian government, although it has yet to comment further on the CRTC’s decision.
For more information on these topics, visit diplomacy.edu.
A US judge ruled that Meta must face a lawsuit alleging it prioritises hiring foreign workers to pay them lower wages. The proposed class action involves three US citizens who claim they were repeatedly rejected despite being qualified for roles at the company.
The plaintiffs argue that Meta systematically favours visa holders, citing statistics showing a significant portion of its US workforce holds H-1B visas. The company denies the claims, stating there is no evidence of intentional discrimination or that the plaintiffs would have been hired otherwise.
A 2021 settlement saw Meta agree to pay up to $14.25 million over similar government allegations. The latest ruling follows a 2023 appeals court decision, which cited a Civil War-era law protecting US citizens from discrimination in contracts.
Plaintiffs hope the lawsuit will expose widespread hiring biases in the tech sector. Their legal team suggests further enforcement or legislative action may be necessary to address the issue.
For more information on these topics, visit diplomacy.edu.
Meta Platforms is reportedly in talks to build a new data centre campus for its AI projects, potentially costing over $200 billion, according to sources familiar with the matter. The company is considering locations in states like Louisiana, Wyoming, and Texas, with senior executives visiting potential sites this month.
This comes as the AI sector sees a surge in investment, especially following the launch of Microsoft-backed OpenAI’s ChatGPT in 2022. Companies are eager to incorporate AI into their products, leading to significant spending on AI infrastructure.
Despite the report, a Meta spokesperson denied the claims, stating that its data centre plans and capital expenditures have already been disclosed and calling the rest ‘pure speculation’. Meta’s CEO, Mark Zuckerberg, had previously mentioned that the company plans to invest up to $65 billion this year to expand its AI infrastructure.
In comparison, Microsoft has pledged around $80 billion in data centre investments for fiscal 2025, while Amazon has indicated its 2025 spending could exceed $75 billion.
For more information on these topics, visit diplomacy.edu.
Italy is demanding 12.5 million euros ($13 million) from Elon Musk’s social network X following a tax probe linked to a broader investigation into Meta. The case, which focuses on value-added tax (VAT) claims for the years 2016 to 2022, is significant as it raises questions about how social networks provide access to their services. Italian tax authorities argue that user registrations on platforms like X, Facebook, and Instagram should be considered taxable transactions, as they involve the exchange of personal data for a membership account.
This case could have major implications for the tech sector in Europe, potentially altering the way business models are structured in the 27-nation European Union, as VAT is a harmonised EU tax. Although the claim of 12.5 million euros is a small amount for X, the outcome of this case could influence future tax policies across the region. Both X and Meta must respond to the tax authority’s observations by late March or early April, with the option to either accept the charges or challenge them in court.
The investigation also comes at a sensitive time, as US President Donald Trump has criticised digital taxes in countries like Italy that target US tech firms. Musk, who has strong ties with Italian Prime Minister Giorgia Meloni, is also keen to expand his Starlink business in the country. If no agreement is reached, Italy’s Revenue Agency may pursue a lengthy judicial review, which could take up to 10 years to resolve.
For more information on these topics, visit diplomacy.edu.
