China is pushing back against Taiwan Semiconductor Manufacturing Co. (NYSE:TSM) expanding ties with the United States, accusing Taiwan of trying to "sell out" its chip industry to curry favor with the White House, according to Reuters.

At a news conference in Beijing, China's Taiwan Affairs Office claimed Taiwan's ruling Democratic Progressive Party (DPP) is using its powerful semiconductor industry to strengthen reliance on foreign countries in a bid for independence. The remarks follow former President Donald Trump's accusation that Taiwan took our chip business away, vowing to bring semiconductor production back to the U.S.. In response, Taiwan President Lai Ching-te pledged to increase procurement and investment in the U.S.

The dispute comes as U.S.-China tensions escalate over semiconductor access, AI chip technology, and tariffs. The U.S. trade deficit with Taiwan surged to $73.9 billion last year, largely due to rising semiconductor demand, with TSMC producing chips for major players like Apple (NASDAQ:AAPL) and Nvidia (NASDAQ:NVDA).

Adding to the uncertainty, Trump has ordered a review of global tariff and tax policies, which could lead to 25% tariffs on chips as early as April 2. Meanwhile, reports suggest the White House may tighten Biden-era chip restrictions on China, and TSMC has been rumored to be in talks over a potential stake in Intel (NASDAQ:INTC).