Taiwan plans to keep making the "most advanced" chips on home soil and remain "indispensable" to the global semiconductor industry, the deputy foreign minister told AFP, despite intense Chinese military pressure.

The democratic island makes more than half of the world's chips, and nearly all of the most advanced ones, that power everything from smartphones to AI data centres.

Its dominance of the industry has long been seen as a "silicon shield" protecting it from an invasion or blockade by China -- which claims the island is part of its territory -- and an incentive for the United States to defend it.

But the threat of a Chinese attack has fuelled concerns about potential disruptions to global supply chains and has increased pressure for more chip production beyond Taiwan's shores.

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