President Trump has announced that a Taiwanese company will build a major factory in the United States in what is seen as a blow to China.

According to The Daily Wire:

The Trump administration hit hard against the Chinese Communist Party (CCP) late this week with the announcement that a Taiwan chip manufacturer will be building a plant in the United States and that the move will severely restrict the company’s ability to sell to China’s Huawei.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) announced that it will build a new factory in Arizona as part of a $12 billion deal with the U.S. that will “create over 1,600 high-tech professional jobs directly, and thousands of indirect jobs in the semiconductor ecosystem,” the company said in a statement.

“TSMC welcomes continued strong partnership with the U.S. administration and the State of Arizona on this project,” the company added. “The strong investment climate in the United States, and its talented workforce make this and future investments in the U.S. attractive to TSMC. U.S. adoption of forward-looking investment policies to enable a globally competitive environment for a leading edge semiconductor technology operation in the U.S. will be crucial to the success of this project.”

The plant is “the biggest foreign investment by TSMC,” Reuters notes, and “will produce the most sophisticated 5 nanometer chips, which can be used in high-end defense and communications devices.”

Secretary of State Mike Pompeo has stated that this move bolsters US national security as tensions with China are at an all-time high.