Taipei goals to decrease Trump-era tariffs and safe sectoral exemptions for semiconductors and tech items.
The announcement comes after U.S. President Donald Trump signed an govt order Thursday imposing tariffs between 10% and 41% on imports from a number of international locations, with Taiwan hit by a 20% levy — decrease than the beforehand threatened 32%, however nonetheless greater than charges secured by Japan (15%), South Korea, and the European Union.
“The 20% tariff rate was never Taiwan’s target to begin with. We will continue negotiations and strive for a more favorable rate,” mentioned Lai at a press briefing.
A U.S. official confirmed that talks are ongoing and described Taiwan’s proposal as “well received,” including {that a} ultimate settlement seems to be shut.
A key sticking level is tariffs on semiconductors and superior tech merchandise — sectors essential to Taiwan’s economic system and nationwide identification. These items are below assessment as a part of a U.S. nationwide safety investigation below Section 232 of the Trade Expansion Act of 1962, which might end in greater, non-reciprocal tariffs.
Taiwan’s high chipmakers, together with TSMC (2330.TW), are intently watching the result, with a ultimate U.S. determination anticipated inside two weeks, in accordance with Commerce Secretary Howard Lutnick.
“If the tariff rate is too low, companies will continue manufacturing abroad and simply absorb the costs,” mentioned Yusuf Huang of Neuberger Berman, noting that Trump’s reshoring purpose might push ultimate chip tariffs even greater.
Analysts say the 20% fee would apply to solely about 25% of Taiwan’s exports to the U.S., largely affecting equipment, plastics, and lower-end manufacturing — in accordance with a leaked report from Taiwan’s Ministry of Economic Affairs.
Much of Taiwan’s high-end tech manufacturing is now positioned in Southeast Asia and Mexico, which means these items might fall below totally different tariff classes.
Yuanta Securities described the present tariffs as simply the “first battle” in a bigger commerce standoff between Washington and Taipei, with extra readability anticipated as soon as the chip-specific Section 232 probe concludes.
Taiwan recorded a $74 billion commerce surplus with the U.S. in 2024 — the sixth-largest amongst U.S. buying and selling companions.
