The decision by the US to impose additional tariffs on US$50 billion worth of Chinese goods will not have an adverse effect on Taiwanese machinery makers operating in China, an industry association said on Saturday.
Taiwanese machine tool firms’ China-based production facilities generally supply the Chinese market rather than export markets, such as the US, Taiwan Association of Machinery Industry chairman Alex Ko (柯拔希) said.
“Taiwanese machinery exporters tend to produce products for the US market in Taiwan,” Ko said. “So the additional tariffs on Chinese goods will not affect Taiwanese machinery exports to the US.”
Ko was responding to an announcement by US President Donald Trump on Friday that his administration would on July 6 impose an additional 25 percent tariff on Chinese goods, including machinery, robotics, aerospace items, information technology devices and auto products.
China responded with retaliatory tariffs that would also take effect on July 6 and would target US$50 billion worth of US products, including agricultural products, motor vehicles and seafood.
Goodway Machine Corp (程泰機械) chairman Edward Yang (楊德華) said that the products his company manufactures in China are mostly bound for the Chinese market, adding that he is not worried about the trade friction for the time being.
As for Taiwanese information technology suppliers, Ray Yang (楊瑞臨), a deputy division chief at the Industrial Economics and Knowledge Center, said they should diversify their investments and broaden their global production networks.
Globalization is expected to help the suppliers avoid a trade war between the US and China, as it would allow them export their products to the US through a third nation, Yang said.
As the US tariffs would not target consumer electronics products, such as smartphones and TV sets, their effect on Taiwanese businesses would be limited, Taiwan Institute of Economic Research (台灣經濟研究院) economist Gordon Sun (孫明德) said.
The US and China are still open to negotiations, Chung-Hua Institution for Economic Research (中華經濟研究院) head economic researcher Liu Meng-chun (劉孟俊) said, adding that he does not think Washington will engage in an all-out tariff war with Beijing.
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