Taiwan’s exclusion from the Regional Comprehensive Economic Partnership (RCEP) would have little effect on local exporters, because most firms already have a presence in Southeast Asia to take advantage of the favorable tariff terms there, government officials said yesterday.
Fifteen Asia-Pacific nations on Sunday signed the free-trade deal to form a trade bloc that accounts for nearly 30 percent of global GDP.
Minister of Finance Su Jain-rong (蘇建榮) told a meeting of the legislature’s Finance Committee that tariffs are already exempted on about 70 percent of Taiwanese shipments to RCEP markets.
Photo: Chien Jung-feng, Taipei Times
“The formation of the trade body, which is to expand the scope of tariff concessions [between the 15 member nations] from the current 90 percent to 92 percent, would have a very limited impact on Taiwan’s competitiveness,” Su said.
The difference of 2 percentage points is mild, he added.
Lawmakers from across party lines voiced concern that Taiwan would be marginalized internationally after failing to join the trade body and because of the transition in power in the US after US President Donald Trump lost the election.
RCEP members have negotiated trade terms for the past eight years during which time major Taiwanese companies have made inroads in ASEAN markets, giving them access to free trade, Su said.
The government has also encouraged local companies to diversify their investments beyond China under the New Southbound Policy, he added.
The National Development Council shared similar observations, saying that Taiwan-made semiconductors make up 60 percent of shipments to RCEP destinations and there is no tariff on semiconductors and related products due to international technology pacts and protections.
Some RCEP member nations have lowered tariffs to zero for particular technology products to remain competitive globally, the council said in a statement, explaining why tariffs are already not charged on about 70 percent of Taiwanese exports.
US-China trade tensions and the COVID-19 pandemic have awakened companies to the need for risk diversification and the danger of overdependence on a single market, the council said.
As a result, companies are restructuring their supply chains and speeding up digital transformation, it said.
Global supply realignment and the ability to develop a digital economy might become more important and relevant to supporting the economy than tariff reductions, the council said.
ELECTRONICS BOOST: A predicted surge in exports would likely be driven by ICT products, exports of which have soared 84.7 percent from a year earlier, DBS said DBS Bank Ltd (星展銀行) yesterday raised its GDP growth forecast for Taiwan this year to 4 percent from 3 percent, citing robust demand for artificial intelligence (AI)-related exports and accelerated shipment activity, which are expected to offset potential headwinds from US tariffs. “Our GDP growth forecast for 2025 is revised up to 4 percent from 3 percent to reflect front-loaded exports and strong AI demand,” Singapore-based DBS senior economist Ma Tieying (馬鐵英) said in an online briefing. Taiwan’s second-quarter performance beat expectations, with GDP growth likely surpassing 5 percent, driven by a 34.1 percent year-on-year increase in exports, Ma said, citing government
UNIFYING OPPOSITION: Numerous companies have registered complaints over the potential levies, bringing together rival automakers in voicing their reservations US President Donald Trump is readying plans for industry-specific tariffs to kick in alongside his country-by-country duties in two weeks, ramping up his push to reshape the US’ standing in the global trading system by penalizing purchases from abroad. Administration officials could release details of Trump’s planned 50 percent duty on copper in the days before they are set to take effect on Friday next week, a person familiar with the matter said. That is the same date Trump’s “reciprocal” levies on products from more than 100 nations are slated to begin. Trump on Tuesday said that he is likely to impose tariffs
HELPING HAND: Approving the sale of H20s could give China the edge it needs to capture market share and become the global standard, a US representative said The US President Donald Trump administration’s decision allowing Nvidia Corp to resume shipments of its H20 artificial intelligence (AI) chips to China risks bolstering Beijing’s military capabilities and expanding its capacity to compete with the US, the head of the US House Select Committee on Strategic Competition Between the United States and the Chinese Communist Party said. “The H20, which is a cost-effective and powerful AI inference chip, far surpasses China’s indigenous capability and would therefore provide a substantial increase to China’s AI development,” committee chairman John Moolenaar, a Michigan Republican, said on Friday in a letter to US Secretary of
‘REMARKABLE SHOWING’: The economy likely grew 5 percent in the first half of the year, although it would likely taper off significantly, TIER economist Gordon Sun said The Taiwan Institute of Economic Research (TIER) yesterday raised Taiwan’s GDP growth forecast for this year to 3.02 percent, citing robust export-driven expansion in the first half that is likely to give way to a notable slowdown later in the year as the front-loading of global shipments fades. The revised projection marks an upward adjustment of 0.11 percentage points from April’s estimate, driven by a surge in exports and corporate inventory buildup ahead of possible US tariff hikes, TIER economist Gordon Sun (孫明德) told a news conference in Taipei. Taiwan’s economy likely grew more than 5 percent in the first six months