US President Donald Trump’s 90-day pause on most tariffs gives breathing space for more in-depth talks, and Taiwan hopes to take advantage of the “huge” US market for more balanced trade, Minister of Foreign Affairs Lin Chia-lung (林佳龍) said yesterday.
The US’ baseline tariff of 10 percent is to remain in place, but the additional 22 percent tariff has been suspended for 90 days, Lin said during a legislative hearing.
Democratic Progressive Party (DPP) Legislator Wang Ting-yu (王定宇) asked whether the 75-plus countries that had proposed talks with the US instead of taking retaliatory actions had all been listed for the 90-day pause.
Photo: CNA
Lin said he had confirmed with the US that Taiwan was on the list, but he was not sure about the other countries.
“The temporary baseline 10 percent tariff is now giving Taiwan a relative advantage point [pending further talks],” Lin said.
On Wednesday last week, Trump announced a universal baseline tariff of 10 percent on all imports to the US and higher rates on trading partners the White House deemed the “worst offenders” in “unfair trade practices,” including Taiwan.
In anticipation of the 32 percent tariff on imports from Taiwan, which took effect briefly on Wednesday, the government had been preparing for the economic consequences.
However, in a dramatic turn on Wednesday, Trump said he was pausing the “reciprocal” tariffs on the targeted countries for 90 days, except for China, which is to be subject to a 125 percent tariff.
Prior to yesterday’s legislative session, Lin told reporters that Taiwan was prepared to engage in talks with the US on the tariff issue.
Trump’s latest announcement of a 90-day pause would give both sides more time to prepare for “deeper, more thorough” bilateral negotiations on the issue, he said.
The negotiation team is led by Vice Premier Cheng Li-chiun (鄭麗君) and includes members from the Office of Trade Negotiations, as well as national security and foreign affairs agencies, the Cabinet said.
On Wednesday, Lin said that Taipei was in contact with the US, which has “officially acknowledged our outreach.”
“Taiwan has been included on the list for upcoming trade talks,” he said, without elaborating.
Lin did not provide a timeline for the negotiations.
However, he said that the two sides had been exchanging information, with the US requesting additional data from Taiwan, which the government was in the process of providing.
The government is also looking to boost purchases from the US to narrow the trade deficit.
Minister of Economic Affairs J.W. Kuo (郭智輝) told lawmakers that state-backed bodies could purchase an additional US$200 billion of goods from the US over the next decade, including a one-third increase in the share of liquefied natural gas (LNG) imported from the country.
That does not include purchases by private companies, he added.
Asked about raising the proportion of Taiwan’s imports of LNG from 10 percent of the total, Kuo said that was the “direction” being eyed.
Most of Taiwan’s LNG comes from Australia and Qatar.
Central bank Governor Yang Chin-long (楊金龍) told lawmakers that the formula used by the US to calculate “reciprocal” tariffs is unreasonable and too rough, but emphasized that it targets all countries globally, not Taiwan specifically.
Trump did not take into account the fact that Taiwan’s trade surplus with the US was because of his country’s need for Taiwan’s products, he said, adding that Taiwan has contributed to the US’ productivity and economy.
Yang said that a suggestion from legislators that the central bank use Taiwan’s holdings of US Treasury securities as a bargaining chip was a “good idea.”
If Taiwan enters negotiations with the US, it should highlight that while the US has to issue government bonds to finance its deficits, Taiwan’s long-term investment in US Treasuries plays a key role in helping to lower US borrowing costs, he added.
Additional reporting by Reuters
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