Taiwan and the US on Thursday signed a trade agreement that caps US tariffs on Taiwanese goods at 15 percent and provides preferential market access for US industrial and agricultural exports, including cars, and beef and pork products.
The Taiwan-US Agreement on Reciprocal Trade confirms a 15 percent US tariff for Taiwanese goods, and grants Taiwanese semiconductors and related products the most-favorable-treatment under Section 232 of the Trade Expansion Act, the Executive Yuan said.
In addition, 2,072 items — representing nearly 20 percent of Taiwan’s total exports to the US — would be exempt from additional tariffs and be subject only to the standard most-favored-nation (MFN) rates, the Executive Yuan added.
Photo: Tien Yu-hua, Taipei Times
The average US tariffs on Taiwanese goods would drop to 12.33 percent, significantly lower than the 35.78 percent that was in place when the trade negotiations began in April last year and the 23.78 percent recorded that August.
Under the exemptions, 42 percent of Taiwan’s agricultural exports and 36 percent of its industrial exports would avoid additional tariffs, the Cabinet said, adding that those included Taiwanese tea, orchids, tapioca flour and telecommunications equipment.
While US negotiators sought broader market access, Taiwan succeeded in maintaining existing tariffs on 27 US agricultural imports, such as rice and chicken, thus reducing the potential impact on farmers, it said.
Photo courtesy of the US Office of the Trade Representative via CNA
Taiwan would cut tariffs on 15 US pork products by half over three years, while US ground beef and offal would also gain access to the Taiwanese market, it said, adding that guarantees about food safety controls would remain in place.
The trade agreement also covers industrial goods, removing all tariffs on US-made cars imported to Taiwan, but maintaining the rate on trucks.
The Office of the US Trade Representative said the agreement would eliminate or reduce 99 percent of tariff barriers for US industrial and agricultural goods exported to Taiwan.
"Taiwan plans to increase long-term purchases of US products, including US$44.4 billion of US liquefied natural gas and crude oil, US$25.2 billion of US power equipment, and US$14.2 billion of US civil aircraft and engines," it said.
US Trade Representative Jamieson Greer and US Secretary of Commerce Howard Lutnick attended the signing of the agreement, which occurred under the auspices of the American Institute in Taiwan, and the Taipei Economic and Cultural Representative Office in the US. Vice Premier Cheng Li-chiun (鄭麗君) and Minister Without Portfolio Yang Jen-ni (楊珍妮) also attended the signing.
“US President [Donald] Trump’s leadership in the Asia-Pacific region continues to generate prosperous trade ties for the United States with important partners across Asia, while further advancing the economic and national security interests of the American people,” Greer said.
At a news conference in Washington after the signing ceremony, Cheng, who led Taiwan’s trade negotiation team, said the agreement was “a milestone” for bilateral cooperation in trade, investment and technology.
Citing Lutnick, Cheng said Taiwan is “a unique partner” of the US, adding that the nation hoped the agreement would make it a strategic partner of the US “so as to jointly consolidate the democratic camp’s leading position in high technology.”
The Executive Yuan said the tariff rate set in the agreement allows local companies to compete on a level playing field with Japan, South Korea and the EU.
In a separate, but related deal, Taiwan would make investments worth US$250 billion in US industries, such as semiconductors, artificial intelligence applications and energy.
The government said it would provide up to US$250 billion in credit guarantees to help businesses invest in the US.
The agreement would now be sent to the legislature for review and approval. Speed would be crucial, given that Trump recently raised tariffs on South Korea after its parliament failed to quickly ratify a similar pact.
Cheng said the US negotiators had proposed making the agreement conditional on legislative approval, but her team had successfully pushed back on that idea.
“We encourage our lawmakers, however, to review and pass the agreement as soon as possible so the new tariff rates can take effect,” she said.
‘UNFRIENDLY’: Changing the nationality listing of Taiwanese residents to ‘China’ goes against EU foreign policy as well as democratic and human rights principles, MOFA said Taiwan yesterday called on Denmark to correct its designation of the nationality of Taiwanese residents as “China” or face retaliatory measures. The Danish government in 2024 changed the nationality of Taiwanese citizens on their residence permits from “Taiwan” to “China.” The decision goes against EU foreign policy and contravenes democratic and human rights principles, Ministry of Foreign Affairs (MOFA) spokesman Hsiao Kuang-wei (蕭光偉) said. Denmark should present a solution acceptable to Taiwan as soon as possible and correct the erroneous designation to preserve the longstanding friendship between the two nations, Hsiao said. The issue could damage Denmark’s image and business reputation in Taiwan,
KEY INDUSTRY: The vice premier discussed a plan to create a non-red drone supply chain by next year, which has been allocated a budget of more than NT$7.2 billion The government has budgeted NT$44.2 billion (US$1.38 billion) to cultivate Taiwan’s uncrewed aerial vehicle (UAV) industry over the next five years, which would make the nation a major player in the industry’s democratic supply chain in the Asia-Pacific region, Premier Cho Jung-tai (卓榮泰) said yesterday. Cho made the remarks during a visit to the facilities of Cub Elecparts Inc (為升電裝). Democratic Progressive Party (DPP) Legislator Chen Su-yueh (陳素月) and Chinese Nationalist Party (KMT) Legislator Hsieh Yi-fong (謝依鳳) also participated in the trip. Cub Elecparts has transitioned from the automotive industry to the defense industry, which is the top priority among the nation’s
SUFFICIENT: The president said Taiwan has enough oil for next month, with reserves covering more than 100 days and natural gas enough for 12 to 14 days A restart plan for the Guosheng Nuclear Power Plant in New Taipei City’s Wanli District (萬里) and the Ma-anshan Nuclear Power Plant in Pingtung County’s Hengchun Township (恆春) would be submitted to the Nuclear Safety Commission by the end of the month, President William Lai (賴清德) said yesterday, reversing the government’s policy to abolish nuclear energy. On May 17 last year, Taiwan shut down its last nuclear reactor and became the first non-nuclear nation in East Asia, fulfilling the Democratic Progressive Party (DPP) government’s pledge of a “nuclear-free homeland.” Even without nuclear power, Taiwan can maintain a stable electricity supply until 2032,
DEROGATORY: WTO host Cameroon’s designation of Taiwan as a ‘province of China’ seriously undermines the nation’s status and rights as a WTO member, MOFA said The Ministry of Foreign Affairs (MOFA) yesterday condemned Cameroon for listing Taiwan as “Taiwan, Province of China” in visa documents for an upcoming WTO ministerial conference, a move that led to Taiwan’s withdrawal from the event. The designation “seriously undermined” Taiwan’s status and rights as a WTO member, the ministry said in a statement. It is the first time since 2001 that Taiwan has declined to attend a WTO Ministerial Conference. The conference is scheduled to take place from Thursday to Sunday next week in Yaounde, the capital of Cameroon. Taiwan had planned to send a delegation led by Minister Without Portfolio
RSS