Chinese Nationalist Party (KMT) caucus whip Fu Kun-chi yesterday urged President William Lai (賴清德) to convene a national conference as soon as possible in response to the 20 percent tariff on Taiwanese goods the White House announced on Thursday.
Speaking at a news conference, Fu said the tariff poses a severe challenge to Taiwanese industries, which must compete with Japan and South Korea, both of which benefit from a lower 15 percent tariff.
Eighty-five percent of Taiwan’s industries are export-oriented, with most having a gross profit margin of about 10 percent, and now face the double squeeze of an appreciating New Taiwan dollar and tariffs, Fu said.
Photo: Chen Yi-kuan, Taipei Times
KMT Chairman Eric Chu (朱立倫) called the rate a “significant defeat” for Taiwan.
“The 20 percent tariff rate plus the New Taiwan dollar’s 12 percent appreciation” pose a significant threat to Taiwan’s export industry, Chu wrote on Facebook.
The biggest failure is that the government lacked a concrete strategy and direction for tariff negotiations, leaving businesses in the dark, while a loss in confidence in Taiwanese industries would impact the nation’s competitiveness, he added.
“Faced with the government’s inaction,” the opposition is doing its utmost to propose countermeasures, he said, adding that a special act responding to the tariffs should take effect immediately.
The legislature last month passed the third reading of the Special Act for Strengthening Economic, Social and National Security Resilience in Response to International Circumstances (因應國際情勢強化經濟社會及國土安全韌性特別條例), which would allocate NT$545 billion (US$18.15 billion) to counter the effects of the tariffs, including a cash handout of NT$10,000 each for all Taiwanese.
There should be no more stalling or seeking of a constitutional interpretation, and the cash handouts should be issued before October to stabilize domestic demand, boost consumer confidence and quickly stabilize Taiwan’s economic resilience, Chu said.
The KMT mayors of four special municipalities also called on the central government to negotiate a more favorable tariff rate.
Taichung Mayor Lu Shiow-yen (盧秀燕) said the tariffs would have a significant impact on Taiwanese industries and could trigger ripple effects throughout the domestic economy.
Taipei Mayor Chiang Wan-an (蔣萬安) said the Executive Yuan had previously stated that Taiwan’s tariffs “would not be higher than those of rival countries.”
The outcome has clearly proven otherwise, he said.
Taoyuan Mayor Simon Chang (張善政) said that although the 20 percent tariff is a significant drop from the 32 percent that the US announced in April, the rate remains challenging compared with the 15 percent imposed on competing nations, such as Japan and South Korea.
Key details, such as how much Taiwan must invest in the US or whether the nation would be required to open its market to certain imports, remain unclear, he added.
Lai owes the public an explanation as to what he meant by “tentative” when he referred to the 20 percent tariff, New Taipei City Mayor Hou You-yi (侯友宜) said.
At the Legislative Yuan, Democratic Progressive Party (DPP) caucus chief executive Rosalia Wu (吳思瑤) said that negotiations between Taiwan and the US were still ongoing.
Wu urged all sectors to refrain from being pessimistic and instead rally behind Taiwan, regardless of political affiliation.
The opposition is using Japan and South Korea as benchmarks, but the two nations were initially handed tariffs of 24 and 25 percent respectively last month, she said.
Japan and South Korea failed to reduce tariffs by more than 10 percentage points, but Taiwan negotiated the rate down by 12 percentage points, she said, adding that the result shows the hard work of the nation’s tariff negotiating team, which did not fall short of Japan’s or South Korea’s efforts.
Taiwan People’s Party (TPP) Chairman Huang Kuo-chang (黃國昌) described the government negotiations with the US as a “black box” affair, urging Lai to explain what deals were made following the announcement of the 20 percent tariff on Taiwan.
The TPP caucus is inviting representatives from all parties to discuss the tariff matter at 9am on Monday, he said, urging the DPP to stop shielding the government and immediately join calls for the Executive Yuan to come to the legislature to provide an explanation.
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