The 20 percent tariff the US imposed on Taiwanese exports is “not the worst,” as securing a lower rate would have required Taiwan to pay a steep price, Tunghai University economist Darson Chiu (邱達生) said yesterday.
The tariff was higher than expected and far from ideal, but not the worst outcome, as Taiwan’s negotiating team held firm on its bottom line to avoid paying a much higher price, Chiu said.
Otherwise, Taipei could have reached an agreement with Washington for a 15 percent tariff — on par with Japan and South Korea, which are Taiwan’s direct competitors in the global market, he said.
US President Donald Trump’s “reciprocal” tariffs were first unveiled on April 2 as part of a sweeping package that included a proposed 32 percent duty on Taiwanese goods.
While the government has not disclosed details about its negotiations with the US, Chiu said that if Taiwan had agreed to invest US$400 billion in the US, it would have secured a 15 percent tariff — as the market had anticipated — but that investment would have been nearly 50 percent of Taiwan’s GDP last year and could have undermined the nation’s long-term economic development.
Japan has agreed to invest US$550 billion in the US and open its agricultural market, including rice, to US exporters, while South Korea has pledged a US$350 billion investment.
While a 15 percent tariff would have helped Taiwan maintain its competitive edge against Japan and South Korea, it might have come at a cost elsewhere, he said.
Taiwan would need the Legislative Yuan’s approval for any trade agreement with the US, and building domestic consensus would pose a major challenge for the government, Chiu said.
As Taiwan’s main goals during the tariff talks were to protect national and industrial interests, and ensure food security and public health, Chiu said he believed the government had carefully assessed the situation and chose not to make excessive concessions for now, opting instead to pursue further negotiations in the nation’s interest.
Natixis SA senior economist Gary Ng (吳卓殷) said the rate “is not the best outcome, as it is higher than Asian manufacturing powerhouses.”
“While the impact on Taiwan’s high-end semiconductors may be limited, as there are no alternatives with exemptions in place, other sectors can face greater pressure in exporting to the US due to the tariff gap with competitors,” he said.
Hudson Institute senior fellow Jason Hsu (許毓仁) said that “at face value, it is bad, but strategically, it is manageable.”
“If Taiwan can negotiate a bilateral deal quickly and mitigate the tariffs through concessions, investment and procurement, the scenario could transition from punitive to constructive,” Hsu said.
Meanwhile, a source on condition of anonymity said yesterday that Beijing continued to pressure Washington through back channels during tariff negotiations with Taipei, hoping to learn details of Taiwanese investments.
China does not want to see closer Taiwan-US ties, as that would not be in Beijing’s interests, the source said, adding that any trade negotiations between Taipei and Washington would strengthen Taiwan politically and affect cross-strait relations.
Beijing also does not wish to see Taiwan-US trade talks conclude sooner than US-China trade talks, nor does it wish to see Washington and Taipei use the opportunity to take bilateral commerce to the next level, the source said.
Additional reporting by Su Yung-yao and Bloomberg
Eight Chinese naval vessels and 24 military aircraft were detected crossing the median line of the Taiwan Strait between 6am yesterday and 6am today, the Ministry of National Defense said this morning. The aircraft entered Taiwan’s northern, central, southwestern and eastern air defense identification zones, the ministry said. The armed forces responded with mission aircraft, naval vessels and shore-based missile systems to closely monitor the situation, it added. Eight naval vessels, one official ship and 36 aircraft sorties were spotted in total, the ministry said.
INCREASED CAPACITY: The flights on Mondays, Wednesdays, Fridays and Sundays would leave Singapore in the morning and Taipei in the afternoon Singapore Airlines is adding four supplementary flights to Taipei per week until May to meet increased tourist and business travel demand, the carrier said on Friday. The addition would raise the number of weekly flights it operates to Taipei to 18, Singapore Airlines Taiwan general manager Timothy Ouyang (歐陽漢源) said. The airline has recorded a steady rise in tourist and business travel to and from Taipei, and aims to provide more flexible travel arrangements for passengers, said Ouyang, who assumed the post in July last year. From now until Saturday next week, four additional flights would depart from Singapore on Monday, Wednesday, Friday
The Ministry of National Defense yesterday reported the return of large-scale Chinese air force activities after their unexplained absence for more than two weeks, which had prompted speculation regarding Beijing’s motives. China usually sends fighter jets, drones and other military aircraft around the nation on a daily basis. Interruptions to such routine are generally caused by bad weather. The Ministry of National Defense said it had detected 26 Chinese military aircraft in the Taiwan Strait over the previous 24 hours. It last reported that many aircraft on Feb. 25, when it spotted 30 aircraft, saying Beijing was carrying out another “joint combat
The Ministry of Foreign Affairs (MOFA) today said that if South Korea does not reply appropriately to its request to correct Taiwan’s name on its e-Arrival card system before March 31, it would take corresponding measures to alter how South Korea is labeled on the online Taiwan Arrival Card system. South Korea’s e-Arrival card system lists Taiwan as “China (Taiwan)” in the “point of departure” and “next destination” fields. The ministry said that it changed the nationality for South Koreans on Taiwan’s Alien Resident Certificates from “Korea” to “South Korea” on March 1, in a gesture of goodwill and based on the
RSS