Taiwan says reached ‘general consensus’ with U.S. on trade deal

Taiwan has reached a “general consensus” with the United States on a trade deal, the island’s negotiators announced on Tuesday (January 13, 2025), following months of negotiations.

Also Read | U.S. confirms sale worth $700 million of air defence missile system to Taiwan

Taiwan and the United States began negotiations in April to hash out a trade deal after U.S. President Donald Trump slapped a 32% tariff on Taiwanese exports, which was later lowered to 20%, as part of his sweep of measures against dozens of trade partners.

Taiwanese President Lai Ching-te has pledged to boost investment in the United States and increase defence spending as his government tries to further reduce the levy on its shipments, as well as avoid a toll on its semiconductor chip exports.

“The goal of the U.S.-Taiwan tariff negotiations has always been to seek reciprocal tariff reductions without stacking tariffs, and to obtain preferential treatment under Section 232 for semiconductors, semiconductor derivatives, and other items,” the Office of Trade Negotiations said in a statement, adding there was a “general consensus” on these issues.

Section 232 refers to part of the U.S. Trade Expansion Act that allows tariffs to be imposed when national security is found to be at risk.

“Both sides are currently discussing the schedule for a concluding meeting, and an announcement will be made once it is confirmed,” the statement said.

Taiwan’s trade officials also vowed to provide “a complete explanation of the negotiations and the agreement” to the opposition-controlled parliament and the public.

American soil

Taiwan is a powerhouse in the manufacturing of semiconductor chips, which are the lifeblood of the global economy, as well as other electronics.

Mr. Trump has previously accused Taiwan of stealing the U.S. chip industry, and his administration has made clear it wants more of the critical technology made on American soil.

The U.S. government launched investigations under Section 232 into semiconductors and chip-making equipment last year.

Taiwan’s trade surplus with the United States was the seventh highest of any country in 2024, reaching $73.9 billion.

More than half of its exports to the United States are information and communications technology products, including semiconductors.

Mr. Lai has been at pains to find favour with Mr. Trump, vowing to raise defence spending to more than 3% of GDP this year and 5% by 2030.

TSMC, which is the world’s largest contract chip maker, also has pledged to invest an additional US$100 billion in the United States.

But Taiwanese Deputy Foreign Minister Francois Chih-chung Wu told AFP recently that Taiwan planned to keep making the “most advanced” chips on home soil.