The US and Taiwan signed an agreement to reduce import tariffs to 15%, along with certain tax exemptions, in exchange for Taiwanese technology giants injecting at least $250 billion (about 7.84 trillion baht) in investments in the US to secure semiconductor and AI supply chains. The goal is to reduce reliance on external sources and build a self-reliant domestic production base.
The US Department of Commerce announced it had reached an agreement with Taiwan to lower import tariffs on Taiwanese goods from 20% to 15%. The original 20% tariff was a retaliatory measure used by the US government to address trade imbalances.
Key points of the agreement include capping tariffs on automotive parts, processed wood, and wood products at no more than 15%, while certain generic drugs and some natural resources will receive full exemption from retaliatory tariffs.
Taiwan's chip and technology sectors have agreed to directly invest at least $250 billion (approximately 7.84 trillion baht) in the US to expand advanced semiconductor and AI production capacity.
Additionally, the Taiwanese government will provide loan guarantees of at least $250 billion to support Taiwanese businesses expanding their manufacturing bases in America.
Howard Lutnick, US Secretary of Commerce, said the main goal is to relocate over 40% of Taiwan’s supply chains and manufacturing to US soil, enabling the US to be self-sufficient in chip technology, which he described as the "lifeblood" of the global economy.
Lutnick also mentioned that TSMC, the world’s largest chipmaker, has purchased several hundred acres of land adjacent to its existing factory in Arizona, which is expected to be part of the production expansion under this agreement.
Taiwanese Premier Chou Ching-tai praised the negotiation team’s success as an excellent "home run," emphasizing that this progress was hard-won. Meanwhile, industry players such as machinery manufacturers noted that although reducing tariffs to 15% helps competitiveness against Japan and South Korea, the remaining tax burden remains a challenge due to low profit margins, which US buyers may have to bear.
This agreement follows former President Donald Trump’s accusations that Taiwan had stolen the US chip industry, prompting President Lai Ching-te’s administration to work hard to increase defense budgets and investments in the US to preserve relations and avoid the impact of tariff walls.
In 2024, Taiwan’s trade surplus with the US reached as high as $74 billion, with more than half coming from information and communication technology products, including semiconductors that are central to products ranging from iPhones to Nvidia’s AI hardware.
,AFP