Trump Admin Reaches Trade Deal with Taiwan
The Trump administration has finalized a trade agreement with Taiwan, in which Taiwan will eliminate or lessen 99 percent of its tariff barriers, according to the US Trade Representative's office.
The deal arises as the US continues to depend on Taiwan for its computer chip manufacturing, which accounted for a trade deficit of almost $127 billion in the initial 11 months of 2025, based on Census Bureau data.
Taiwan's shipments to the US will face a 15 percent tax or the US government's "Most Favoured Nation" rate, the USTR's office announced on Thursday. The 15 percent rate is identical to that imposed on other US trading partners in the Asia-Pacific area, including Japan and South Korea.
Trade Representative Jamieson Greer was present for the signing of the mutual agreement, which took place with the support of the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the U.S. Taiwan's Vice Premier Li-chiun Cheng and government minister Jen-ni Yang were also present at the signing.
The agreement arrives before President Donald Trump's scheduled trip to China in April and indicates an intensifying economic connection between the US and Taiwan.
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Taiwan is an independent democracy that China asserts as its territory, to be seized by force if needed. Beijing forbids all nations it has diplomatic relations with, including the US, from establishing official connections with Taipei.
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As part of the agreement, Taiwan will invest $250 billion in US sectors including semiconductor manufacturing, AI technologies, and energy. The government of Taiwan announces it will offer as much as an extra $250 billion in credit assurances to assist smaller enterprises in investing in the US.
The pact would facilitate the sale of automobiles, pharmaceutical products, and food items by the US in Taiwan. However, the essential factor may be that companies from Taiwan would invest in the manufacturing of computer chips in the United States, potentially alleviating the trade disparity.
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The investments contributed to the US lowering its proposed tariffs from a maximum of 32 percent initially to 15 percent.