WASHINGTON: Trump administration officials signed a final reciprocal trade agreement that confirmed a 15 per cent US tariff rate for imports from Taiwan, while committing Taiwan to a schedule for eliminating or lowering tariffs on nearly all US goods.
The document released by the US Trade Representative’s office on Thursday also commits Taiwan to significantly boost purchases of US goods from 2025 through 2029, including US$44.4 billion of liquefied natural gas and crude oil, US$15.2 billion of civil aircraft and engines, US$25.2 billion of power grid equipment and generators, marine and steelmaking equipment.
The agreement adds technical language and specific details to a trade framework deal first reached in January that cut tariffs on Taiwanese goods, including from its powerhouse semiconductor industries, to 15 per cent from the 20 per cent initially imposed by Trump. That puts Taiwan on an equal footing with its closest Asian export competitors, South Korea and Japan.
“This is a pivotal moment for Taiwan‘s economy and industries to ride the winds of change and undergo a major transformation,” Taiwan President Lai Ching-te wrote on his Facebook page.
It will optimise the Taiwan-US economic and trade framework, build trustworthy industrial supply chains and establish a Taiwan-US high-tech strategic partnership, he added.
Taiwan also won exemptions from reciprocal tariffs for more than 2,000 product items exported to the United States, meaning the average tariff on US exports will drop to 12.33 per cent, Lai said.
The deal will need approval by Taiwan’s parliament, where the opposition has a majority.
INVESTMENT PLEDGE
The January agreement included a pledge by Taiwan that its companies would invest US$250 billion to boost production of semiconductors, energy and artificial intelligence in the US, including US$100 billion already committed by Taiwan Semiconductor Manufacturing Corp. The Taiwan government would guarantee another US$250 billion in US investments, Commerce Secretary Howard Lutnick said.
The final language did not provide further details on those investments, but said Taiwan‘s representative office in the US would collaborate with US authorities to facilitate additional new greenfield and brownfield investments “in strategic high-technology manufacturing sectors, including AI, semiconductors, and advanced electronics.”
The deal will immediately eliminate Taiwan‘s tariffs of up to 26 per cent on many US agricultural imports, including beef, dairy and corn. But some tariffs, including the current 40 per cent tariff on pork belly and 32 per cent on ham, will only fall to 10 per cent, according to the tariff schedule.
The US said under the deal, Taiwan will remove non-tariff barriers on motor vehicles and accept US auto safety standards as well as those on medical devices and pharmaceuticals.
US Trade Representative Jamieson Greer said in a statement that the agreement will boost export opportunities for US farmers, ranchers, fishermen, workers, and manufacturers.
“This agreement also builds on our longstanding economic and trade relationship with Taiwan and will significantly enhance the resilience of our supply chains, particularly in high-technology sectors,” Greer added.
For the first 11 months of 2025, the US trade deficit with Taiwan ballooned to US$126.9 billion from US$73.7 billion for all of 2024, largely due to the large increase in imports of high-end AI chips from Taiwan, according to US Census Bureau data.