US-Taiwan Tariff Talks Reach Critical Point with $88 Billion Support Plan Amid Trump Trade Tensions
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US-Taiwan Tariff Talks Reach Critical Point with $88 Billion Support Plan Amid Trump Trade Tensions
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Today’s update comes as US-Taiwan tariff negotiations reach a pivotal point. In early April, President Donald Trump announced a sweeping 32% tariff on almost all Taiwanese goods entering the United States, with the key exception of semiconductors, Taiwan’s biggest export. The move drew sharp criticism from Taiwanese officials, who labeled it unreasonable but stopped short of retaliation, instead promising to boost imports from the US and eliminate tariffs on American products. President Lai Ching-te emphasized Taiwan’s commitment to dialogue over escalation, underscoring the island’s desire to steady economic ties with Washington.
According to a statement released by Taiwan’s chief tariff negotiator Cheng Li-chiun, these negotiations are now “at a crucial moment—like the final inning of a ball game.” Cheng recently returned from a third round of face-to-face talks in Washington, reporting consensus on several key subjects, though specifics remain undisclosed. A tentative fourth round of talks is already penciled in. With the original 90-day pause on tariff implementation now extended until August 1, the coming weeks will be decisive.
Throughout these talks, Taiwan’s government has taken steps to cushion the impact of US tariffs. Premier Cho Jung-tai unveiled an $88 billion Taiwan dollar support plan—roughly $2.7 billion US dollars—to help industries weather the storm. This package is designed to stabilize the economy, provide sector-specific relief, and fast-track collaboration between executive and legislative branches.
The backdrop to these negotiations is Trump’s broader tariff campaign. In recent months, average applied US tariff rates jumped from 2.5% to 27%, the highest in a century, with rates as high as 50% on steel and aluminum, and blanket increases affecting dozens of countries. While aimed at protecting American industry and narrowing trade deficits, the policy has sent shockwaves through global trade and raised criticism from economists and business leaders alike. Notably, Taiwan’s manufacturing sector could see a 5% drop in production value if the full tariff regime takes hold, according to a National Development Council official.
Despite pressure, Taiwan is holding firm on issues like agricultural imports, declining to open up further to US pork and beef amid public health concerns. Meanwhile, major Taiwanese companies with factories in places like Mexico are watching the August 1 deadline before making major decisions, as new US tariffs threaten to squeeze global supply chains.
Listeners, that’s the situation as the US-Taiwan talks enter a make-or-break phase. We’ll continue tracking every twist as the August deadline approaches.
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