Taiwan-US Trade Talks Aim to Slash Tariffs and Boost Chipmaking Cooperation
Taiwan is eager to boost its trade relations with the US, aiming to reach a consensus on expanding investments and supply chain cooperation through a proposed 'Taiwan model'. The island nation, which currently faces a 20% tariff on its exports to the US, is hopeful that these negotiations will lead to a reduction in these duties.
Leading the talks from Taiwan is Vice Premier Cheng Li-chiun, the top tariff negotiator, who is working closely with US officials to find common ground. One key aspect of the 'Taiwan model' is to extend and expand US production capacity, rather than relocating supply chains. This approach has been welcomed by both sides, with US Secretary of Commerce Howard Lutnick discussing a potential 50-50 split in chip manufacturing.
Taiwan's major chipmaker, TSMC, has shown its commitment to this model by investing US$165 billion in the US, while maintaining most of its production in Taiwan. However, Taiwan has rejected the proposed 50-50 split in chipmaking, preferring instead to focus on 'industrial investment planning' coupled with government support measures.
Taiwan's goal is clear: to cut the 20% tariff on its exports to the US and form a high-tech strategic partnership with the US. With both sides committed to finding a mutually beneficial agreement, the future of Taiwan-US trade relations looks promising.
