Taiwan to cut or scrap tariffs on nearly all US goods, pledge major purchases and investments as supply chain ties deepen
The United States has finalised a reciprocal trade agreement with Taiwan, confirming a 15 per cent tariff on Taiwanese imports while securing sweeping tariff cuts and fresh purchase commitments from Taipei, according to a document released by the US Trade Representative’s office.
Under the deal, Taiwan will eliminate or reduce tariffs on nearly all US goods and significantly increase purchases of American products between 2025 and 2029. The commitments include $44.4 billion worth of liquefied natural gas and crude oil, $15.2 billion of civil aircraft and engines, and $25.2 billion of power grid equipment, generators, and marine and steelmaking machinery—totalling nearly $85 billion over four years.
The agreement builds on a framework reached in January that lowered US tariffs on Taiwanese goods, including semiconductors, to 15 per cent from the 20 per cent initially imposed by President Donald Trump. The new rate places Taiwan on par with key Asian export competitors such as South Korea and Japan.
Taiwan President Lai Ching-te said the deal marks a “pivotal moment” for Taiwan’s economy, adding that it would strengthen high-tech cooperation and build more resilient supply chains between the two sides.
Taiwan also secured exemptions from reciprocal tariffs on more than 2,000 product items exported to the US, bringing the average tariff rate on its exports down to 12.33 per cent, according to Lai. However, the agreement still requires approval from Taiwan’s parliament, where the opposition holds a majority.
The January framework had also included a pledge by Taiwanese firms to invest $250 billion in the United States to expand semiconductor, energy, and artificial intelligence production. Of this, $100 billion has already been committed by Taiwan Semiconductor Manufacturing Co. The Taiwan government has separately said it would guarantee an additional $250 billion in US investments.
While the final text does not elaborate on the investment figures, it states that Taiwan’s representative office in Washington will work with US authorities to facilitate greenfield and brownfield investments in strategic high-technology manufacturing sectors, including AI, semiconductors, and advanced electronics.
The deal will immediately remove Taiwan’s tariffs of up to 26 per cent on several US agricultural imports, such as beef, dairy, and corn. However, some duties—including a 40 per cent tariff on pork belly and 32 per cent on ham—will be reduced to 10 per cent rather than eliminated.
In addition, Taiwan has agreed to ease non-tariff barriers on US motor vehicles and recognise American safety standards for automobiles, medical devices, and pharmaceuticals.
US Trade Representative Jamieson Greer said the agreement would expand export opportunities for American farmers, manufacturers, and workers, while enhancing supply chain resilience, particularly in high-technology sectors.
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