The United States and Taiwan have finalized a trade agreement that lowers tariffs on Taiwanese exports to 15%, matching rates applied to Japan and South Korea. The arrangement also increases access for U.S. goods in Taiwan and commits Taipei to substantial U.S. imports in the coming years.
Under the new trade pact, Taiwan will reduce or remove tariffs on 99% of U.S. imports, enabling American industrial and agricultural products—including automobiles, beef, and minerals—to enter the market with preferential treatment.
From 2025 through 2029, Taiwan has agreed to boost purchases of U.S. goods, with commitments totaling $44.4 billion in liquefied natural gas and crude oil, $15.2 billion in civil aircraft and engines, and $25.2 billion in equipment for the power grid, marine, and steelmaking sectors.
The deal builds on a framework negotiated in January, which had already cut tariffs on Taiwanese exports to 15% from the 20% initially set by a previous administration. This tariff reduction positions Taiwan’s exports on equal terms with those from key Asian economies such as South Korea and Japan, especially in sectors like semiconductors.
Additionally, Taiwan will accept U.S.-manufactured vehicles meeting U.S. safety standards without imposing extra requirements, addressing a major non-tariff barrier. According to Taiwan’s President Lai Ching-te, the agreement also grants Taiwan exemptions from reciprocal tariffs on over 2,000 product lines.
The January framework also established that Taiwanese companies would invest $250 billion in U.S. production facilities related to semiconductors, energy, and artificial intelligence, with $100 billion already pledged by Taiwan Semiconductor Manufacturing Corp. Taiwan’s government has guaranteed a further $250 billion in investments in the U.S.
Despite U.S. goals to shift 40% of Taiwan’s semiconductor manufacturing capacity to American soil, Taiwanese officials have called such a move unfeasible. Taipei has communicated concerns about relocating such a significant share of its industry overseas.
The agreement requires ratification by Taiwan’s legislature, where opposition parties hold a majority, before it can be implemented.
