Taiwan Allocates $2.7 Billion to Counter US Tariffs

Taipei has announced a $2.7 billion support package to mitigate the economic impact of tariffs imposed by the United States, following an unexpected 32% tax on Taiwanese imports, excluding semiconductors.

The government, calling the tariffs "unreasonable" and "extreme," plans to seek negotiations with Washington to reduce the impact. Premier Cho Jung-tai revealed that the NT$88 billion package is aimed at addressing the needs of Taiwan's industries and society.

Taiwan, which holds the seventh-largest trade surplus with the US, saw a $73.9 billion surplus in 2024. Approximately 60% of Taiwan's exports to the US are in information and communication technology (ICT), including semiconductors.

The assistance package will target the industrial and agricultural sectors, with funds dedicated to financial support, administrative cost reductions, improved competitiveness, tax incentives, and market diversification.

Key industries such as ICT, electronics, steel, metal, machinery, and agricultural exports like tea and orchids are expected to be hardest hit by the tariffs.

Despite the exclusion of semiconductors from the new tariffs, concerns remain that related components could affect Taiwan's dominant semiconductor industry.

The government has emphasized that the tariffs, which include a potential 32% levy, exceed what it deems reasonable or fair.

Vice Premier Cheng Li-chun clarified that the government had prepared for such a scenario, but did not consider the tariffs justified. The Taiwanese government remains determined to seek an exemption for the semiconductor industry and minimize the tariffs' broader economic impact.

Experts warn that the cascading effects of these tariffs could have a significant impact on Taiwan’s role in the global tech supply chain.