Economy|International TradeUS and Taiwan sign ‘pivotal’ deal to cut tariffsTaipei agrees to buy some $85bn of US energy, aircraft and equipment in exchange for 15 percent tariff rate.
## Trade Agreement Between the United States and Taiwan
Trade Agreement Between the United States and Taiwan
The United States and Taiwan have finalized a trade agreement to reduce tariffs on Taiwanese exports and facilitate the purchasing of U.S. goods. The agreement, announced on Thursday, lowers the general tariff on Taiwanese goods from 20 percent to 15 percent. In exchange, Taiwan has agreed to procure approximately $85 billion in U.S. energy, aircraft, and equipment.
Under the terms of the agreement, Taiwan will eliminate or reduce 99 percent of tariff barriers, providing preferential market access to various U.S. products. These include auto parts, chemicals, machinery, health products, dairy products, and pork. Concurrently, the U.S. will exempt a broad array of Taiwanese goods from tariffs, including chalk, castor oil, pineapples, and ginseng.
According to the U.S. trade envoy's office, the average tariff rate on Taiwanese goods will be adjusted to 12.3 percent, taking into account various carve-outs. The agreement is expected to enhance the price competitiveness of Taiwanese products in the U.S. market.
The United States and Taiwan have finalized a trade agreement to reduce tariffs on Taiwanese exports and facilitate the purchasing of U.S.
Despite the comprehensive nature of the agreement, it does not include specific commitments from Taiwan regarding investment in the U.S. chip industry. This is noteworthy given previous announcements of significant investment commitments by Taiwanese firms in the sector.
While the agreement does not directly address Taiwan’s semiconductor industry, a crucial component of its economy, the U.S. Trade Representative noted that the agreement would enhance the resilience of supply chains, particularly in high-technology sectors.
U.S. Trade Representative Jamieson Greer emphasized that the agreement builds on longstanding trade relations between Taiwan and the U.S., enhancing economic and national security interests. In 2025, nearly one-third of Taiwan's exports were destined for the U.S., marking the country as Taiwan's largest market for the first time since 2000.
Based on reporting by Al Jazeera.