Taiwan signed a new trade deal with the United States, aiming to lower the tariffs US President Donald Trump imposed on the island last year, a move that irked China due to its claim to the island.
Under the new agreement, Taiwan saw tariffs on its goods cut to 15%, the same rate as Japan and the European Union once they signed their trade deal with the US. In addition, Taiwan pledged to invest $250 billion in the US tech industry.
Commenting on the deal, Taiwan Premier Cho Jung-tai said, “For the time being, we obtained the best tariff deal enjoyed by the countries with trade surplus with the US,” adding that the target was to secure lower tariffs. Taiwan had tariffs with the US of 20%, already down from the initial 32% that Trump imposed earlier in 2025. The deal includes no additional fees for the automotive and wood furniture industries, and no tariffs for some components used in the aerospace industry. Taiwan will have to ratify it in its parliament.
The US Department of Commerce also hailed the new deal as a stepping stone towards creating industrial parks in the US to drive manufacturing. In a statement, the department called it “a historic trade deal that will drive a massive reshoring of America’s semiconductor sector.”
China didn’t react well to the news, as Beijing claims the island as a renegade region of the country and actively discourages official ties with Taiwan. A Foreign Ministry spokesperson told reporters during a news briefing that “China always firmly opposes countries having diplomatic relations with China and China’s Taiwan region signing any agreement that carries sovereign connotations and an official nature with China’s Taiwan region.”
