The administration of Donald Trump has reached a significant trade agreement with Taiwan, aimed at lowering tariffs, expanding market access, and strengthening supply chains in critical sectors such as semiconductors and artificial intelligence.
Under the agreement, Taiwan will remove or sharply reduce nearly 99% of its tariff barriers on American goods. In return, the United States will apply a 15% tariff rate on most Taiwanese exports, bringing it in line with rates offered to key US partners in the Asia-Pacific region. The move marks a shift from earlier proposals that had suggested significantly higher tariff levels.
Officials said the deal is designed to address the large trade imbalance between the two economies. In the first eleven months of 2025, the US recorded a trade deficit of nearly $127 billion with Taiwan, largely driven by imports of advanced semiconductor chips and electronic components.
A central pillar of the agreement is Taiwan’s commitment to invest at least $250 billion in US industries, particularly in semiconductor manufacturing, AI infrastructure, and energy. An additional $250 billion in credit guarantees is expected to support smaller Taiwanese firms expanding into the American market.
Semiconductor giant TSMC is expected to play a leading role in these investments. The company has already pledged around $165 billion toward chip fabrication plants and research facilities in the United States, reinforcing Washington’s push to strengthen domestic chip production.
The agreement also eases regulatory and market barriers in Taiwan for American agricultural goods, automobiles, pharmaceuticals, and medical devices. US officials say this will create new export opportunities for American farmers and manufacturers while making supply chains more resilient.
The deal comes ahead of President Trump’s planned visit to China in April and is widely viewed as a strategic step to deepen economic cooperation with Taiwan amid shifting geopolitical dynamics in the Indo-Pacific region.
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