Taiwan Pushes Back on Tariff Deal Reports: ‘No Final Agreement’ Despite $400B US Investment Rumors
Taiwan’s Ministry of Economic Affairs has denied that a tariff agreement with the United States has been reached, following reports that Taipei planned to commit roughly four hundred billion US dollars in American investments in exchange for lower tariffs.
The Financial Times reported earlier that a draft deal suggested Taiwan would match investment levels placed between the three hundred fifty billion US dollars pledged by South Korea and the five hundred fifty billion US dollars agreed by Japan. The report claimed Taiwan was prepared to invest about four hundred billion US dollars to secure a lower reciprocal tariff.
Taiwan says talks are ongoing
Economics Minister Kung Ming hsin told reporters on Friday that no agreement had been finalized with Washington. He said that once any deal is confirmed, Vice Premier Cheng Li chiun, who leads Taiwan’s tariff negotiations, and the Office of Trade Negotiations would make details public.
When asked if an agreement was imminent, Kung said only, “We are working hard on it.”
A United States official cited in the Financial Times said Taiwan’s investments would not be vague commitments, but projects that were already planned or underway.
TSMC investments seen as part of reported commitment
Two individuals familiar with the draft tariff proposal told the Financial Times that investments from Taiwan Semiconductor Manufacturing Co. would be included in the total figure.
TSMC is already investing sixty five billion US dollars to build three advanced semiconductor fabs in Arizona, with the first beginning mass production in late 2024. The company has also pledged an additional one hundred billion US dollars in coming years to build three more fabs, two assembly plants and one research and development center.
Negotiation team still pushing for tariff reductions
Taiwan’s Office of Trade Negotiations said discussions with the United States were continuing through videoconferences and document exchanges. The goal is to reach an agreement that would allow both sides to advance bilateral economic cooperation.
The office said the team is pursuing supply chain partnerships under what it calls the Taiwan model, aimed at reducing the twenty percent tariff imposed on Taiwan during the Trump administration.
Taiwan also seeks most favored nation treatment under Section 232 of the United States Trade Expansion Act. Washington is currently conducting a national security review that may determine tariffs on semiconductor imports and related products.
Check More: Tariff deal with U.S. ‘not finalized’
Officials said Taiwan is working to ensure that any new tariff adjustment does not add to existing most favored nation rates.
How the Taiwan model works
Under the Taiwan model, Taiwanese companies would design their own investment strategies in the United States, building operations closer to American clients to strengthen competitiveness.
The Taiwan government would issue financial guarantees to help domestic investors create industrial clusters in the United States. These companies would also benefit from American government incentives through government to government cooperation.
Officials said this model differs from arrangements negotiated by Japan or South Korea and should not be directly compared with those countries agreements.
