Credit guarantees for the chip industry
Trade agreement between the USA and Taiwan
After months of negotiations between the USA and Taiwan, there is an agreement. Import duties on Taiwanese products will be reduced. To this end, Taiwan supports investments in the United States.
US President Donald Trump can announce another trade deal: with Taiwan, which is known for its leadership in semiconductor production. Products from Taiwan are to be taxed lower when imported into the USA in the future. In return, Taiwan has promised more investment in the USA.
According to US Secretary of Commerce Howard Lutnick, this also includes the $100 billion investment in the US that the chip manufacturer TSMC had already committed to last year. In addition, Taiwan will guarantee loans worth 250 billion US dollars to facilitate further investments by Taiwanese companies in the USA.
Production in the USA is to be strengthened
The additional investments in the USA will primarily flow into the semiconductor industry and the area of artificial intelligence (AI). The US Department of Commerce said that the agreement would shift a large part of the American semiconductor sector back to the USA.
As part of the agreement, Taiwanese semiconductor and technology companies will invest at least $250 billion in expanding production in the United States. “We hope that we can become close strategic AI partners in the future,” Taiwanese Deputy Prime Minister Cheng Li-chiun said at a news conference in Washington.
Worries despite lower tariffs
Positive for Taiwan: In the future, products imported into the USA will only be subject to an import tariff of 15 percent. There is no duty on general pharmaceuticals and certain raw materials.
In April last year, on the so-called “Liberation Day,” US President Trump initially imposed a general import tariff of 32 percent on products from Taiwan. This was later reduced to 20 percent.
Although the new tariff rate is lower, it still concerns Taiwanese companies. The Taiwanese machine tool manufacturer Litz Hitech Corp. said that when it comes to tariffs, they are now on an equal footing with their main competitors from South Korea and Japan. However, given the company’s single-digit profit margins, it is impossible to absorb the tariffs for US customers.
