Taiwan to seek lower tariff after Trump's 'temporary' 20% levy
TAIPEI: Taiwan vowed on Friday (Aug 1) to seek a lower tariff after Donald Trump imposed a "temporary" 20 per cent levy on its shipments as part of his global trade war.
The US president had threatened to hit the island with a 32 per cent tax and possible duties on semiconductor chips.
After four rounds of face-to-face negotiations and multiple video conferences, Taipei and Washington were still trying to strike a deal, Taiwan President Lai Ching-te said on Facebook.
"The US has announced a temporary 20 per cent tariff for Taiwan, with the possibility of further reductions should an agreement be reached," Lai said.
"The government will continue to strive for a reasonable tariff rate and complete the final stages of the tariff negotiations."
Export-dependent Taiwan is a global powerhouse in chip manufacturing, with more than half the world's chips and nearly all of the high-end ones made there.
Soaring demand for AI-related technology has fuelled its trade surplus with the United States - and put it in the crosshairs of Trump's tariff blitz.
Around 60 per cent of Taiwan's exports to the United States are information and communications technology, which includes chips.
To avoid the punitive tariffs, Taipei has pledged to increase investment in the United States, buy more of its energy and increase its own defence spending.
While Washington does not recognise Taiwan as a country, it is the democratic island's most important backer and biggest arms supplier.
Taiwan "will continue to actively negotiate with the United States to reach an agreement and promote Taiwan-US economic and trade cooperation", the cabinet in Taipei said Friday.
Trump in April imposed a 10 per cent tariff on almost all US trading partners, while announcing plans to eventually hike this level for dozens of countries.
But days before the steeper duties were due to take effect on July 9, he pushed the deadline back to August 1.
Taiwan Vice President Hsiao Bi-khim said recently that the government wanted a trade deal with Washington that "will benefit both sides".
"The United States is indeed a very important trade partner for Taiwan," Hsiao said.
Washington also "needs Taiwan in supporting resilient supply chains, in supporting manufacturing and some high-end technologies".
In the weeks leading up to August 1, several economies - the European Union, Britain, Vietnam, Japan, Indonesia, the Philippines and South Korea - struck pacts with Washington, while China managed to temporarily lower tit-for-tat duties. - AFP
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
25 minutes ago
- The Star
Ukraine says it uncovers major drone procurement corruption scheme
A student of the school for drone pilots practices during a lesson, amid Russia's attack on Ukraine, in an undisclosed location, Ukraine, June 30, 2023. REUTERS/Alina Smutko KYIV (Reuters) -Ukraine's anti-corruption bodies said on Saturday they had uncovered a major graft scheme that procured military drones and signal jamming systems at inflated prices, two days after the agencies' independence was restored following major protests. The independence of Ukraine's anti-graft investigators and prosecutors, NABU and SAPO, was reinstated by parliament on Thursday after a move to take it away resulted in the country's biggest demonstrations since Russia's invasion in 2022. In a statement published by both agencies on social media, NABU and SAPO said they had caught a sitting lawmaker, two local officials and an unspecified number of national guard personnel taking bribes. None of them were identified in the statement. "The essence of the scheme was to conclude state contracts with supplier companies at deliberately inflated prices," it said, adding that the offenders had received kickbacks of up to 30% of a contract's cost. Four people had been arrested. "There can only be zero tolerance for corruption, clear teamwork to expose corruption and, as a result, a just sentence," President Volodymyr Zelenskiy wrote on Telegram. Zelenskiy, who has far-reaching wartime presidential powers and still enjoys broad approval among Ukrainians, was forced into a rare political about-face when his attempt to bring NABU and SAPO under the control of his prosecutor-general sparked the first nationwide protests of the war. Zelenskiy subsequently said that he had heard the people's anger, and submitted a bill restoring the agencies' former independence, which was voted through by parliament on Thursday. Ukraine's European allies praised the move, having voiced concerns about the original stripping of the agencies' status. Top European officials had told Zelenskiy that Ukraine was jeopardising its bid for European Union membership by curbing the powers of its anti-graft authorities. "It is important that anti-corruption institutions operate independently, and the law adopted on Thursday guarantees them every opportunity for a real fight against corruption," Zelenskiy wrote on Saturday after meeting the heads of the agencies, who briefed him on the latest investigation. (Reporting by Max Hunder; editing by Mark Heinrich)
The Star
an hour ago
- The Star
From Laos to Brazil, Trump's tariffs leave a lot of losers. But even the winners like Vietnam will pay a price
WASHINGTON (AP): President Donald Trump's tariff onslaught this week left a lot of losers - from small, poor countries like Laos and Algeria to wealthy US trading partners like Canada and Switzerland. They're now facing especially hefty taxes - tariffs - on the products they export to the United States starting Aug. 7. The closest thing to winners may be the countries that caved to Trump's demands - and avoided even more pain. But it's unclear whether anyone will be able to claim victory in the long run - even the United States, the intended beneficiary of Trump's protectionist policies. "In many respects, everybody's a loser here,'' said Barry Appleton, co-director of the Center for International Law at the New York Law School. Barely six months after he returned to the White House, Trump has demolished the old global economic order. Gone is one built on agreed-upon rules. In its place is a system in which Trump himself sets the rules, using America's enormous economic power to punish countries that won't agree to one-sided trade deals and extracting huge concessions from the ones that do. "The biggest winner is Trump,' said Alan Wolff, a former U.S. trade official and deputy director-general at the World Trade Organization. "He bet that he could get other countries to the table on the basis of threats, and he succeeded - dramatically.'' Everything goes back to what Trump calls "Liberation Day'' - April 2 - when the president announced "reciprocal'' taxes of up to 50% on imports from countries with which the United States ran trade deficits and 10% "baseline'' taxes on almost everyone else. He invoked a 1977 law to declare the trade deficit a national emergency that justified his sweeping import taxes. That allowed him to bypass Congress, which traditionally has had authority over taxes, including tariffs - all of which is now being challenged in court. Trump retreated temporarily after his Liberation Day announcement triggered a rout in financial markets and suspended the reciprocal tariffs for 90 days to give countries a chance to negotiate. Eventually, some of them did, caving to Trump's demands to pay what four months ago would have seemed unthinkably high tariffs for the privilege of continuing to sell into the vast American market. The United Kingdom agreed to 10% tariffs on its exports to the United States - up from 1.3% before Trump amped up his trade war with the world. The US demanded concessions even though it had run a trade surplus, not a deficit, with the UK for 19 straight years. The European Union and Japan accepted U.S. tariffs of 15%. Those are much higher than the low single-digit rates they paid last year - but lower than the tariffs he was threatening (30% on the EU and 25% on Japan). Also cutting deals with Trump and agreeing to hefty tariffs were Pakistan, South Korea, Vietnam, Indonesia and the Philippines. Even countries that saw their tariffs lowered from April without reaching a deal are still paying much higher tariffs than before Trump took office. Angola's tariff, for instance, dropped to 15% from 32% in April, but in 2022 it was less than 1.5%. And while Trump administration cut Taiwan's tariff to 20% from 32% in April, the pain will still be felt. "20% from the beginning has not been our goal, we hope that in further negotiations we will get a more beneficial and more reasonable tax rate,' Taiwan's president Lai Ching-te told reporters in Taipei Friday. Trump also agreed to reduce the tariff on the tiny southern African kingdom of Lesotho to 15% from the 50% he'd announced in April, but the damage may already have been done there. Countries that didn't knuckle under - and those that found other ways to incur Trump's wrath - got hit harder. Even some of the poor were not spared. Laos' annual economic output comes to $2,100 per person and Algeria's $5,600 - versus America's $75,000. Nonetheless, Laos got rocked with a 40% tariff and Algeria with a 30% levy. Trump slammed Brazil with a 50% import tax largely because he didn't like the way it was treating former Brazilian President Jair Bolsonaro, who is facing trial for trying to lose his electoral defeat in 2022. Never mind that the U.S. has exported more to Brazil than it's imported every year since 2007. Trump's decision to plaster a 35% tariff on longstanding U.S. ally Canada was partly designed to threaten Ottawa for saying it would recognize a Palestinian state. Trump is a staunch supporter of Israeli Prime Minister Benjamin Netanyahu. Switzerland was clobbered with a 39% import tax - even higher than the 31% Trump originally announced on April 2. "The Swiss probably wish that they had camped in Washington'' to make a deal, said Wolff, now senior fellow at the Peterson Institute for International Economics. "They're clearly not at all happy.'' Fortunes may change if Trump's tariffs are upended in court. Five American businesses and 12 states are suing the president, arguing that his Liberation Day tariffs exceeded his authority under the 1977 law. In May, the U.S. Court of International Trade , a specialized court in New York, agreed and blocked the tariffs, although the government was allowed to continue collecting them while its appeal wend its way through the legal system, and may likely end up at the U.S. Supreme Court. In a hearing Thursday, the judges on the U.S. Court of Appeals for the Federal Circuit sounded skeptical about Trump's justifications for the tariffs. "If (the tariffs) get struck down, then maybe Brazil's a winner and not a loser,'' Appleton said. Trump portrays his tariffs as a tax on foreign countries. But they are actually paid by import companies in the U.S. who try to pass along the cost to their customers via higher prices. True, tariffs can hurt other countries by forcing their exporters to cut prices and sacrifice profits - or risk losing market share in the United States. But economists at Goldman Sachs estimate that overseas exporters have absorbed just one-fifth of the rising costs from tariffs, while Americans and U.S. businesses have picked up the most of the tab. Walmart, Procter & Gamble, Ford, Best Buy, Adidas, Nike, Mattel and Stanley Black & Decker, have all hiked prices due to U.S. tariffs. "This is a consumption tax, so it disproportionately affects those who have lower incomes,'' Appleton said. "Sneakers, knapsacks ... your appliances are going to go up. Your TV and electronics are going to go up. Your video game devices, consoles are going to up because none of those are made in America.'' Trump's trade war has pushed the average U.S. tariff from 2.5% at the start of 2025 to 18.3% now, the highest since 1934, according to the Budget Lab at Yale University. And that will impose a $2,400 cost on the average household, the lab estimates. "The US consumer's a big loser,″ Wolff said. -- AP Economics Writer Christopher Rugaber contributed to this story.
New Straits Times
an hour ago
- New Straits Times
NST Leader: Brazil's COP30 call to action
BRAZIL has a noble reason to host COP30, the United Nations annual climate summit, aka Conference of the Parties: to showcase to the international community that multilateral action is the only way to keep the planet liveable. Earlier in July, when hosting the 17th BRICS summit, Brazil's President Luiz Inacio Lula da Silva put forward his formula: multilateralism, not the law of the strongest, is the only equitable way to solve global problems. He is right at many levels, but let's take climate change. It recognises no boundaries. What gets burned in one country doesn't just stay there; it heats up the rest of the world. The action of a few nations won't work; it must be the collective effort of all. That means multilateralism must trump the law of the strongest. But by hosting COP30, Brazil has taken on three humongous challenges, all the result of failures caused by preceding COPs. First is the failed promise to triple the capacity of renewable energy, a pledge made at COP28 in Dubai. Second is climate finance, which COP29 in Baku, Azerbaijan failed to do much about. Finally, arguably the toughest challenge for Brazil, is to ensure that the 196 countries expected to attend COP30 in the Amazon forest city of Belem put a brake on new investments in fossil fuels so that net zero can be achieved in 2050. Start with the renewable energy pledge made at COP28. Last year, the International Energy Agency (IEA), made media headlines when it warned that its analysis of close to 150 nations' climate action plans led it to conclude that the pledge to triple renewable energy capacity by 2030 will not be met. Meeting the Dubai promise means the world must hit 11,000 gigawatts (GW) by 2030, but IEA's best-case scenario is 8,000GW. The gap may be bridgeable, but worse things have happened since the report was issued, which may widen the gap further. It may not be a bridge too far for Brazil, but to marshal some recalcitrant states would not be easy. Climate finance is equally a mammoth task. It has been an unfulfilled promise for the longest time. According to the 2025 Climate and Catastrophe Insight Report, published by Aon, an insurance company, the world lost US$368 billion to natural disasters last year. The amount is at best an underestimate. Baku, the host of COP29, will be remembered for the wrong thing on climate finance, though it badged itself as a climate finance summit. Instead, it will be remembered for walkouts and protests on climate finance, though a paltry US$300 billion every year for developing countries was eventually agreed. Belem's challenge is to beat Baku to reach US$1.3 trillion that many analysts say is needed. Finally, a giant of a challenge for Brazil: to get the world to do everything needed now to get to net zero by 2050. A tough one for Belem, given that governments around the world are spending trillions of dollars subsidising the fossil fuel industry. What is worse, some countries are putting aside their pledge not to approve any new investments in fossil fuels. This is not the way to slow climate change.
