US and Taiwan finalize agreement to reduce tariffs and increase US goods purchases

• Taiwan commits to $44.4 billion in LNG and crude oil purchases, $15.2 billion in civil aircraft, and $25.2 billion in power grid and industrial equipment through 2029
• Taiwan will immediately eliminate tariffs of up to 26% on U.S. agricultural products including beef, dairy, and corn
• The 15% U.S. tariff rate reduces Taiwan's initial 20% rate imposed by Trump and matches rates for Asian competitors South Korea and Japan

Summary

The Trump administration and Taiwan finalized a reciprocal trade agreement confirming a 15% U.S. tariff rate on Taiwanese imports, down from the initial 20% imposed by Trump. This positions Taiwan competitively with South Korea and Japan. In exchange, Taiwan commits to eliminating or reducing tariffs on nearly all U.S. goods and significantly increasing American imports.

Key Financial Commitments (2025-2029):

• $44.4 billion in U.S. liquefied natural gas and crude oil
• $25.2 billion in power grid equipment, generators, marine and steelmaking equipment
• $15.2 billion in civil aircraft and engines

Tariff Reductions:

Taiwan will immediately eliminate tariffs up to 26% on U.S. agricultural products, including beef, dairy, and corn.

Sectors Impacted:

• Technology: Taiwan's powerhouse semiconductor industry benefits from reduced tariffs
• Energy: Major LNG and crude oil export opportunity for U.S. producers
• Aerospace: Significant aircraft and engine sales
• Agriculture: Enhanced market access for U.S. farmers and ranchers
• Manufacturing: Power equipment and industrial machinery

Market Implications:

U.S. Trade Representative Jamieson Greer emphasized the deal will boost American export opportunities across multiple sectors while enhancing supply chain resilience in high-technology industries. The agreement strengthens the longstanding U.S.-Taiwan economic relationship and addresses critical semiconductor supply chain concerns. The deal, first reached in January and now finalized with technical details, represents a substantial market opening valued at over $84 billion in committed Taiwanese purchases through 2029.