The Trump administration continues to “weaponize tariffs” as a negotiating strategy, not only frequently imposing additional tariffs on the grounds of “unfair trade,” but also incorporating geopolitical considerations by demanding that countries secure tariff reductions through market liberalization, increased investment commitments, or expanded procurement arrangements. The overall negotiating environment reflects a highly asymmetrical power dynamic.
Da-Nien Liu, Director of the Regional Development Study Center at the Chung-Hua Institution for Economic Research (CIER), points out that the U.S. has currently announced reciprocal tariffs for various countries. Although Taiwan’s tariff rate has been reduced from 32% to 20%, the content of related commitments has not yet been disclosed. However, examining the cases of Vietnam, Indonesia, Japan, and South Korea reveals that most have had to exchange comprehensive market liberalization or large-scale investment commitments for tariff reductions, indicating that Taiwan will likely find it difficult to avoid facing similar pressure. If Taiwan seeks to further lower tariff rates or secure exemptions under Section 232, it may need to make additional commitments in semiconductor investments, military, and general procurement.
Director Da-Nien Liu analyzed that Taiwan has already paid a considerable price in tariff concessions and market liberalization, and there is limited room for further concessions. Faced with continuous pressure from the U.S., Taiwan must clearly define its principles for opening its market, hold its bottom line in negotiations, and skillfully use its bargaining chips to mitigate the impact on its industries and economy.
Author: CIER Editorial Team
Date: August 26, 2025