The US reciprocal tariff rate is provisionally set at 20%, but some industries may face higher rates than their competitors, potentially undermining Taiwan’s competitiveness in the US market. Jiann-Chyuan Wang, Vice President of the Chung-Hua Institution for Economic Research (CIER), stated that Taiwan needs to seek alternative markets, with Europe and Southeast Asia being two key focus areas.
Vice President Wang pointed out that as the EU’s Carbon Border Adjustment Mechanism comes into effect, Taiwanese companies that can accelerate their green and digital transformation and further develop R&D partnerships in the Czech Republic, Poland, Lithuania, and Slovenia into manufacturing hubs will benefit from expanding into European and neighboring markets. On the other hand, Southeast Asia has a large population and domestic demand, but Taiwanese companies have historically focused heavily on re-exports, overlooking the potential of local markets. Moving forward, there should be a “private sector-led, policy-supported” approach to establish regional headquarters and logistics centers in Bangkok, Hanoi, or Kuala Lumpur to help manufacturers establish local operations.
Vice President Wang emphasized that global manufacturing patterns are shifting from “concentrated production” to “distributed operations,” and Taiwan’s overseas expansion will also drive the internationalization of the service sector, creating new growth momentum for the Made in Taiwan (MIT) brand.
Author: CIER Editorial Team Date: September 10, 2025