Taiwan has announced that the United States has no immediate plans to impose Section 232 tariffs on semiconductors, although preferential terms have already been established under a trade agreement reached in January. Taiwan’s Vice Premier Cheng Li-chiun confirmed this development on Thursday, highlighting the benefits secured for Taiwanese businesses.

Trade Agreement Details

As part of the bilateral trade deal, the US has agreed to remove or reduce tariffs on certain Taiwanese imports, including auto and aircraft parts, wood, and steel. These changes, effective retroactively from May 1, will be officially published in the Federal Register. The agreement also grants Taiwan most-favored-nation treatment for semiconductors, ensuring that any future tariffs under Section 232 will include corresponding preferential treatment for Taiwanese companies investing in the US.

Impact on Semiconductor Industry

Taiwan is a significant player in the global semiconductor market, home to TSMC, the world’s largest contract chipmaker. TSMC is currently investing $165 billion to construct factories in Arizona, a move that underscores the strategic importance of the US-Taiwan trade relationship. Vice Premier Cheng emphasized that the pre-secured preferential treatments will remain unchanged, providing stability for Taiwanese businesses amidst potential tariff discussions.

The US has indicated the possibility of imposing Section 232 tariffs on semiconductors as part of a national security investigation into key imports. However, the current agreement ensures that Taiwanese semiconductor producers will receive favorable terms, reflecting the strong economic ties between the two nations.

Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.