Tag: Trade

Taiwan’s Trade Dynamics in 2023: Challenges and Partners Shifting 

Written by Yun-Chieh Wang. In 2023, Taiwan’s international trade experienced a decline in growth because of global economic challenges, with a notable dependency on semiconductor exports. Despite this downturn, Taiwan’s trade gap widened positively, attributed to the reshoring of Taiwanese enterprises, and increasing foreign investment. Meanwhile, the Taiwanese government is actively diversifying its trade partners, reducing its reliance on China and forging ties with the U.S. and U.K. through trade agreements.

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US-Taiwan Trade Agreement: It is More of Politics than Economic

Written by Raian Hossain. Taiwan has severe military security concerns, and the island has over-trade and investment dependency towards the PRC, which raises the question of economic security. As of 2022, the PRC accounted for 25% of Taiwan’s exports and 20% of its imports, making Beijing still the largest trading partner of Taipei. However, Taiwan made significant progress in growing trade by 25% with the U.S. in 2021 and expanded its trade volume with New South Bound countries under President Tsai Ing-wen. After a year of negotiations aimed at diversifying trade and commerce, the U.S. and Taiwan signed the first part of the US-Taiwan Initiative on 21st Century Trade. Meanwhile, the second round of negotiations has already started.

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Taiwan-US Trade Initiative: A good start, but the beginning of a long road

Written by Chieh-Ting Yeh. In 2005, I understood the FTA to be an aspirational long-shot—something that we can press for but not something we should expect to see in the foreseeable future. Recent developments such as the 21st Century Trade Initiative are milestones for sure, but milestones to mark just the beginning of a long road for a true free trade agreement with the US, as well as meaningful participation in regional trade blocs.

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The Prospect of a US-Taiwan BTA in an Era of Heightened Political Exchanges

Written by Brian Hioe. The US and Taiwan signed the first stage of the US-Taiwan Initiative on 21st Century Trade in June, paving the path for both to streamline customs and taxation procedures between both sides. The trade agreement will also boost economic cooperation regarding small-to-medium-sized enterprises, while implementing anti-corruption measures. Progress on the trade agreement has continued, with the second negotiating round of the agreement starting in August. In particular, an end to double taxation between the US and Taiwan is a concrete outcome that both sides may pursue, long a stumbling block for those that work and do business in both the US and Taiwan. As progress on the US-Taiwan Initiative on 21st Century Trade has continued, legislation to this effect has been introduced in the US Senate.

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Truss or Sunak? Who is better for Taiwan?

Written by Ben Seal. In the previous general election, which took place in December 2019, just over forty million voters gave Boris Johnson a majority of eighty seats. This summer, after the resignation of Johnson, around 180,000 Conservative Party members are choosing who will be the UK’s next Prime Minister. Will they select Sunak or Truss? As the voting goes into the final days, polls suggest that Truss will be the most likely victor, but my piece attempts to examine how both contenders would affect the UK’s relationship with Taiwan.

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Tension Across the Taiwan Strait: Perspectives, Concerns & Dynamics from South Asia

Written by Raian Hossain. This article looks into the reactions and concerns from Asian countries due to the complex triangular relationship of the US-China-Taiwan in the Taiwan Strait. While analysing the dynamics, it also unpacks whether this ongoing crisis would further shrink Taiwan’s space for engagements in the international space like trade, commerce, and people-to-people connectivity (not focused on diplomatic recognition). Therefore, this article takes the South Asian region as a case study to answer these two queries.

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Taiwan’s Catalytic Role for Resilient Development in the CPTPP

Written by Peter C. Y. Chow. The Comprehensive and Progressive Agreement for Transpacific Partnership (CPTPP) was considered as one of the pathways to a Free Trade Area of Asia Pacific (FTAAP) during the APEC meeting in 2014. Hence, membership enlargement in this trade bloc will enhance its sphere of regional influence, leading toward the path of free trade in the Asia Pacific. CPTPP is the highest standard of trade accord which includes what is not in the WTO-the WTO extra and those beyond the WTO- the WTO plus. Therefore, it symbolises a gold standard of trade liberalisation in the 21st century.

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How Vital is the CPTPP Membership to Taiwan?

Written by Yun-Chieh Wang. On September 22, 2021, six days after the Chinese government submitted its application to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Taiwanese government handed in its application to the depository in New Zealand. According to World Trade Organisation (WTO) data, Taiwan ranks as the top 15 goods export and the top 18 goods import economy in 2020. However, Taiwan has only signed a few trade agreements with its trading partners and cannot join critical regional trade agreements such as Regional Comprehensive Economic Partnership (RCEP). Therefore, participating in CPTPP is expected to promote Taiwan’s trade ties with the trade partners effectively.

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A Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP): A Game of Go? Or Three-dimensional Chess?

Written by Chun-Yi Lee and Michael Reilly. The CPTPP is an ambitious, wide-ranging free trade agreement (FTA) signed between Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore, and Vietnam in March 2018. The CPTPP was originally named as the Trans-Pacific Partnership and comprised twelve members. However, after the Trump administration withdrew the USA from it in 2017, the remaining eleven countries reorganised and renamed it. After leaving the EU, the UK applied to join in February 2021, followed by China and Taiwan in September. South Korea has been considering joining but has yet to do so. Countries seeking to join the bloc must negotiate tariffs and other market access conditions with each of the eleven original members. 

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Semiconductor Competition: Opportunities for Taiwan

Written by Adhiraaj Anand. The Biden administration has put aside billions of dollars to improve semiconductor manufacturing capabilities in the US, whose global output fell from 37% in 1990 to 12% in 2020. Additionally, the EU Chips Act, proposed in 2022, seeks to make Europe a leader in semiconductor technology and maintain a secure supply of chips by increasing the continent’s market share in the semiconductor industry to 20% by 2030. Japan has similarly unveiled a strategy to promote indigenous semiconductor manufacturing to achieve a 40% global market share in next-generation power semiconductors, which are to be used in emerging technologies such as electric vehicles, by the end of the decade.

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Taiwan’s Economy: GDP Growth is a Bright Spot for Now

Written by John F. Copper. The recent economic news emanating from Taiwan is the impressive growth in its gross domestic product (GDP)—one of the basic indicators of economic vitality. This is certainly good to hear. After experiencing negative growth throughout most of 2020, conditions changed in the last quarter of the year. As a result, Taiwan even bested China’s GDP growth. Furthermore, the upward trend accelerated this year, with GDP expansion the highest in two decades. If this growth is sustained, 2021 will end with a welcomed 5 per cent or better rise.

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The Future of Taiwanese industries’ Supply Chain Reallocations Under Covid-19

Written by Chun-Chien Kuo. By adding fire to the existing US-China Trade War, Covid-19 has accelerated the current economic adjustment pace, along with the need for supply chain reallocation in industries. Thus, industries and firms in Taiwan have responded to adjust their production of diverse parts and components. They have also attempted to establish their own sufficient domestic supply chains. New trends in supply chain reallocation have also emerged, such as localised supply chains, shorten supply chains and digitalisation under the Covid-19 threat.

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