On July 31 (local time), US President Donald Trump unveiled a new 20% reciprocal tariff on Taiwan. While lower than the previously proposed 32% in early April, the rate remains 5 percentage points higher than those imposed on Japan and South Korea. The Chinese Kuomintang (KMT) condemned the Taiwan authorities for "failing in negotiations."
Economic Impact:
Combined with the 12% loss from the sharp appreciation of the New Taiwan Dollar, the new tariff imposes a 32% cost burden on Taiwanese businesses—a severe blow.
Taiwan's small and medium-sized enterprises (SMEs), already operating on thin profit margins, face diminished competitiveness against Japanese and Korean rivals. Analysts warn this could stall Taiwan's economic momentum entirely.
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