A fishing boat passes alongside a container ship off the Port of Los Angeles in Los Angeles, California, on July 17 (local time). [Getty Images]
A fishing boat passes alongside a container ship off the Port of Los Angeles in Los Angeles, California, on July 17 (local time). [Getty Images]

Even with a sweeping Democratic Party victory in the US midterm elections, the 15 percent tariff rate applied to Taiwanese products is unlikely to change, a Taiwan trade official said.

Chu Ta-sheng, secretary-general of the Confederation of Asia-Pacific Chambers of Commerce and Industry, made the assessment Thursday in comments to Taiwan media including China Times, addressing the potential impact of the Democratic Party's takeover of the US Congress early next year and the expected lame-duck status of President Donald Trump.

The United States and Taiwan signed a trade agreement in February under which Washington reduced its country-specific tariff on Taiwanese goods from 20 percent to 15 percent, while Taiwan agreed to eliminate or ease 99 percent of its tariff barriers.

Chu said it was difficult to judge whether the Democratic victory in the midterms would ultimately benefit or hurt Taiwan's economy, adding that the key factors were the policy choices Trump makes after the elections and whether US economic growth and AI investment can sustain their momentum.

Chu predicted that Trump, having suffered a major defeat, would face significant congressional checks on his agenda — particularly on tax cuts, fiscal spending and the budget — for the roughly two years remaining in his term.

However, Chu said this did not mean the appetite for US protectionism would cool. Trump could instead use tariffs, trade negotiations and pressure on foreign investment to showcase results, potentially expanding such policies further.

Chu identified the greatest external risk to Taiwan's economy next year as the simultaneous slowdown of the US economy and a pullback in AI investment. Should both occur at once, he said, the impact on Taiwan's exports, corporate earnings and stock market would be felt more directly than any question of which party controls Congress. Taiwan should therefore keep a close watch on a deceleration in US economic growth, investment adjustments by major technology companies in AI, and any new economic and trade demands that may emerge from the United States, Chu said.


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