US media reports say tariffs will be cut to 15 percent in exchange for TSMC investment.
Published On 13 Jan 2026
Taiwan and the United States have reached a “general consensus” on a trade pact that would reduce US tariffs on Taiwanese exports, officials in Taipei have said.
Taiwan’s Office of Trade Negotiations said on Tuesday that the outlines of a deal had been reached following months of negotiations with US officials.
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“The goal of the US-Taiwan tariff negotiations has always been to seek reciprocal tariff reductions without stacking tariffs, and to obtain preferential treatment under Section 232,” the office said in a statement, according to the AFP news agency.
The trade office did not immediately respond to Al Jazeera’s request for comment.
US President Donald Trump announced a 32 percent “reciprocal tariff” on Taiwanese exports in April, before lowering the rate to 20 percent in August pending further negotiations.
Countries have made pledges to boost investments in the US in exchange for tariff relief since Trump launched his trade war last year.
Japan and South Korea last year agreed to invest $550bn and $350bn, respectively, to see their tariff rates cut from 25 to 15 percent.
Taiwan’s trade office did not provide details on the deal, but Bloomberg and The New York Times reported that the self-governing island’s tariff rate would be lowered to 15 percent.
As part of the deal, the Taiwan Semiconductor Manufacturing Company (TSMC) would agree to build at least four more production facilities in the US state of Arizona, according to Bloomberg and The New York Times, which cited unnamed officials.
TSMC, the world’s largest chipmaker and supplier to companies such as Nvidia and Apple, said in March that it planned to spend $100bn on new fabrication and packing plants in the US, bringing its total investment in the country to $165bn.
Due to its strategic importance, the chipmaker has been under pressure from Washington since 2020 to expand production outside Taiwan.
The US fears that a blockade of Taiwan by China, which claims the island as its territory, could cut off access to TSMC’s chips.
While TSMC has agreed to build new production facilities in the US, Japan, and Germany, it continues to make its most advanced chips in Taiwan.
