US-Taiwan trade talks set to focus on technology supply chains amid global semiconductor shortage

United States and Taiwan are due to convene a meeting of the Taiwan-US Trade and Investment Framework Agreement Council on Wednesday

Washington is expected to discuss ways to strengthen technology supply chains, especially concerning semiconductors, between two economies

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The Taiwan-US Trade and Investment Framework Agreement Council is set to convene on Wednesday. Photo: Stephen Lam

Published: 6:30pm, 28 Jun 2021Updated: 7:31am, 29 Jun 2021

Trade talks on Wednesday between Taiwan and its second-largest export market the United States are expected to lay the foundations for a deal on hi-tech hardware, a cornerstone of Taiwanese exports, rather than focusing on greater trade liberalisation.

The Taiwan-US Trade and Investment Framework Agreement talks are likely to be positive for US interests centered around technology supply chains, while mildly disappointing for Taiwan which is looking for greater market access, according to analysts.

Talks on the trade and investment framework, which is 27 years old, will take place against the backdrop of a global semiconductor shortage that has challenged signature American consumer electronics firms.

Experts said that Taiwan, a net exporter to the US, will be aiming for Washington to drop import tariffs, but US President Joe Biden has said he will not start new trade liberalisation efforts early in his term, which is due to last through 2024.

“Taiwan is hoping [the talks] will lead to a bilateral trade agreement or a free-trade agreement,” said Darson Chiu, deputy macroeconomic forecasting director with the Taiwan Institute of Economic Research. “However, an FTA is not on Biden’s agenda for the time being.”