Trade war: why next US tariffs on China could halve Taiwan’s growth
- Next tariffs, which could take effect in July, include up to 25 per cent on electronic products assembled in China
- Taiwanese firms supply 90 per cent of components for laptop PCs made for the three biggest American PC brands, and assemble most PCs in China
The next round of trade tariffs that the US may impose this summer as part of the escalation of its trade war with China threatens to hurt Taiwan more than other Asian countries because computers and consumer electronics will be targeted for the first time.
The new tariffs, which could be implemented as soon as July, could cut Taiwanese growth this year in half to just over 1 per cent, analysts said.
The tariffs of up to 25 per cent on electronic products assembled in China – including PCs and smartphones – will reduce orders from top brand vendors in the US and so cut demand for products and components from Taiwanese firms in Taiwan and mainland China.
The top three American PC brands depend on Taiwanese firms for 90 per cent of their parts and for assembly on the mainland of the finished product.