Taiwan – US security partner but silent victim in Donald Trump’s trade war

Numerous Asian economies linked to China’s fortunes are caught in the crossfire of the US-China trade war. But none might feel as voiceless as Taiwan.

The self-ruled island’s heavy dependence on the mainland economy has exposed it to the twists and turns of the tit-for-tat trade battle launched by US President Donald Trump months ago. But as a steel producer, it also is feeling the impact of Washington’s global steel and aluminium tariffs, which target China’s excess capacity in its steel sector, in particular.

Despite being a close military and security partner of the United States by law, Taiwan has limited diplomatic relations with Washington, mindful that any such exchange would anger Beijing, which considers the self-ruled island a breakaway province to be brought into line by force, if necessary.

A 24-year-old goods and services trade deal that is Taiwan’s only framework for an economic dialogue with the US was suspended last year amid problems filling vacancies for officials to administer the deal at the United States Trade Representative’s office as the trade war escalated.

Chern-Chyi Chen, deputy representative of economic affairs at Taiwan’s de facto embassy in Washington, said this week that Taiwan’s steel sales to the US had dropped 12 per cent since Trump gave the order in March for a 25 per cent tariff on imported steel and a 10 per cent tariff on aluminium, citing national security concerns.

“Taiwan is not exempted from the tariffs … we hope this will come to an end quickly,” the official said at an event presented by the Heritage Foundation, a Washington-based think tank.