Brian Hioeby Brian Hioe
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Photo Credit: Cho Jung-tai/Facebook
US TARIFFS ARE set to become the latest battleground issue between the KMT and DPP.
In particular, the Lai administration is hoping to tout the reduction of tariff rates to 15% as an accomplishment. The new tariff rate is down from 20% to 15% and does not stack onto current most-favored-nation rates.
Notably, the Lai administration is seeking to credit Vice Premier Cheng Li-chiun with the negotiation. Cheng has been dispatched to the US six times for in-person negotiations with the Trump administration. This time around, no less than Premier Cho Jung-tai went to personally greet Cheng at the airport, highlighting that the Lai administration aims to spotlight Cheng’s contribution to the negotiation.
It is probable that Lai hopes to position Cheng for larger endeavors in the future. In general, while many discuss current vice-president Hsiao Bi-khim as Lai’s likely successor once he completes two terms in office, Lai may prefer Cheng as a more trusted associate. Hsiao is, after all, more closely associated with Lai’s predecessor, Tsai Ing-wen. Tsai herself previously was believed to desire that her first vice president, Chen Chien-jen, would be her successor as president rather than Lai.
In the meantime, the KMT has taken aim at the lowered tariff rates, stating that they should be subject to legislative review. As Taiwanese tech companies will invest 250 billion USD in the US going forward and this was used as leverage in trade negotiations, the KMT likely aims to frame the Lai administration having “hollowed out” Taiwanese industry as part of industries.
The KMT has consistently attacked the idea of TSMC increasing investment in the US, in response to pressure from the Trump administration, including the construction of new semiconductor fabs. The Lai administration has depicted TSMC’s overseas expansion as allowing the company to grow, as well as shore up ties for Taiwan with the US. The KMT has, on the other hand, suggested that the Lai administration has “given away” TSMC to the US for little in return, and that this will lead to the loss of Taiwan’s “Silicon Shield”–the idea that the US and other western powers are invested in Taiwan’s defense because of reliance on Taiwanese semiconductors, as well as China deterred from attacking because of similar alliance.
More generally, in leaning into attacks on the DPP over semiconductors and tariffs, this continues the KMT’s embrace of US-skeptic discourse. The KMT has sought to go on the offensive over any successes by the DPP in strengthening diplomatic ties with the US, instead suggesting that the US simply seeks to sell Taiwan useless arms for profit, and that it does not have any true concern with Taiwan’s defense. The Trump administration’s openness about exploiting countries normally seen as traditional allies of the US has provided much ammunition for US-skeptic views in Taiwan.
It may not be surprising to see the KMT take aim at what the DPP hopes to frame as diplomatic successes on this front, then. Indeed, an announcement of a lowered tariff rate was anticipated to potentially help the DPP’s odds of success before the “Great Recall Movement” last year, involving the effort to recall all KMT legislators.
The KMT’s ally, the TPP, has similarly tried to attack the DPP over tariffs. TPP acting chair Huang Kuo-chang recently traveled to the US for a trip that he claimed would involve discussing tariffs with the US. However, though Huang did meet with members of the office of the US Trade Representative, the tariff deal was announced around the same time, probably undercutting the optics that the TPP would have otherwise aimed for.
In the meantime, one notes that US President Donald Trump intends to visit China in the near future. The DPP is likely to try to cement its tariff negotiations before then, especially given the risk that Taiwan could come up unpredictably in conversations between him and Chinese President Xi Jinping.