Taiwan to help companies relocate to US following Trump tariffs

TAIPEI - Taiwan will support companies that plan to relocate to the US, including by helping them find partners, the economy ministry said on Feb 3, outlining assistance it will offer after US President Donald Trump’s new tariffs kick in.

Mr Trump’s orders for additional levies of 25 per cent on imports from Mexico and most goods from Canada, as well as 10 per cent on goods from China, were light on details.

But they kick in on Feb 4 and have jolted markets as investors fear a broader trade war could severely hurt global growth.

Taiwan, whose companies are key producers of tech products like semiconductors and electronics parts, is vulnerable, given that many companies have factories in both Mexico and China and because Mr Trump has also threatened future tariffs on imported chips.

Taiwan’s economy ministry, in a statement detailing measures to help companies impacted by the new US tariffs, said it will provide information for firms wanting to relocate, such as possible US states to invest in, local laws and assistance in finding partners.

The government’s Industrial Technology Research Institute branches in North America will also actively promote research and development and manufacturing cooperation between Taiwanese and US companies, it added.

The ministry said it will continue to pay close attention to changes in international trade and maintain communication with companies to provide them with “the most timely support and assistance to ensure that they find the best strategies to cope with the changes”.

Taiwan’s marquee investment in the US is US$65 billion (S$88.8 billion) from chipmaker TSMC to build factories in Arizona, a plan begun in 2020 under Mr Trump’s first administration.

Shares in Taiwanese tech companies with factories in Mexico fell heavily on Feb 3, with Foxconn closing down 8.1 per cent, Quanta down 9.8 per cent and Inventec off 6.7 per cent.

Taiwan’s benchmark index ended down 3.5 per cent. Financial markets in Taiwan reopened on Feb 3 after the week-long Chinese New Year holiday.

Taiwan is also eager to ensure its companies continue moving away from China, which has ramped up military and political threats to assert its sovereignty claims over the island.

Taiwan’s President Lai Ching-te, speaking in Taipei on Feb 3 to Taiwanese companies that have invested in China, said the government will maintain friendly policies to support firms that wish to invest instead in Taiwan. Interest rates will be kept under control to help manage company costs, as will the foreign exchange rate and inflation, he added. REUTERS