US Tariffs Threaten Taiwan's Economic Ascent: GDP Growth Faces Significant Headwinds

New Analysis Reveals Potential Economic Fallout for Taiwan Amidst US Tariff Discussions

Taipei, Taiwan - Taiwan's robust economic trajectory is facing a potential setback as the island nation navigates the implications of looming US tariffs. According to preliminary analysis, Taiwan's economic growth could experience a substantial reduction.

National Development Council (NDC) Minister Paul Liu (劉鏡清) revealed the potential impact during a legislative committee meeting. Early assessments suggest that Taiwan's gross domestic product (GDP) growth could decrease by between 0.43 and 1.61 percentage points following the announcement of a 32 percent "reciprocal tariff" by the United States.

Minister Liu emphasized that, as a highly trade-dependent economy, Taiwan is particularly vulnerable to such tariff increases. The NDC has commissioned experts to thoroughly evaluate the potential impact, with a second review currently underway by another research institute.

The Directorate General of Budget, Accounting and Statistics had previously projected a 3.14 percent GDP growth for 2025. However, under the most unfavorable scenario, Liu cautioned that growth could plummet to a mere 1.53 percent.

A Bloomberg report further highlighted the severity of the situation. Model projections suggest that a 32 percent US tariff on Taiwanese exports could slash Taiwan's shipments to the US by approximately 63 percent, potentially resulting in a 3.8 percent GDP contraction.