Taiwan has pledged to assist companies planning to relocate their operations to the United States in response to new tariffs imposed by former US President Donald Trump.
The tariffs include a 25% levy on imports from Mexico and most goods from Canada, as well as a 10% duty on Chinese imports. These measures, which took effect on Tuesday, have raised concerns of a broader trade war with potential impacts on global economic growth.
Given the significance of Taiwan’s tech industry, particularly in producing semiconductors and electronic components, the new tariffs pose a challenge. Many Taiwanese firms, including major players like Foxconn and Inventec, have manufacturing facilities in Mexico and China.
In response, Taiwan’s Ministry of Economic Affairs announced a series of measures to assist affected companies. These include providing information on potential US investment locations, local regulations, and partner connections. Additionally, Taiwan’s Industrial Technology Research Institute branches in North America will actively promote research, development, and manufacturing collaborations between Taiwanese and American companies.
The ministry emphasized its commitment to monitoring international trade developments and maintaining communication with businesses to offer “timely support and assistance” to help them develop effective strategies in response to the tariffs.
The announcement came as shares of Taiwanese tech companies with operations in Mexico experienced significant losses. Foxconn, also known as Hon Hai Precision Industry Co., saw its shares drop by 8%, while Inventec and Quanta reported declines of 8.5% and 10%, respectively.
Taiwan’s broader stock market also suffered a 4% decline as financial markets reopened after the week-long Lunar New Year holiday.
The Ministry of Economic Affairs stated that it may organize delegations to attend SelectUSA events, a US government initiative aimed at attracting investment. Taiwanese companies will be encouraged to seek local government support for new investments, creating what the ministry described as a “win-win business model” for both the US and Taiwanese supply chains.
Foxconn and Quanta Computer Inc. had already increased their investments in the US following Trump’s election, securing land in states such as California, Wisconsin, and Texas. Quanta also approved a $230 million capital increase for its US unit.
Taiwan’s investments in Mexico are projected to reach $4 billion by 2025, employing around 70,000 people since 1999. However, with the rising tariffs and shifting global trade dynamics, Taiwanese firms are being forced to reassess their production strategies and investment locations.
