Taiwan Defends Trade Policies Amid U.S. Tariff Threats

Taiwan’s central bank on Wednesday defended the island’s trade and currency policies ahead of potential tariffs from U.S. President Donald Trump, asserting that its high current account surplus is a structural issue recognized by Washington.

Top U.S. officials, including Treasury Secretary Scott Bessent, have indicated that the upcoming reciprocal tariff measures—set to be announced on April 2—will target 15 countries with the highest trade surpluses, a group Bessent has referred to as the “Dirty 15.”

While the U.S. has not officially named these countries, data from the U.S. Census Bureau suggests Taiwan is among them, alongside China, South Korea, and the European Union.

In a report to lawmakers, Taiwan’s central bank highlighted that the island’s current account surplus stood at 14.3% of GDP in the previous year, emphasizing its economic fundamentals in response to potential trade actions.

“It reflects the structural problem of the sharp increase in U.S. demand for Taiwan’s technological products and the expansion of our trade surplus with the United States. The U.S. side understands this point of view,” the central bank said.

Taiwan runs a large trade surplus with the United States, which surged 83% last year, with the island’s exports to the U.S. hitting a record $111.4 billion, driven by demand for high-tech products such as semiconductors, a sector Taiwan dominates.

“As Taiwan’s trade surplus with the United States is relatively large, the risk of bilateral trade disputes between Taiwan and the United States must be carefully managed,” the central bank said.

Taiwan has previously been put on a foreign exchange “monitoring” list by the U.S. Treasury Department given its trade surplus and outsized current account surplus.

The central bank said its exchange rate policy aims to maintain an “orderly” foreign exchange market and financial stability, and that it never intended to gain an unfair competitive advantage in trade.

It also expressed concern about Trump’s frequent economic and trade policy flip-flops and lack of clarity about his plans on tariffs in particular.

“Especially, the impact of the tariff increase policy is the most significant, which is detrimental to the growth of the global economy and may push up inflation,” the central bank said.

REUTERS