U.S.-China Trade War Heats Up: Trump Announces 90-Day Tariff Delay, Causing Volatility in Taiwan and U.S. Stock Markets

Taiwan • Business • 04/11 22:39
U.S.-China Trade War Heats Up: Trump Announces 90-Day Tariff Delay, Causing Volatility in Taiwan and U.S. Stock Markets

On April 9, President Trump of the United States announced a 90-day suspension of high tariffs for most trade partners, imposing only a 10% baseline tariff. However, tariffs on Chinese goods were raised to 145%, escalating tensions in the U.S.-China trade war. This move caused turmoil in global financial markets, leading to significant drops in both U.S. and Taiwanese stock markets. Officials from the Federal Reserve pledged to stabilize the markets, and the House of Representatives passed a budget resolution paving the way for extending tax cuts, which raised concerns about fiscal stability. The Taiwanese government launched an 88 billion NT export support plan to address potential threats.

Key Updates

04/12 03:36

The first round of the Taiwan-US tariff and trade barrier video conference is underway, with a focus on reciprocal tariffs, non-tariff barriers, and export controls.

On April 11, 2025, the trade negotiation teams from Taiwan and the United States held their first virtual meeting to discuss issues such as mutual tariffs, non-tariff barriers, and export controls. Taiwanese President Lai Ching-te highlighted Taiwan's inclusion in the U.S.'s initial negotiation list and proposed starting with "zero tariffs" as a concept. Both parties agreed to begin further consultations in the near future to enhance economic and trade cooperation between Taiwan and the U.S.

04/12 03:36

Trump's tariff policy causes an 11.2% increase in March car sales, experts warn of the risks of panic buying, Wall Street executives express opposition.

At the beginning of April, President Trump initiated a high tariff policy on imported goods, resulting in an 11.2% increase in car sales in March as consumers bought goods in advance to avoid price hikes. Experts warn that this panic buying might put pressure on household finances. Many financial leaders on Wall Street oppose the tariff policy, worrying it could slow down economic growth and trigger market volatility. Under pressure, the Trump administration has postponed the implementation of some tariffs, but the 25% tariff on goods such as cars has already taken effect, putting pressure on consumers and businesses as they face rising costs.

04/12 02:40

US-China Trade War Intensifies: Tesla Stops Selling Imported Models, Sharp Decline in Cargo Ship Bookings Disrupts the Supply Chain

The intensification of the US-China tariff war is impacting the automotive and shipping industries. Tesla in China has stopped accepting new orders for US-manufactured Model S and Model X cars and is only selling existing inventory. Shipping bookings from Chinese ports to the US have sharply decreased, with nearly no ships departing from Shanghai to the US. US ports are congested, leaving thousands of imported cars stranded, and some car manufacturers are delaying shipments to manage tariff uncertainties. This trade conflict is reshaping the operations of global automotive and logistics supply chains.

04/12 02:40

US-China Tariff War Escalates: Trump Slaps 145% Tariffs on Chinese Goods, Taiwanese Manufacturers Face Rush Orders and Pressure to Lower Prices

The US-China trade war is escalating. On April 9, President Trump announced a 145% tariff on Chinese goods and a 90-day suspension of reciprocal tariffs for 75 other countries, imposing only a 10% base tax rate. This move has caused shocks in the global supply chain, with Taiwanese manufacturers receiving a large number of urgent orders but facing pressure to reduce prices. Air freight space is fully booked, and demand for sea freight has surged, keeping logistics providers busy handling the rush. This article analyzes the impact of tariff policies on Taiwanese industries and the global logistics market.

04/12 01:08

US customs system malfunction impacts importers; Navarro urges market confidence as the Trump administration's tariff policy is facing challenges.

On April 11, 2025, the U.S. Customs and Border Protection's customs declaration system malfunctioned, preventing importers from using duty exemption codes, affecting goods from multiple countries and products from China subject to high tariffs. This issue occurred during the period when the Trump administration's new tariff policy was being implemented, exacerbating supply chain disruptions. White House trade advisor Peter Navarro urged investors to enter the market, stating that the tax cut plan and trade agreements would boost a stock market recovery.

04/11 22:39

U.S.-China Trade War Heats Up: Trump Announces 90-Day Tariff Delay, Causing Volatility in Taiwan and U.S. Stock Markets

On April 9, President Trump of the United States announced a 90-day suspension of high tariffs for most trade partners, imposing only a 10% baseline tariff. However, tariffs on Chinese goods were raised to 145%, escalating tensions in the U.S.-China trade war. This move caused turmoil in global financial markets, leading to significant drops in both U.S. and Taiwanese stock markets. Officials from the Federal Reserve pledged to stabilize the markets, and the House of Representatives passed a budget resolution paving the way for extending tax cuts, which raised concerns about fiscal stability. The Taiwanese government launched an 88 billion NT export support plan to address potential threats.

04/11 19:36

2025 U.S. Tariff Surge: Small and Medium-sized Businesses Feeling the Strain, Graduates Confronting Challenges

In April 2025, President Trump of the United States imposed a 145% tariff increase on Chinese goods and maintained a 10% tariff on goods from most trade partners, causing global market fluctuations, a decline in U.S. stock markets, and a spike in gold prices. Import costs for U.S. small and medium-sized businesses rose, intensifying supply chain pressures. However, experts believe a repeat of the 2008 financial crisis is unlikely in the near term. Recent graduates, facing an uncertain job market, demonstrate readiness and adaptability, actively tackling challenges.

04/11 18:08

The 2025 Trump Tariff Policy Initiates a Global Trade War: the Global Economy and Markets Severely Impacted

In April 2025, the global tariff policy of U.S. President Trump triggered a full-scale trade war, significantly impacting the global economy, financial markets, business operations, and consumers' lives. The U.S. and China imposed high tariffs on one another, and the EU, along with other countries, took retaliatory measures, resulting in business shutdowns, stock market volatility, and increased demand for precious metals. This policy reshaped the global economic and trade order and triggered international negotiations and created policy uncertainty.

04/11 16:39

Taiwan Semiconductor Manufacturing Company and Gigabyte Technology expand their operations in the US to counter the US tariff challenges, while Vanguard International Semiconductor Corporation remains focused on the Asian market.

Taiwanese semiconductor and electronics companies are adjusting their global strategies in response to potential high reciprocal duties from the United States. TSMC and Gigabyte have set up plants in the U.S. to strengthen local production; UMC is rumored to be a target for acquisition, attracting attention; Vanguard International Semiconductor has declined to establish a plant in the U.S. and is instead expanding in Singapore. These actions demonstrate the varied strategies of Taiwanese companies in navigating tariff uncertainties.

04/11 16:39

Escalation of the US-China Trade War: Taiwan's Electronics and Semiconductor Industries Benefit from the 145% US Tariff on Chinese Goods, Resulting in a Surge of Urgent Orders

On April 9, 2025, President Trump of the United States announced a 145% tariff on Chinese imports, while postponing high tariffs on other countries for 90 days. This decision caused turmoil in global markets, benefiting Taiwan's electronics and semiconductor sectors as urgent orders from the U.S. surged. The Taiwanese government swiftly responded by starting tariff negotiations with the U.S. and emphasized strengthening regulations to prevent "country of origin" fraud, to ensure the industry's long-term development.

Trump's Tariff Policy U-Turn: 90-Day Suspension and China Excluded

In the early hours of April 9, U.S. time, the Trump administration officially launched a "reciprocal tariffs" policy against multiple countries worldwide, imposing high tariffs ranging from 20% to 46% on goods from 60 countries, including Taiwan, the EU, Japan, and South Korea. However, just 13 hours later, Trump suddenly announced in the afternoon that, given that more than 75 countries had expressed a willingness to negotiate, he decided to suspend the high tariffs for 90 days, during which only a 10% baseline tariff rate would be applied.

China, however, was excluded from the suspension list. Trump accused China of "disrespecting the global market" and announced a 125% tariff on Chinese goods, adding a previous 20% punitive tariff imposed due to the fentanyl issue, bringing the total tariff rate to 145%. The White House later confirmed this figure and emphasized that the measure would take effect immediately.

China quickly retaliated by announcing retaliatory tariffs of up to 125% on U.S. goods and sanctioning 18 U.S. military-industrial companies. A spokesperson for China's Ministry of Foreign Affairs criticized the U.S. actions as "regressive" and stated, "We will not back down."

Global Market Turmoil: Taiwan and U.S. Stock Markets Drop Sharply and Rebound

Trump's policy U-turn caused significant market volatility. U.S. stocks dropped sharply on April 9 and 10, with the Dow Jones Industrial Average losing over $6 trillion in market value over two days. On the 10th, the Dow fell 2.5%, the S&P 500 dropped 3.46%, the Nasdaq plunged 4.31%, and the Philadelphia Semiconductor Index tumbled 7.97%. TSMC's ADR fell 4.8%.

The Taiwan stock market was also affected, opening on the 11th with a drop of over 580 points, briefly falling below 18,500 points, setting a record for the largest single-day fluctuation. However, as the market digested the news of Trump's tariff suspension, coupled with a strong rebound in traditional and shipping stocks, the Taiwan stock market eventually recovered some of its losses. The previous day (10th), the Taiwan stock market had surged by 1,608 points due to the suspension order, setting a record for the largest point and percentage increase.

Federal Reserve Steps In: Inflation Pressure Below Expectations, Will Stabilize Market

In response to market turmoil, U.S. Federal Reserve officials made public statements. Boston Federal Reserve Bank President Collins stated that in the event of market chaos, the Fed will use policy tools to stabilize the financial system. She noted that the current interest rate level will be maintained for some time to achieve a 3% inflation target.

New York Federal Reserve Bank President Williams pointed out that uncertainty in tariff and immigration policies is undermining consumer and business confidence, predicting that U.S. GDP growth will slow to below 1%, and the unemployment rate may rise to 4.5% to 5%. He emphasized that the Fed will closely monitor inflation expectations and maintain policy flexibility.

The latest March U.S. Consumer Price Index (CPI) showed a year-on-year increase of 2.4%, the lowest increase in nearly four years; the core PPI increased by 3.3%, also below expectations. Although short-term inflation data is easing, the University of Michigan Consumer Confidence Index fell to 50.8, the second-lowest in history, indicating continued market concerns about the future.

House Passes Budget Resolution, Tax Cut Bill Enters Substantive Review

Meanwhile, on April 11, the U.S. House of Representatives passed a budget resolution by a vote of 216 to 214, paving the way for extending the "Tax Cuts and Jobs Act" (TCJA) from Trump's term. The resolution will serve as the basis for the budget reconciliation process, allowing Congress to pass tax reform legislation without Democratic support.

According to the House Ways and Means Committee, if the current tax cuts are not extended, a family of four with an annual income of $80,610 will face a tax increase of $1,695. Republicans argue that extending the tax cuts will help stimulate the economy and consolidate voter support.

However, the budget also includes spending cuts of up to $1.5 trillion, which could affect social welfare programs such as Medicaid, raising concerns among some moderate party members. The market is also worried that with high tariffs and tax cuts in parallel, the U.S. fiscal deficit may further expand, affecting the stability of the national debt market.

Taiwan Government Launches NT$88 Billion Export Support Plan

Facing the threat of a 32% U.S. tariff on Taiwan, which is temporarily suspended but still poses a threat, Taiwan's Executive Yuan approved an NT$88 billion "Export Supply Chain Support Plan" proposed by the Ministry of Economic Affairs on April 10. The plan covers four major directions: loan subsidies, industrial upgrades, market diversification, and other measures. President Lai Ching-te emphasized that the 90-day "golden window for negotiations" will be used to strive for the greatest national interest.

Additionally, the Ministry of Finance is considering extending the tax filing deadline, similar to the COVID-19 pandemic period, to alleviate short-term financial pressure on businesses. The Ministry of Economic Affairs stated that 20 industry response measures will continue to be promoted and will flexibly respond to subsequent U.S. policy adjustments.

References

People Also Ask...

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Specifically, how will the Taiwanese government's NT$88 billion export support plan help local businesses?

faq

Trump has imposed a 145% tariff on China. How will this impact the direction of the US-China trade war?

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Why did Trump choose to temporarily delay tariffs on several countries but increase tariffs on China? What's the strategy behind this?