Trump's announcement of high tariffs has led to an escalation in the US-China trade war, causing volatility in global stock markets, resulting in Taiwan's stock market experiencing its largest drop in history.

Taiwan • Business • 04/12 06:39
Trump's announcement of high tariffs has led to an escalation in the US-China trade war, causing volatility in global stock markets, resulting in Taiwan's stock market experiencing its largest drop in history.

In April 2025, President Trump of the United States imposed a 145% tariff on Chinese goods, and China retaliated by raising tariffs on American goods to 125%, escalating the U.S.-China trade war. Global stock markets were severely shaken, with Taiwan's stock market experiencing its largest single-day drop. Trump imposed a 32% tariff on Taiwanese goods, dealing a severe blow to exports, prompting the government to launch an NT$88 billion support plan. The U.S. dollar depreciated amid risk aversion, hitting new lows against the euro, yen, and Swiss franc. Taiwanese companies faced pressure to redirect orders and relocate production.

Key Updates

04/12 10:08

US-China Trade War Escalates: Global Market Capitalization Loses $5 Trillion, Federal Reserve Prepares to Intervene

In April 2025, President Trump of the United States imposed a 145% tariff on Chinese goods, to which China responded with a 125% retaliatory tariff, escalating the U.S.-China trade war. This move triggered global financial market turmoil within 10 trading days, evaporating over $5 trillion in stock market value, and leading to a sell-off in U.S. Treasury bonds and the dollar. Federal Reserve officials indicated they were ready to intervene to stabilize the market, with inflation expectations soaring to their highest since 1981. The dollar index fell below 100, hitting a three-year low, reshaping global capital market confidence and order.

04/12 10:08

China's New Semiconductor Rule: 125% Tariff on U.S.-Manufactured Chips; Texas Instruments and Intel Stocks Fall.

On April 11, 2025, the China Semiconductor Industry Association issued a notice stipulating that the origin of imported chips will be determined by where the wafers are fabricated, impacting the range of the 125% tariff on U.S.-made chips. This policy caused a drop in the stock prices of American companies like Texas Instruments and Intel, with Texas Instruments closing 6.8% lower and Intel 3.7% lower. The new regulation significantly impacts the global semiconductor supply chain and trade dynamics.

04/12 07:37

Trump's equal tariff policy may cause the iPhone 16 Pro price to soar to NT$80,000, and experts warn that the risk of a U.S. economic recession has risen to 45%.

President Trump's "reciprocal tariffs" policy imposes a 145% tariff on imports from China, which could lead to the price of the Apple iPhone 16 Pro skyrocketing to NT$80,000. This policy has already had an impact on global supply chains and consumer markets, leading financial institutions like JPMorgan to warn about the risk of a U.S. economic recession, estimating a 45% probability. This article examines the policy's impact and expert opinions, highlighting the potential effects of tariffs on the U.S. economy and the prices of consumer electronics.

04/12 07:37

US-China Chip Tariff Dispute Escalates: Imposition of High Tariffs by 2025 Causes Global Market Turmoil and Price Hikes

In April 2025, President Trump of the United States imposed a 145% tariff on chips imported from China, and China countered with a 125% tariff on chips from the United States, leading to upheaval in the global semiconductor market. The prices of Chinese chips skyrocketed, resulting in a wave of panic buying, and many distributors halted price quotations. China's new regulation regards the wafer fabrication site as the place of origin, affecting U.S. manufacturers such as Intel and forcing companies to reevaluate their supply chain arrangements.

04/12 06:39

Escalation in the US-China Trade War: US Imposes 145% Tariff on Chinese Goods, China Retaliates with a 125% Tariff, Global Markets in Turmoil

On April 12, 2025, the US-China trade war intensified, with the US imposing a total tariff rate of 145% on Chinese products, and China retaliating with a 125% rate. This led to disruptions in global supply chains and financial markets. Taiwanese manufacturers experienced a surge in orders, air freight space was fully booked, and the Taiwan stock market experienced significant volatility. The US temporarily suspended reciprocal tariffs for 90 days on 75 countries, with Taiwan included in the first round of negotiations, requiring only a 10% tariff rate, prompting Taiwanese electronics and semiconductor companies to speed up shipments.

04/12 06:39

Trump's announcement of high tariffs has led to an escalation in the US-China trade war, causing volatility in global stock markets, resulting in Taiwan's stock market experiencing its largest drop in history.

In April 2025, President Trump of the United States imposed a 145% tariff on Chinese goods, and China retaliated by raising tariffs on American goods to 125%, escalating the U.S.-China trade war. Global stock markets were severely shaken, with Taiwan's stock market experiencing its largest single-day drop. Trump imposed a 32% tariff on Taiwanese goods, dealing a severe blow to exports, prompting the government to launch an NT$88 billion support plan. The U.S. dollar depreciated amid risk aversion, hitting new lows against the euro, yen, and Swiss franc. Taiwanese companies faced pressure to redirect orders and relocate production.

04/12 06:07

In 2025, the US-China tariff war heats up: India could be the winner, Taiwanese stocks soar, and Taiwanese businesses in Vietnam are under pressure.

In April 2025, the US-China trade war intensified as President Trump imposed a 145% tariff on Chinese goods, and China retaliated by raising its tariffs to 125%. This move caused global market turmoil and led to a conservative outlook for the US economy. Expectations for a Federal Reserve rate cut increased, which benefited long-term bonds. China initiated a plan to shift exports to domestic sales, and Taiwan's stock market rebounded thanks to the intervention of the National Stabilization Fund and favorable trade negotiations. Taiwanese businesses in Vietnam faced pressure from a 46% tariff and actively engaged in negotiations to adjust their strategies. India, with its low export dependency and flexible policies, was considered a potential beneficiary.

04/12 05:08

President Trump of the United States delays reciprocal tariffs by 90 days: begins trade talks with Taiwan and 15 other countries, with the goal of reaching 90 agreements.

On April 9, 2025, President Trump of the United States announced a 90-day pause on high reciprocal tariffs for most trade partners, excluding China, imposing only a 10% standard tariff rate. This decision was made in response to the willingness of 75 countries to negotiate. The Trump administration aims to finalize 90 trade agreements during this period, with Taiwan being part of the first round of negotiations, and a video conference with the United States set for April 11. Even though China is not on the suspension list, Trump remains optimistic about negotiating an agreement with China.

04/12 05:08

Experts: U.S. tariff policies may result in iPhones being made in the U.S., with prices possibly soaring to NT$80,000.

On April 12, 2025, the 145% reciprocal tariff policy promoted by President Trump of the United States posed a significant challenge to Apple Inc. Oliver, an economist at AMP in Australia, pointed out that if Apple moves its iPhone production line back to the U.S., the price could skyrocket to $2,519. This policy pressures Apple to restructure its supply chain and could potentially cut its annual profit by $40 billion. Economists warn that the risk of a U.S. recession has increased to 45%. Apple is taking steps to address this, such as expanding production in India and offering installment plans.

04/12 04:38

First Round of Taiwan-US Tariff Negotiations Begins: Taiwan as the Initial Focus, Focusing on Economic and Trade Barriers and Export Controls

On April 11, 2025, Taiwan and the United States commenced the first round of tariff negotiations via video conference, discussing issues such as reciprocal tariffs, non-tariff trade barriers, and export controls. The Taiwanese team was led by Executive Yuan Deputy Premier Cheng Li-chun (Lily Cheng) and Chief Negotiator Jenny Yang. Taiwan, along with Israel, was included in the first wave of negotiations by the U.S., indicating the U.S.'s acknowledgment of Taiwan's strategic importance. Both parties will continue negotiations during the 90-day tariff suspension period, with the aim of establishing a strong economic and trade relationship between Taiwan and the U.S.

US-China Tariff Standoff Escalates, Trade Nearly Disrupted

On April 9th, 2025, US President Trump announced an "equivalent tariff" on Chinese goods at a rate of 125%, adding to the previous 20% tariff on fentanyl-related products, bringing the total tariff rate to 145%. In retaliation, China's State Council announced on April 11th that it would raise tariffs on US goods from 84% to 125%. UBS analysis indicates this is equivalent to a near-total disruption in trade between the two countries, with the 2024 bilateral trade volume of $650 billion at risk of collapse.

Global Stock Markets in Turmoil, Taiwan Stocks Hit Record

Trump's tariff policy triggered significant volatility in global stock markets. The Dow Jones Industrial Average plummeted 4,000 points within 48 hours, marking the first time in history it fell more than 1,500 points on consecutive days. The S&P 500 and Nasdaq indices fell by 5.97% and 5.8%, respectively, with Nasdaq entering bear market territory.

Asian markets were similarly hit hard. Japan's Nikkei 225 index plunged 7% in a single day, the largest drop since 2020, while South Korea's KOSPI index fell over 5%. The European STOXX 600 index fell 1.7% this week, marking one of the most turbulent weeks in recent years.

Taiwan's stock market experienced historic fluctuations. On April 7th, Taiwan stocks plummeted 2,065.87 points in a single day, a 9.7% drop, setting records for the largest single-day point and percentage drop, with a market value evaporation of NT$6.6 trillion. On April 10th, Trump's announcement of a 90-day suspension of high tariffs on most countries spurred a strong rebound of 1,608.27 points in Taiwan stocks, the largest single-day point gain in history. After another 1,000-point fluctuation on April 11th, it closed up 528.74 points, but the weekly index still fell by 1,769.45 points.

Taiwan's Export Plans Hit, Government Launches NT$88 Billion Support Plan

Trump's imposition of a 32% equivalent tariff on Taiwan has dealt a significant blow to Taiwan's export-oriented economy. According to estimates by Taiwan's Executive Yuan, Taiwan's exports to the US will decrease by 26%, affecting 5% of manufacturing output and impacting 125,000 jobs. Affected industries include electronics, machinery, transportation equipment, steel, and home appliances, with output impact ranging from 3% to 14%.

Among Taiwan's exports to the US, information and communication technology products account for 52%, electronic components 13.4%, and high-tech products such as servers and graphics cards are particularly hard hit. The 32% tariff imposed by the US on Taiwan is much higher than that on Japan (24%) and South Korea (25%), causing Taiwanese products to lose price competitiveness in the US market.

In response to the impact, Taiwan's Executive Yuan proposed a support plan totaling NT$88 billion, with NT$70 billion for the industrial sector and NT$18 billion for the agricultural sector, led by Vice Premier Cheng Li-chun to engage in trade negotiations with the US.

US Dollar Depreciates, Safe-Haven Assets Surge

As concerns over the escalation of the US-China trade war intensified, the US Dollar Index (DXY) dropped below the 100 threshold, hitting a new low since July 2023, with a single-day drop of 1.2%. The US dollar fell to 0.81405 against the Swiss franc, the lowest since 2015; to 142.88 against the yen, a six-month low; and depreciated to 1.1424 against the euro, the lowest in three years.

The offshore yuan once depreciated to a historic low, but the People's Bank of China continuously raised the central exchange rate, rebounding to 7.3232 on Friday, indicating the Chinese central bank's intention to control the pace of yuan depreciation.

In terms of safe-haven assets, gold prices surged to $3,200 per ounce, a record high. Brent crude oil futures were priced at $63.97 per barrel, up 1% in a single day, but still facing pressure for a second consecutive weekly decline.

Taiwanese Export Companies Face Pressure to Shift Orders and Production

Facing high tariff pressure, some Taiwanese export companies are considering relocating production bases to Southeast Asia or other regions to maintain competitiveness in US exports. For example, the Vietnamese government has begun negotiations with the US to crack down on Chinese companies using Vietnam for re-export to evade taxes and to strengthen control over sensitive technology exports.

Additionally, the American Chamber of Commerce in Taiwan issued a statement urging the US not to implement trade measures that endanger bilateral relations and supporting the Taiwanese government's efforts to seek tariff reductions and enhance market access.

References

People Also Ask...

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How exactly will the Taiwan government's NT$88 billion support package assist the industries that have been affected?

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Trump has imposed a 32% tariff on Taiwan; how will this affect Taiwan's exports?