Lai Cheng-i, Honorary Chairman of the Taiwan General Chamber of Commerce: How the Tariff War Affects Taiwan's Real Estate Market and Creates New Opportunities for Cross-Strait Industrial Cooperation

Taiwan • Business • 04/20 07:06
Lai Cheng-i, Honorary Chairman of the Taiwan General Chamber of Commerce: How the Tariff War Affects Taiwan's Real Estate Market and Creates New Opportunities for Cross-Strait Industrial Cooperation

Lai Cheng-yi, Honorary Chairman of the Taiwan General Chamber of Commerce, stated at the "Cross-Strait Grassroots Livelihood Development Forum" that the US-China trade war and the US's high tariff policy towards Taiwan will affect Taiwan's consumer structure and domestic demand market within one to two years, but housing prices are not likely to drop in the short term. Lai is optimistic about a recovery in China's real estate market and suggests that Taiwanese businesses boost domestic sales and enhance digital marketing, and foster cross-strait high-tech manufacturing collaboration to meet the demands of global supply chain restructuring and industry upgrades.

Key Updates

04/20 20:55

Three experts warn that the U.S.'s high tariff policy could pose a risk of economic recession.

U.S. President Trump's push for a new round of high tariffs has caused market turmoil and an uncertain economic outlook. Experts Robert Kiyosaki, Lael Brainard, and Jamie Dimon warn about the risk of a recession. Kiyosaki predicts a financial collapse and recommends investing in assets such as Bitcoin; Brainard criticizes the tariff policy for raising household costs; Dimon highlights a collapse in business confidence. The Atlanta Federal Reserve forecasts a 2.2% GDP contraction in the first quarter of 2025, showing signs of a recession. Federal Reserve Chair Powell warns of inflation risks, while Trump calls for interest rate cuts.

04/20 16:36

The United States levies port fees on ships made in China, which benefits Taiwanese shipping companies because they have a low percentage of ships made in China.

On April 17, 2025, U.S. President Donald Trump signed an executive order announcing the imposition of significant port fees on ships manufactured in China or owned and operated by companies based in China. The order aims to weaken China's stronghold in the global shipping and shipbuilding industries and to revitalize the U.S. shipbuilding industry. The port fees will be rolled out in phases starting October 14, 2025. Taiwanese shipping companies Evergreen, Yang Ming, and Wan Hai are expected to benefit from this policy because they use fewer Chinese-built ships.

04/20 15:05

Decline in Hong Kong's Exports Affects the 2025 Economic Growth Target: Companies Seek New Markets Amid the US-China Trade War

Amid US-China trade tensions, Hong Kong's export volume has declined, affecting the 2% economic growth target for 2025. Leung Siu Kee, a senior advisor at Hang Seng Bank, pointed out that SMEs are facing financial strain due to the disruption of US orders. Experts recommend that businesses explore new markets, and the government and business sector should provide support. Wong Ka Wo, Vice President of the Chinese Manufacturers' Association, stated that policy uncertainty is adding pressure on businesses, especially during the Christmas shopping season. Financial Secretary Paul Chan stressed the importance of maintaining Hong Kong's status as a free port to attract international capital.

04/20 14:37

International grocery stores in the U.S. face import tariffs and supply chain challenges: Small retailers are feeling overwhelmed

In April 2025, international grocery stores in the United States faced challenges due to the import tariff policy implemented by the Trump administration, imposing a 10% tariff on all imported goods and up to 145% on Chinese products. These small, family-run stores that rely on imports are under pressure from rising costs, unstable supply, and losing customers. Business owners from Maryland to Iowa generally feel anxious and are trying to adjust their business strategies to meet these challenges.

04/20 12:36

The United States has imposed tariffs on Chinese goods, causing a surge in the prices of baby products and sparking consumer concerns.

In April 2025, the U.S. government announced a new round of tariff increases on imported goods, specifically imposing a 145% tariff on Chinese goods, causing prices of childcare items such as strollers and car seats to surge. With insufficient domestic manufacturing capacity, the supply shortage worsened. Consumers and retailers faced increased cost pressures, with some brands opting to absorb some of the tariff costs. Medical institutions were also impacted by their reliance on imports, heightening the supply chain's vulnerability.

04/20 07:06

Lai Cheng-i, Honorary Chairman of the Taiwan General Chamber of Commerce: How the Tariff War Affects Taiwan's Real Estate Market and Creates New Opportunities for Cross-Strait Industrial Cooperation

Lai Cheng-yi, Honorary Chairman of the Taiwan General Chamber of Commerce, stated at the "Cross-Strait Grassroots Livelihood Development Forum" that the US-China trade war and the US's high tariff policy towards Taiwan will affect Taiwan's consumer structure and domestic demand market within one to two years, but housing prices are not likely to drop in the short term. Lai is optimistic about a recovery in China's real estate market and suggests that Taiwanese businesses boost domestic sales and enhance digital marketing, and foster cross-strait high-tech manufacturing collaboration to meet the demands of global supply chain restructuring and industry upgrades.

04/20 02:37

Nearly a thousand economists have jointly criticized Trump's tariff policies, warning that it could lead to an economic recession.

In April 2025, nearly a thousand economists jointly published an open letter criticizing President Trump's tariff policy, stating that the calculation method is flawed and lacks an economic theoretical basis, potentially leading to an economic recession. Signatories include Nobel Prize winners in economics, James Heckman and Vernon Smith, and former senior government economic advisors. This statement has drawn both domestic and international attention to U.S. trade policy, pointing out the political motivations behind the policy and its impact on global markets.

04/19 22:04

Taiwan's industrial computer manufacturers respond to U.S. tariffs: Price hikes and plans to set up U.S. factories are advancing in tandem

The Taiwanese industrial computer industry is responding to the U.S. reciprocal tariff policy, with large companies like Advantech, Avalue Technology, and ADLINK negotiating price increases with clients, while medium and small-sized companies like Axiomtek and Vecow are setting price hikes of 5% to 10%. Avalue Technology plans to move its factory setup from Mexico to Tennessee, USA, with production expected to start in the third quarter of 2025. Advantech is considering setting up PCB assembly capabilities in the U.S. Medium and small-sized companies like Axiomtek and Vecow have completed their manufacturing setups in North America, showcasing their flexibility and adaptability.

04/19 18:06

Trump's Tariff Policies Spark Volatility in the U.S. Treasury Bond Market: Rising Yields and a Shift in Safe-Haven Investments

On April 2, 2025, President Trump of the United States announced a 10% basic tax rate on all imported goods and imposed additional tariffs of up to 54% on China and 20% on the European Union, leading to global market turmoil. The yield on the 10-year U.S. Treasury bond rose from 3.9% to 4.5%, then fell back to 4.33%. The yield spread between long-term and short-term bonds widened to its largest since 2022, indicating market concerns over long-term debt risks. Investors shifted to short-term high-quality bonds as a hedge, reflecting concerns about the stability and creditworthiness of U.S. policies.

04/19 16:36

Faced with rising costs of baby products due to tariff pressure, new parents in the United States are turning to second-hand markets.

The United States has imposed tariffs as high as 145% on Chinese goods, leading to a spike in the prices of baby products and toys, impacting how new parents raise their children. With nearly 90% of these products being imported from China, many families are turning to the second-hand market to manage the high costs. The increased demand for second-hand goods shows how American families are adjusting their lifestyles in response to trade policies.

Delayed Effects of the Tariff War: Impact on Taiwan's Consumer and Real Estate Markets

Lai Cheng-yi noted that although the 32% high tariff imposed by the United States on Taiwan is shocking, he predicts that the final implemented rate may fall between 10% and 15%, making the actual impact more manageable. However, this wave of the tariff war will gradually affect Taiwan's domestic market, expected to influence consumer behavior within the next one to two years, thereby impacting the real estate market performance.

He stated that the increase in tariffs will raise import costs, driving inflationary pressure, which in turn will reduce disposable income and affect the willingness to purchase homes and consume. However, Taiwan currently has an excess savings of NT$4.5 trillion, with a savings rate of 17%, indicating that the financial side remains relatively loose. This means that even when facing rising costs and slowing demand, housing prices remain supported, especially in core urban areas. As for the suburban areas, there may be partial price loosening.

Taiwan's Real Estate Market Imbalance: Developers Shift to "Slow Build, Slow Sell" Strategy

Although housing prices are unlikely to fall in the short term, there have been changes on the supply side of the market. According to data from the Ministry of the Interior, the third quarter of 2024 saw record highs in the number of residential building permits and construction starts, reaching 46,598 and 40,442 units respectively, with annual growth rates of 21.83% and 30.92%. However, market demand has not grown in tandem, leading to increasing supply pressure.

Scholars have analyzed that developers, to avoid the expiration of building permits, have chosen to concentrate on starting construction, but their actual sales strategy has shifted to "slow build, slow sell" to cope with economic uncertainty and financial pressure. If the future volume of pre-sale home transactions cannot rise above 6,000 units per month, the market may face selling pressure due to oversupply.

Taiwanese Businesses Shift to Domestic Sales and Digital Marketing to Tackle Export Challenges

With the Chinese economy under pressure from high U.S. tariffs, many Taiwanese businesses in China are beginning to consider shifting from exports to domestic sales. Lai Cheng-yi noted that Taiwanese businesses face challenges in sales channels and marketing experience during the transformation process, but he believes these issues can be resolved with the help of professional teams.

He suggested that Taiwanese businesses should actively learn to use digital tools, such as TikTok live streaming for sales, to enhance brand exposure and sales efficiency. He emphasized that as long as the products are competitive, there is no fear of market competition.

Recovery in China's Real Estate Market and Decline in Building Material Costs Signal Investment Opportunities

Despite the recent slump in China's real estate market, Lai Cheng-yi believes it is currently in the early stages of recovery. He noted that the Chinese government is actively promoting real estate consumption and investment, and building material costs are gradually declining due to rising demand, creating a favorable opportunity for investment.

He cited his group's investment of RMB 7 billion in a comprehensive commercial cultural and art center in Jinhua, Zhejiang, which officially began operations last year, with plans for continued investment. He candidly stated, "Real estate in China is definitely the opportunity for this year and next; if you don't enter now, you'll regret it."

Cross-Strait High-Tech Cooperation: A Key to Industrial Upgrading

Against the backdrop of global supply chain restructuring and intensified competition in the high-tech industry, Lai Cheng-yi called for deeper cross-strait cooperation in high-end manufacturing fields such as precision machinery and semiconductors. He pointed out that Zhejiang is actively developing innovative industries, and combining this with Taiwan's technological advantages will help promote industrial upgrading and improve grassroots livelihoods.

He emphasized that the development of high-end manufacturing not only creates more job opportunities but also improves the quality of life for people on both sides of the strait. He believes that stable cross-strait economic and trade relations are crucial for Taiwan's future development and that cooperation opportunities should not be interrupted by trade wars.

Tourism and People-to-People Exchange Await Recovery

Lai Cheng-yi also mentioned that the recovery of Taiwan's tourism industry still relies on the return of Chinese tourists. He hopes that cross-strait free travel and group tours can resume soon, returning to the peak level of 4.18 million visits in 2015, and restoring the close exchanges of 71 direct flight cities and 290 weekly flights.

References

People Also Ask...

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What specific areas of cross-strait high-tech cooperation mentioned by Lai Cheng-yi can facilitate industrial upgrading?

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What challenges and opportunities does Lai Cheng-i mention for the Taiwanese housing market over the next year or two?

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In the high-tech cooperation between the two sides of the strait mentioned by Lai Cheng-yi, what specific areas are expected to see breakthrough developments?