Taiwan-US trade deal brings long-sought FTA closer

Significance

This is the first agreement negotiated under the US-Taiwan Initiative on 21st Century Trade, a framework established in August 2022 to facilitate trade talks.

Impacts

• China has objected, but is unlikely to lash out in the same way that it has over US arms sales and the visits of US politicians to Taiwan.
• Ahead of elections next year, the main opposition party, the Kuomintang, is likely to call for greater protections for Taiwan’s farmers.
• If elected, the Kuomintang would still continue talks in pursuit of an FTA.
• An FTA with Washington would constitute Taiwan’s single most important FTA and a major boost to the prestige of the government in Taipei.