Will the Taiwan-US tariffs be reduced to 15%? Zheng Lijun went to the US last night for negotiations. The financial industry has over 14 trillion USD in exposure to the US but remains manageable.

The Taiwan-U.S. tariff will be reduced to 15%. Vice Premier Cheng Li-chun has already gone to the U.S. for negotiations last night, and it is expected that the consensus will be officially announced after the negotiations conclude. The financial industry’s exposure to the U.S. exceeds NT$14 trillion, and the Financial Supervisory Commission assesses the risk as controllable.

Taiwan-U.S. tariff reduction to 15%? Cheng Li-chun has gone to the U.S. for negotiations

Recently, Taiwan-U.S. trade negotiations have entered a critical stage. According to The New York Times, the U.S. plans to lower Taiwan’s import tariff rate from 20% to 15%, aligning treatment with Japan, South Korea, and other Asian allies. However, the condition is that TSMC must commit to building at least five additional semiconductor wafer factories in Arizona.

In response to foreign media reports, the Executive Yuan’s Office of Economic and Trade Negotiations responded to PTS News Network that both Taiwan and the U.S. have reached a certain level of consensus on related issues. The negotiation team’s goal has always been to secure tariff reductions, prevent stacking of tax rates, and obtain preferential treatment for semiconductor derivatives.

Additionally, Vice Premier Cheng Li-chun and Chief Negotiator Yang Zhen-ni left for the U.S. last night (1/14) to start a new round of in-person negotiations.

The government team will focus on confirming the details of tariff reductions, semiconductor supply chain cooperation, and four other major objectives. It is expected that the consensus will be announced publicly after negotiations, and an agreement will be signed at a later date.

Further reading:
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Financial Supervisory Commission: Financial industry’s exposure to the U.S. exceeds NT$14 trillion

While tariff negotiations are ongoing, the FSC announced the latest statistics. According to the Economic Daily News, as of the end of November 2025, the total exposure of the entire financial industry to the U.S. has surpassed NT$14 trillion, reaching NT$14,027.5 billion.

Breaking down the exposure among the three major financial sectors, the insurance industry accounts for the highest, with exposure exceeding NT$9.6824 trillion; followed by domestic banks, with exposure around NT$4.2384 trillion, covering deposit withdrawals, credit, and investments; the securities, futures, and fund management industries have a relatively smaller scale of exposure, about NT$106.7 billion, mainly concentrated in proprietary trading investments.

FSC: Banks are financially sound, risks are fully controllable

In response to concerns that tariff policy changes might impact the financial markets, Wang Yun-chung, Deputy Director of the Banking Bureau of the FSC, emphasized that the U.S. tariff measures have no direct impact on the insurance industry, and the overall financial risk remains within controllable limits.

According to Central News Agency, by the end of November 2025, the cumulative pre-tax profit of domestic banks reached NT$550.6 billion, with reserve coverage ratios and overdue loan ratios indicating stable operations.

Wang Yun-chung stated that the FSC has previously conducted stress tests regarding U.S. tariff changes and financial market volatility. The results show that even under severe scenarios, banks still possess sufficient risk-bearing capacity.

To assist the industry in responding to the changing situation, the Banking Association has extended relevant relief measures until December 31, 2026, including loan extensions and accelerated review of new loans, aiming to support industry development through financial strength and stabilize the domestic economy.

Further reading:
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