Taiwan flags US semiconductor probe as bigger uncertainty despite favourable Section 301 tariff
New Delhi, July 24
A separate US Section 301 investigation into semiconductor overcapacity poses a bigger source of uncertainty for Taiwan than the latest US tariffs, according to a news story published by Focus Taiwan, which cited economists as saying the outcome of the probe could have a greater impact on the island's technology sector.
The story said the concern comes even as Taiwan views the newly announced US Section 301 tariffs as relatively favourable. The United States has imposed a 10 per cent Section 301 tariff on certain goods from Taiwan as part of measures targeting imports from economies that it says have not adequately enforced bans on goods produced with forced labour. The tariffs are set to take effect on Friday (US time).
According to Focus Taiwan, the Taiwan Institute of Economic Research (TIER) said Taiwan's 10 per cent tariff rate compares favourably with the 12.5 per cent duty imposed on several other economies, including Japan and China.
The story quoted TIER President Chang Chien-yi as saying Taiwan's comparatively lower tariff rate partly reflects its efforts to address US concerns over forced labour. He added that the new tariff structure could narrow the tariff disadvantage traditionally faced by Taiwanese exporters, particularly in industries such as automobile parts.
Focus Taiwan also said that products from Taiwan already subject to a most-favoured-nation (MFN) tariff of 10 per cent or more will not face an additional Section 301 duty. For products with an MFN tariff below 10 per cent, the combined MFN and Section 301 tariff will total 10 per cent.
However, TIER economist Liu Pei-chen said a separate US Section 301 investigation into semiconductor overcapacity, expected to conclude by the end of July, remains the bigger concern.
According to the story, advanced-node foundries are likely to be less affected, while mature-node foundries could face greater exposure because concerns over excess capacity are concentrated in that segment.
The story further quoted Chang as saying Taiwan exports relatively few semiconductors directly to the United States, with many chips shipped to other countries for assembly into information and communications technology products.
However, he said the impact could become more significant if Washington were to impose tariffs on finished products containing chips that are not manufactured in the United States.
— ANI
Reader Comments
Interesting how Taiwan gets a 10% tariff while others like China face 12.5%. Shows how geopolitics shapes trade policies. For India, this is a reminder that we need to reduce dependence on any single country for chips. Taiwan's mature-node foundries might take a hit, but their advanced nodes are still safe. Smart balancing act by US.
As an Indian watching this, I feel for Taiwanese companies caught in this crossfire. But also, this is why 'Make in India' and our semiconductor push is so important. We cannot afford to be at the mercy of such probes. Time to fast-track those fabrication units! 🇮🇳
Honestly, I'm not surprised. The US has been tightening its tech supply chains for years. Taiwan's semiconductor industry is world-class but also overly concentrated. If US starts taxing finished products containing non-US chips, that could disrupt entire global electronics supply chains. India should watch and learn how not to be too dependent on one market. Critical thinking needed here, not just cheerleading.
Yeh sab US-China trade war ka side effect hai. Taiwan bich mein phas gaya. Lekin Indian perspective se, this shows how important self-reliance is. Our Atmanirbhar Bharat in electronics needs to pick up pace. Imagine if India had a chip fabrication plant running now - we'd be laughing all the way to the bank! 🚀
The economist's point about mature-node foundries being more exposed makes sense. China has been investing heavily in older chip tech while Taiwan dominates advanced nodes. For India, this is actually an
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