Taiwan and the U.S. enjoy strong and mutually beneficial economic and trade relations, with high levels of supply chain integration boosting the competitiveness of key industries on both sides, according to a report compiled by the Cabinet-level Office of Trade Negotiations.
The report, a comprehensive review of two-way trade and future growth prospects, was submitted May 9 to the U.S. Department of Commerce by the Taipei Economic and Cultural Representative Office in the U.S. The U.S. department is soliciting comments to assist with the preparation of an analysis of the nation's trade deficits.
Highlighting import and export as well as investment trends, the OTN study explores Taiwan-U.S. economic relations across four main areas: trade balance, fair trade, manufacturing links and national security, and future development. It concludes that due to the complementary structures of the Taiwan and U.S. economies, trade ties are beneficial to both sides and have no negative impacts on industrial growth or employment in the U.S.
According to the report, goods and services trade between Taiwan and the U.S. totaled an estimated US$84.9 billion in 2016. The U.S. recorded a deficit of about US$13.3 billion for trade in goods and a services trade surplus of US$4.2 billion.
Overall, Taiwan was the U.S.' 10th largest goods trading partner last year and seventh largest agricultural export market. The U.S. enjoys a trade surplus in agricultural products of some US$3 billion.
Taiwan is not a major exporter of products in which the U.S. has large trade deficits, the study stated, adding that industries on both sides are highly complementary, with supply chain integration spanning key sectors including automobile and aerospace components, integrated circuits, machine tools and medical devices.
The report also spotlights Taiwan's commitment to fair, transparent and open market practices, noting that the government has implemented trade, intellectual property protection and labor regulations consistent with international standards. These efforts have been recognized by the American Chamber of Commerce in Taipei, which has positively assessed the nation's business environment.
Other issues discussed include Taiwan-U.S. collaboration on customs enforcement as well as exports controls for strategic high-tech commodities. These efforts are seen as strengthening fair trade and promoting regional peace and stability.
The report highlights strong potential for growth in two-way trade, with Taiwan demand for U.S. aerospace components, agricultural goods, services and semiconductors expected to rise. Taiwan investment in the U.S. is also forecast to increase, with a preliminary estimate of future investments totaling US$34.1 billion.
This expansion in economic and trade cooperation will be facilitated by two-way platforms such as the Digital Economy Forum, a framework for promoting sustainable and inclusive growth through the application of emerging information and communication technology solutions. The report notes that Taiwan is also a keen participant in the U.S. Department of Commerce's Select USA forum, with more than 70 businesses and 100 executives signing up to attend the June 2017 edition of the investment summit.
Source: Taiwan Today