Taipei, The United States' plan to impose tariffs on imported steel and aluminum will undermine free trade in the global market, the Ministry of Economic Affairs (MOEA) said Friday.
The comments came after U.S. President Donald Trump said Thursday that his administration will impose tariffs on steel and aluminum imports as early as next week.
Tariffs on steel imports will hit 25 percent, and the tariffs on aluminum imports will reach 10 percent, but it remains unclear whether the high duties will be applied to imports from all countries or only certain countries.
The MOEA said it will wait to see how the U.S. implements the new tariffs before assessing their impact on Taiwanese exporters, but it stressed that such a measure reflects the trade protectionism Trump has advocated and will no doubt negatively affect global trade.
Trump's announcement prompted an outcry from Canada, which threatened retaliation against the U.S., according to international media, and other trading partners were unhappy as well.
The MOEA said a plunge on Wall Street and other financial markets showed many investors were concerned by the possibility of a global trade war if Washington follows through on its tariff plan next week as scheduled.
Following a 1.68 percent plunge suffered by the Dow Jones Industrial Average overnight, the weighted index on the Taiwan Stock Exchange closed down 0.81 percent on Friday, with the steel sector down 1.63 percent.
Among the falling steel stocks here, China Steel Corp., the largest steel maker in Taiwan, fell 1.84 percent, and China Steel Structure Corp., a subsidiary of China Steel, shed 2.19 percent, while Tung Ho Steel Enterprise Corp. lost 1.38 percent.
Elsewhere, Steel & Sumitomo Metal Corp. of Japan shed 3.8 percent. South Korea's Pohang Iron and Steel Co. (POSCO) lost 3.6 percent and Hyundai Steel Co. fell 3 percent, while in China, Baosteel Group Corp. also dropped 3.9 percent.
The U.S. has imposed anti-dumping tariffs on 13 steel products sold by Taiwanese firms to date, including carbon and alloy steel plates and steel concrete reinforcing bars, the ministry said.
It was unclear, however, whether or not the new tariffs will be added to the existing tariffs.
Wu Tsai-yi (???), president of the Taiwan Research Institute, said that if Taiwan is affected by the new tariffs, Taiwanese companies should find alternative markets to the U.S. as soon as possible to reduce the impact of the new tariffs.
According to U.S. Customs data, Taiwan's steel product exports to the U.S. totaled US$3.62 billion in 2017, accounting for 5.61 percent of total U.S. imports, while Taiwan's aluminum product exports to the U.S. totaled US$57.12 million, or 0.33 percent of U.S. imports.
Source: Focus Taiwan News Channel