Tariffs to slow Taiwan's GDP growth: NDC minister says

Taipei [Taiwan], April 10 (ANI): Taiwan's economy is set to take a notable hit from newly imposed US tariffs, with government officials warning of a sharp reduction in the country's GDP growth for 2025, Taipei Times reported.
National Development Council (NDC) Minister Paul Liu told lawmakers on Tuesday that based on preliminary assessments by a private research institute, the tariffs could lead to a drop in GDP growth ranging between 0.43 and 1.61 percentage points.
The 32 per cent reciprocal tariffs, which officially took effect yesterday, are expected to significantly impact Taiwan's economic momentum. Liu noted that the tariffs could push Taiwan's GDP growth below the previously forecast 3 per cent, and possibly even down to 1.53 per cent.
These projections come in contrast to the 3.14 per cent growth estimate released in February by the Directorate-General of Budget, Accounting and Statistics. To better understand the full implications, Liu said the council has commissioned another institution for additional analysis of both short- and long-term effects.
In light of the expected economic slowdown, legislators questioned the adequacy of current government support for affected sectors. Democratic Progressive Party (DPP) Legislator Lee Kuen-cheng asked whether the NTD 88 billion (USD 2.67 billion) relief fund allocated to assist local industries would be expanded.
Minister of Economic Affairs J.W. Kuo responded that the total would remain unchanged for now, but he did not rule out future increases. Kuo assured lawmakers that the fund could be adjusted depending on how the tariffs impact specific sectors.
Regarding the outlook for Taiwan's trade relationship with the United States, Kuo expressed cautious optimism. When asked by DPP lawmaker Chiu Yi-ying about ongoing negotiations with Washington, Kuo said, "Taiwan maintains good relations with Washington and the outlook for the negotiations looks promising."
His remarks reflect the government's hope that continued dialogue will lead to a mutually acceptable solution.
To manage the situation, the government has assembled a task force led by Vice Premier Cheng Li-chun. The group includes representatives from the National Security Council (NSC), the Office of Trade Negotiations, various Executive Yuan agencies, and members of academia and industry, reported Taipei Times.
NSC Director-General Tsai Ming-yen confirmed that Taipei has initiated conversations with Washington to discuss the tariffs. "Last weekend, we used channels to talk to the US to reflect our position on Taiwan-US tariff negotiations and some of our proposals," Tsai told reporters, without offering further details. He also clarified the government's strategic stance: "The government's position was not to take retaliatory measures, but to come up with more specific solutions."
In the meantime, domestic measures are being expanded to help companies withstand the fallout. Minister Kuo said the Ministry of Economic Affairs would enhance its one-stop service centre, which supports businesses in navigating relief options. A new team of consultants will also be formed to provide tailored, practical guidance to both traditional industries and small and medium-sized enterprises (SMEs).
"We will require our one-stop service centre and consulting team to respond to companies' questions within one day, and make sure to provide them with practical and tailor-made solutions," Kuo said.
Additionally, the government is easing financial support requirements for firms seeking assistance. It plans to abolish the current rule requiring a 15 per cent drop in revenue before businesses qualify for aid or loans. Expanded access to preferential loans, loan guarantees, R&D subsidies, and export promotion resources is also being implemented, Taipei Times reported.
Taiwan's economy is heavily reliant on SMEs, which make up 98.9 per cent of all businesses and employ over 9 million people, according to ministry data. Its traditional manufacturing sector, centred on metal products, machinery, and plastics, generates more than NTD 11.24 trillion in annual production value. (ANI)