The Biden administration is kicking off talks with Taiwan on an agreement to facilitate more trade between the countries without reducing tariffs, according to senior administration officials.
The USDA’s Foreign Agriculture Service estimates that just last year Taiwan became the sixth largest foreign market for U.S. agriculture commodities after importing $3.94 billion worth of beef, dairy, soybeans, fruit, tree nuts, vegetables and other products.
The 18% increase in Taiwan’s ag imports from the U.S. in 2021 comes despite relatively high tariffs, according to the U.S. Commerce Department. The average Taiwanese tariff on industrial goods is 4.16%, but that jumps to 15.12% for agricultural commodities.
U.S. and Taiwanese officials will lay out a blueprint for the pact in the coming days, and then both sides will meet in Washington later this month to start official negotiations for the U.S.-Taiwan Initiative on 21st Century Trade.
Administration officials told reporters the agreement won't need approval from Congress because there are no plans for new market access requirements in the deal that is broadly similar in scope to the larger Indo-Pacific Economic Framework that the U.S. is negotiating with Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam. Taiwan was controversially left out of IPEF.
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The Office of the U.S. Trade Representative offered only a brief one-sentence explanation of the ag component for the Taiwan deal, saying that the U.S. and Taiwan “intend to explore provisions to facilitate agricultural trade through science and risk-based decision making and through the adoption of sound, transparent regulatory practices.”
Farm groups made clear after the debut of IPEF that while they appreciate any deals that further agricultural trade, they should include new market access provisions.
“We’re still assessing it,” International Dairy Foods Association President and CEO Michael Dykes said of the plans for a U.S.-Taiwan pact. “We clearly would love to see trade agreements to address tariffs.”
The U.S. exported $167 million worth of dairy to Taiwan last year, a 15% increase from 2020, according to the FAS office in Taipei.
U.S. beef exports to Taiwan are rising even faster. The FAS says the U.S. shipped $668 million worth of beef to Taiwan in 2021, a 21% increase from 2020 and a new record high. According to the U.S. Meat Export Federation, the U.S. exported $227.2 million worth of beef to Taiwan in just the first three months of 2022, a 92% increase from the first three months of last year.
