U.S. Reciprocal Trade Agreement with Taiwan Addresses Longstanding Trade Issue

WASHINGTON, DC – Last week, U.S. Trade Representative Jamieson Greer attended the signing of an Agreement on Reciprocal Trade between the United States of America and Taiwan (AIT), under the auspices of the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office (TECRO) in the United States.  Taiwan’s Vice Premier Li-chiun Cheng and Minister without Portfolio Jen-ni Yang also attended the signing.

Negotiations regarding this Agreement have been underway since last spring when President Donald Trump announced the onset of reciprocal tariffs on Liberation Day.  Important to the U.S. rice industry, the agreement includes a commitment for Taiwan to address a longstanding issue around ceiling prices and failed tenders.  The Taiwan government is committed to purchasing 64,634 MT of U.S. rice under a country-specific quota under their WTO commitments.  For years, USA Rice has pressed Taiwan on the imposition of “ceiling prices” that are calculated using a black box formula and unable to be shared, which regularly resulted in failed tenders for the U.S. as well as other origins.

The deal commits TECRO to provide to the AIT the ceiling price, the methodology used to calculate the ceiling price, and a detailed explanation of the methodology three weeks before each U.S. tender.  If AIT raises concerns regarding the ceiling price or methodology, the agreement commits Taiwan to address those concerns expeditiously. 

“We are pleased to see our longstanding challenges be addressed through this Reciprocal Agreement,” said USA Rice Director of International Trade Policy Karah Janevicius.  “For years, we have called for action on this unfair trade barrier restricting our already limited market access.  Taiwan is an important market for our industry and we look forward to working with TECRO and AIT to ensure proper implementation.”

President Trump also announced a Framework Agreement on Reciprocal Trade with North Macedonia last week that aims to eliminate tariffs on all U.S. agricultural goods, including rice, while maintaining a 15 percent baseline tariff on imported goods.  USA Rice will continue to monitor negotiations and developments of a final agreement.