[US midterm election] Taiwanese expert says, “We need to focus on AI investment flow rather than tariffs”

A Taiwanese expert predicted that the 15% US tariff applied to Taiwanese products will not change despite the 'blue tsunami' (Democratic Party landslide victory) in the US midterm elections.

According to Taiwanese media, including the China Times, on the 5th, Chu Da-sung, executive director of the Association of Asia-Pacific Chambers of Commerce and Industry (CACCI), said this about the impact of the U.S. Democratic Party's takeover of the Federal Congress early next year and U.S. President Donald Trump's 'lame duck'.

Previously, the United States lowered national tariffs on Taiwanese products from 20% to 15%, and Taiwan signed a trade agreement in February that included eliminating or easing 99% of tariff barriers.

Executive Director Chu emphasized that it is difficult to judge the pros and cons for Taiwan's economy due to the Democratic Party's victory in the U.S. midterm elections, but emphasized that the key depends on President Trump's policy choices after the midterm elections and whether the U.S. economy and artificial intelligence (AI) investments can maintain growth momentum.

He predicted that President Trump, who suffered a crushing defeat, will be checked by Congress, especially in relation to tax cuts, fiscal spending and budget, during the remaining two years of his term.

However, he said that this does not mean that the enthusiasm for protectionism in the United States will cool down, and pointed out that President Trump may expand related policies by showing off the results through tariffs, trade negotiations, and pressure on foreign investment.

Executive Director Chu said that it is a matter of whether the slowdown in the U.S. economy and the decline in AI investment, which could be the biggest external risks to Taiwan's economy next year, occur simultaneously. If the two situations occur simultaneously, the impact on Taiwan's exports, corporate profit generation, and the stock market will be more direct than which political party controls the National Assembly.

He therefore emphasized that Taiwan must pay attention to the slowdown in U.S. economic growth, the adjustment of investments by AI-related big tech companies, and the demand for new economic trade that is likely to emerge in the U.S.