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- US, Taiwan reach deal on first part of '21st Century' trade pact
US, Taiwan reach deal on first part of '21st Century' trade pact
As per the latest announcement from the US Trade Representative's (USTR) office, published late Thursday by Reuters, “The US and Taiwan reached agreement on the first part of their ‘21st Century’ trade initiative, covering customs and border procedures, regulatory practices, and small business.”
The official announcements also accompany comments from USTR Katherine Tai who said, “The deal strengthens US-Taiwan relations and demonstrates that they can work together to advance trade priorities for their populations.”
Additional details
The pact is not expected to alter goods tariffs but proponents say it will strengthen the economic bonds between the U.S. and Taiwan, open the Chinese-claimed island to more U.S. exports, and increase Taiwan's ability to resist economic coercion from China.
China has reacted furiously to Taiwan's President Tsai Ing-wen's recent engagements with high-ranking US politicians, including an April meeting with US House of Representatives speaker Kevin McCarthy.
The announcement of the trade pact comes just ahead of planned meetings between China's Commerce Minister Wang Wentao and USTR Tai and US Commerce Secretary Gina Raimondo.
Market implications
The news challenges the market’s optimism amid fears of more US-China tension, which in turn may prod the US Dollar buyers, especially due to the latest concerns about the hardships for the US debt ceiling deal passage. Even so, the AUD/USD and NZD/USD fail to immediately react to the news.
Also read: US House hardliners could try to block debt-ceiling deal without 'robust' cuts
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