Trump tariffs aim to cut trade deficit, won't affect security ties: Scholars

Taipei, April 4 (CNA) With U.S. President Donald Trump's new tariffs set to take effect in the coming days, scholars on Friday said the move aims to pressure countries into negotiations to reduce trade deficits, while security ties with allies will remain unaffected.

The scholars were reacting to Trump's announcement on Wednesday (Washington time) of sweeping "reciprocal tariffs" on dozens of countries, including Taiwan, whose exports to the United States will face an import duty of 32 percent starting April 9.

Chen Shih-min (陳世民), an associate professor at National Taiwan University's Department of Political Science, told CNA that tariffs are not the main focus but rather a tool to pressure other countries into negotiations with the Trump administration.

Chen said Trump's primary goal is to reduce the U.S. trade deficit, as reflected in the formula used to calculate the upcoming "reciprocal tariffs" -- by dividing the U.S. goods trade deficit with a country by that country's exports to the U.S., converting the result into a percentage, and then halving it.

Taiwan's trade surplus with the U.S. stood at just over US$20 billion during Trump's first term but had grown to more than US$70 billion last year, according to Chen.

Such growth was largely driven by the rise of artificial intelligence and the surge in semiconductor exports from companies such as Taiwan Semiconductor Manufacturing Co. (TSMC) in recent years, Chen said.

"For Taiwan, the problem is not difficult to solve," he said, adding that to achieve the goal of reducing its trade surplus with the U.S., Taiwan could increase its procurement of American goods.

One example he cited was a recent move by Taiwan's state-run CPC Corp., which signed a letter of intent for trade and investment with Alaska LNG last week, agreeing to purchase liquefied natural gas from the U.S. state of Alaska.

Chen noted that Taiwan lacks domestic energy resources such as natural gas and oil, and shifting its energy purchases from the Middle East or Africa to the U.S. could help reduce the trade surplus with the U.S.

Following in the same vein, Kuo Yu-jen (郭育仁), chair of National Sun Yat-sen University's Institute of China and Asia-Pacific Studies, said that countries like Taiwan, Japan, and South Korea were likely to pursue negotiations with the U.S. and adjust their trade models accordingly.

Such approaches would differ from that of China, which will take countermeasures by imposing broad-based tariffs on U.S. goods, and the European Union, which might respond more mildly by targeting specific products with symbolic tariffs, Kuo said.

As for the impact on U.S. security ties with its allies, Kuo said they will remain unaffected despite the deteriorating economic and trade relationships between the U.S. and other countries.

Unlike his recent decisions to give orders for the U.S. to withdraw from multilateral organizations such as the World Health Organization, Trump is now maintaining the "minilateral" security frameworks established under his predecessor, Joe Biden, Kuo said.

He cited the AUKUS (Australia-United Kingdom-United States) security partnership as an example, noting that under the partnership's agreement, U.S. Virginia-class fast attack submarines will be stationed in Australia -- a country also included on Trump's list that is set to face a 10 percent baseline tariff.

Kuo further noted that the U.S., Japan, and South Korea had just conducted a joint naval exercise last week near South Korea's Jeju Island, with the "Balikatan" joint military exercises between the U.S. and the Philippines set to take place later in April.

All three Asian countries are included on Trump's "reciprocal tariffs" list, with Japan facing a 24 percent tariff, South Korea 25 percent, and the Philippines 17 percent.