US Overtakes China As Taiwan's Biggest Export Market For The First Time In Over 20 Years

Recent trade data shows that the U.S. has become the leading destination for Taiwanese exports, overtaking China.

What Happened: Taiwan’s exports to the U.S. increased by 65.7% year-on-year in March, totaling $9.1 billion. In contrast, exports to mainland China saw a modest increase of 6%, amounting to $7.9 billion. This is a marked change from the past, with China being the main recipient of Taiwanese exports since 2003, reported Bloomberg.

The Finance Ministry in Taipei released the data on Wednesday, coinciding with a significant meeting between Chinese leader Xi Jinping and former Taiwan President Ma Ying-jeou. Despite the leaders emphasizing the close ties between the two sides of the strait, the trade data suggests a diverging narrative.

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This change in export destinations reflects a shift in global trade relationships, driven by consecutive U.S. administrations’ efforts to lessen the dependence of the world’s largest economy on Chinese-made goods. This trend is not exclusive to Taiwan, as South Korea’s exports to the U.S. surpassed those to China at the end of 2023.

Why It Matters: This shift in Taiwan’s export market comes amid a series of significant events. A meeting between the Chinese President and several U.S. CEOs in late March saw Jinping providing “tough answers” to questions about the economy, chips, and Taiwan.

Following this, a powerful earthquake in Taiwan in early April rattled the semiconductor supply chain, highlighting the global dependence on Taiwan for chips.

Furthermore, Jinping’s meeting with Taiwan’s Former President Ma Ying-Jeou amid rising cross-strait tensions and the surge in Taiwan’s ETF market led by the AI stock craze, particularly from key Nvidia and Apple supplier Taiwan Semiconductor Manufacturing Co TSM, further underscore the shifting dynamics in Taiwan’s economic and geopolitical landscape.

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