Core Viewpoint - The implementation of a 20% tariff by the U.S. on Taiwan has raised significant concerns among Taiwanese industries, as it is higher than the 15% tariffs imposed on Japan, South Korea, and the EU, leading to fears of economic downturn and loss of competitiveness [2][4]. Group 1: Impact on Low-Margin Industries - Low-margin industries in Taiwan are expected to be the most severely affected by the new 20% tariff, as it will increase export costs significantly [5][7]. - Industries with an average gross margin below 20% are particularly vulnerable, with nine categories identified, including electrical cables, gas, electronic components, cement, textiles, electronics, steel, plastics, and optoelectronics [5][7]. - If a product's gross margin is lower than the tariff rate, companies may face losses, leading to potential halts in exports, capacity reductions, or layoffs [7]. Group 2: Competitive Disadvantage - Taiwan's 20% tariff creates a competitive disadvantage against similar products from Japan, South Korea, and the EU, which face only 15% tariffs [9]. - Key industries likely to suffer include machine tools, molds, plastic products, and electronic materials, as the additional 5% tariff could lead to a loss of market share in the U.S. [9]. - The increased tariff costs may force Taiwanese exporters to raise prices, which could result in losing long-term contracts to competitors from countries with lower tariffs [9]. Group 3: Crisis in Traditional Industries - Traditional industries in Taiwan that heavily rely on the U.S. market are facing significant challenges, with projected declines in output value ranging from 5% to 9% [10]. - Industries such as fasteners and automotive components, which have a high export ratio to the U.S., are particularly at risk of layoffs or mergers due to compressed profit margins [10]. - Agricultural sectors, including banana and fish farming, are also expected to see reduced competitiveness and income for farmers due to the tariff impact [10]. Group 4: Public Sentiment and Political Response - There is growing public discontent in Taiwan regarding the government's handling of the tariff situation, with calls for a reassessment of reliance on the U.S. market [12]. - Industry stakeholders are advocating for a shift towards stronger ties with mainland China, which is seen as a more viable market option [12]. - The current political leadership is criticized for being disconnected from the economic realities faced by the industries and the public [12].

Group 1 - The article discusses the resurgence of trade protectionism in the U.S. under Trump's administration, questioning whether it can lead to past economic successes [1] - Trump announced a 10% baseline tariff on all imported goods, effective April 5, with specific exemptions for a few North American countries [5] - The U.S. will impose reciprocal tariffs on its top 10 trade deficit countries, with Thailand facing the highest at 36%, followed by China at 34% and Indonesia at 32% [7] Group 2 - The average U.S. tariff rate is projected to rise from 2.5% to 9.8%, the highest since the Smoot-Hawley Tariff Act of 1930, with an estimated annual revenue increase of $162 billion [9] - The total U.S. goods imports for 2024 are expected to be $3.7 trillion, with significant contributions from China (18.2%), the EU (14.6%), and Mexico (13.8%) [9] - Consumers are expected to face an annual cost increase of $218 billion, averaging $1,700 per household, particularly affecting electronics, auto parts, and textiles [9] Group 3 - To implement these tariffs, Trump declared a national emergency, granting him expanded powers to address the fiscal deficit and national debt [10] - The trade policies may adversely affect traditional U.S. allies and the American public, with significant impacts on Southeast Asian economies and high-end manufacturing in South Korea and Japan [10][11] - European automakers and other industries are also expected to suffer, with potential price increases and contract risks due to the new tariffs [11] Group 4 - The article highlights the collapse of the global trade cooperation system led by the U.S., with 127 out of 164 WTO member countries initiating temporary trade barriers [12] - It suggests that the current trade protectionism may lead to a new global order, moving away from the previous mercantilist approach [12] - The article concludes that true prosperity comes from open trade rather than high tariffs, emphasizing the need for countries to respond to these protectionist measures [12]