Taipei, May 10 (CNA) President Tsai Ing-wen (蔡英文) on Friday reassured the public that Taiwan's economic fundamentals are strong enough to withstand the impact of a planned increase in U.S. tariffs on certain Chinese products, but called on overseas Taiwanese firms to return home amid a renewed trade war between the U.S. and China.
Tsai made the remarks at a press conference at the Presidential Office following a high-level national security meeting held Friday morning to discuss countermeasures as Washington and Beijing enter a new round of tariffs.
"Starting today, the U.S. is to increase tariffs on US$200 billion worth of Chinese goods from 10 percent to 25 percent, which could have a tremendous impact on the world economy," Tsai said.
Fortunately, its impact on Taiwan remains limited, she added, given that the goods covered by current punitive U.S. tariffs do not include Taiwan's main export products.
Tsai said Taiwan's solid economic foundation in recent years will also allow it to better respond to the heightened trade conflict between the world's two largest economies.
She cited as examples the nation's 12 consecutive quarters of positive economic growth, increased overseas investment and more than NT$250 billion (US$8 billion) of repatriated investments by Taiwanese businesses so far this year.
In a tweet on Sunday, U.S. President Donald Trump said he would increase U.S. tariffs on certain Chinese goods from 10 percent to 25 percent, starting this Friday, and would "shortly" introduce a 25 percent tariff on US$325 billion worth of previously untaxed goods.
He levied tariffs on US$250 billion worth of Chinese products last year, to which China retaliated with duties on US$110 billion worth of American goods.
As the ongoing U.S.-China trade war is bound to impact the existing global trading order and supply chain, Taiwan must choose the correct path for economic development, Tsai said.
"Our goals are to expedite the return of overseas Taiwanese businesses, rebuild our high added-value industry, facilitate comprehensive industrial upgrading, and push for the signing of a bilateral trade agreement with the U.S. that adheres to the principle of free and fair trade," she said.
She said the government would also endeavor to replace products manufactured in China with those of high value and quality made in Taiwan, seeking to turn the nation into a major exporter of goods to the U.S.
The president again warned against the establishment of a free economic zone recently proposed by pan-blue politicians, saying it risks confusing Taiwan-made and China-made products and thereby severely impeding Taiwan's economic transition and upgrading.
"It took Taiwan a lot of effort to break free from being economically caged in China...we should not return to that path," Tsai said, adding that the government would endeavor to put in place necessary mechanisms for repatriated funds this year to encourage more Taiwanese businesses to bring their money home.