Taiwan has climbed to become the seventh-largest trading partner of the United States in 2024, moving one spot up from 2023. According to a recent Executive Yuan trade report, Taiwan-U.S. trade reached $158.6 billion, marking a significant 24.2% year-on-year increase. This growth has been attributed to geopolitical trade shifts, strong AI-driven demand, and Taiwan’s increasing dominance in the semiconductor industry.
Understanding International Trade and Taiwan’s Role
What is International Trade?
Trade refers to the exchange of goods and services between countries. It allows nations to leverage their strengths—such as manufacturing, technology, or natural resources—while importing goods they lack. International trade is measured by exports (goods sent to other countries) and imports (goods received from other countries).
Taiwan’s Strength in Trade
Taiwan is a key player in global trade, particularly in the technology sector. The nation is a global leader in semiconductor manufacturing, information and communications technology (ICT), and electronics production. Taiwan’s export-driven economy relies heavily on international markets, making trade agreements and geopolitical trends crucial to its growth.
Taiwan’s Position in U.S. Trade – Growth and Ranking
- Taiwan was the 8th largest U.S. trading partner in 2023 but rose to 7th place in 2024.
- The total trade volume between Taiwan and the U.S. hit $158.6 billion, growing 24.2% from 2023.
- Taiwan’s trade now accounts for 2.97% of total U.S. trade.
Breakdown of Taiwan-U.S. Trade in 2024
| Trade Category | 2023 (in Billion $) | 2024 (in Billion $) | Growth Rate |
|---|---|---|---|
| Total Trade | 127.7 | 158.6 | 24.2% |
| U.S. Exports to Taiwan | 39.9 | 42.3 | 6% |
| U.S. Imports from Taiwan | 87.7 | 116.2 | 32.5% |
| U.S. Trade Deficit | 47.8 | 73.92 | 54.6% |
📌 Key Takeaway: The U.S. imported far more from Taiwan than it exported, resulting in a trade deficit of $73.92 billion, which grew 54.6% year-on-year. Taiwan now has the sixth-largest trade surplus with the U.S..
Future Growth – How Will Taiwan’s Trade Expand?
Projected Trade Growth (2025-2030)
Industry analysts predict that Taiwan-U.S. trade will continue growing, driven by:
- Rising demand for semiconductors due to AI, cloud computing, and IoT (Internet of Things).
- Ongoing U.S.-China trade tensions, which encourage American companies to source products from Taiwan instead of China.
- Taiwan’s government policies supporting local manufacturing and foreign investments.
📊 Projected Growth Rate (2025-2030):
- 2025: Expected growth of 10-15%.
- By 2030: Taiwan’s trade volume with the U.S. could exceed $200 billion if current trends continue.
Taiwan’s Integrated Circuit (IC) Exports – A Key Driver of Growth
Taiwan is a global leader in semiconductor manufacturing, with companies like TSMC (Taiwan Semiconductor Manufacturing Company) producing the world’s most advanced integrated circuits (ICs).
📌 Taiwan’s IC Export Ranking in 2024:
- The U.S. was Taiwan’s 7th largest IC export market.
- IC exports to the U.S. reached $7.4 billion, a 111.66% increase from 2023.
- ICs made up 6.65% of Taiwan’s total exports to the U.S..
📌 Why Did IC Exports Increase?
- The AI boom increased demand for high-performance chips.
- The U.S. imposed restrictions on China’s semiconductor industry, benefiting Taiwan.
- Companies shifted supply chains from China to Taiwan to reduce risks.
Profits and Losses – Taiwan’s Trade Balance Analysis
✔️ Taiwan’s Profits (Gains in 2024):
✅ Trade surplus with the U.S. increased by 54.6%, reaching $73.92 billion.
✅ Strong growth in technology exports boosted Taiwan’s economy.
✅ Government policies successfully attracted investments from overseas Taiwanese businesses.
❌ Potential Losses or Risks for Taiwan:
❌ Dependence on U.S. demand: If U.S. companies find alternative suppliers, Taiwan’s exports could slow.
❌ Geopolitical risks: Any change in U.S.-Taiwan-China relations could impact trade.
❌ Supply chain issues: Global shortages in materials like silicon could disrupt semiconductor production.
Conclusion – Taiwan’s Trade Future Looks Promising
Taiwan’s trade position with the U.S. has strengthened significantly, driven by semiconductor demand, geopolitical trade shifts, and government-backed policies. With a 24.2% growth rate, Taiwan has become the 7th largest trading partner of the U.S., and analysts expect further expansion in the coming years.
However, Taiwan must navigate global supply chain challenges, geopolitical risks, and economic uncertainties to maintain this momentum. If successful, Taiwan’s trade with the U.S. could surpass $200 billion by 2030, solidifying its place as a global economic powerhouse.
Why did Taiwan’s trade with the U.S. increase in 2024?
The rise is due to strong demand for technology products, geopolitical shifts in trade, and Taiwan’s advanced semiconductor industry.
What is Taiwan’s ranking as a U.S. trading partner in 2024?
Taiwan is now the 7th largest trading partner of the United States, moving up one spot from 2023.
What are Taiwan’s top exports to the U.S.?
Automatic data processing equipment/components ($51.49 billion, 140.29% growth).
Integrated Circuits (ICs) ($7.4 billion, 111.66% growth).
What is the trade deficit between the U.S. and Taiwan?
The U.S. trade deficit with Taiwan reached $73.92 billion, a 54.6% increase from 2023.
Will Taiwan’s trade with the U.S. continue growing?
Yes, analysts predict 10-15% annual growth in the coming years, with total trade potentially exceeding $200 billion by 2030.
