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United States Congress Introduces Legislation to Initiate Free Trade Agreement with Taiwan

Strategic Insights

— 1 min read

Representatives in the US Congress are pushing for a closer economic partnership with Taiwan, introducing legislation that would initiate negotiations for a free trade agreement (FTA) between the two nations. The move is seen as a means to strengthen diplomatic ties, increase economic growth, and counter Chinese Communist Party aggression in the Indo-Pacific region.

Key Takeaways:

  • The legislation, introduced by Rep. Guy Reschenthaler (PA-14) and co-sponsored by Senators Pat Toomey (R-PA) and Reps. Steve Chabot (OH-1) and Mario Diaz-Balart (FL-25), aims to expand economic ties between the US and Taiwan.
  • A free trade agreement with Taiwan could create more jobs and stimulate economic growth in both countries, particularly in the Indo-Pacific region.
  • The US Department of Commerce estimates that Taiwan supports an estimated 208,000 US jobs as of 2015, and Taiwan's foreign direct investment stock accounts for $11.1 billion.
  • Bilateral trade in goods between Taiwan and the US accounted for $86 billion in 2019, a $24 billion increase from 2010.
  • Taiwan is the 10th largest trading partner with the US in goods and 11th largest trading partner overall, while being Pennsylvania's 18th largest export market, with an estimated $367.6 million in 2017.
  • The Senate reportedly supports the initiative, with Senator Toomey stating that building closer trade ties between the US and Taiwan would be a "win-win" for both countries.
  • The incoming Biden administration has been urged to make a trade agreement with Taiwan a priority.

Statistics:

  • Bilateral trade in goods between Taiwan and the US accounted for $86 billion in 2019, a $24 billion increase from 2010 (Source: U.S. Federal Reserve).
  • Taiwan is the 10th largest trading partner with the US in goods and 11th largest trading partner overall (Source: US Census Bureau).
  • Taiwan is Pennsylvania's 18th largest export market, with an estimated $367.6 million in 2017 (Source: Pennsylvania Department of Community and Economic Development).
  • Taiwan supports an estimated 208,000 US jobs as of 2015 (Source: U.S. Department of Commerce).
  • Taiwan's foreign direct investment stock accounts for $11.1 billion (Source: US Foreign Investment in the United States).

Sources:

  • Congressman Guy Reschenthaler (PA-14)
  • Congressman Steve Chabot (OH-1)
  • Congressman Mario Diaz-Balart (FL-25)
  • Senator Pat Toomey (R-PA)
  • Senator Toomey's press release (no date)
  • US Department of Commerce (2015)
  • US Census Bureau (2020)
  • Pennsylvania Department of Community and Economic Development (2017)
  • US Federal Reserve (2019)

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