As the global economy reels in the mist of “Black Monday”, the Taiwan Stock market has been hit particularly hard. The Taiwan stock market set a record for the largest drop in its history, falling 10 percent following the Trump tariffs.. The tariffs particularly target countries with a large trade balance with the US which has resulted in a 32% tariff on Taiwan.
Taiwanese Response
On Friday, Taiwan unveiled a T$88 billion ($2.65 billion) support package to assist companies affected by the recent tariffs. President Lai Ching-te followed up on Sunday, announcing plans for the island to increase imports from and investments in the United States, aiming to establish a zero-tariff agreement between the two nations.
In a post on his X account on Monday, written in English, Lai emphasized that Taiwan is not pursuing retaliatory tariffs. Instead, he stated, “We’ll begin discussions on bilateral zero tariffs.” He added, “To maintain Taiwan’s competitiveness, we’ll boost U.S. imports and implement additional measures. Together, we can create a golden era of shared prosperity.”
While microchips, Taiwan’s major export product, were exempt from tariffs, U.S. imports play a crucial role in Taiwan’s manufacturing supply chain, supporting everything from cars to mobile phones.
Taiwan Stock Market Measures
In an attempt to stop the market freefall the Taiwanese government has introduced some restrictions on the stock market in an attempt at stabilisation.The temporary measures include stricter limits on short selling.
In a statement released Sunday evening, the Financial Supervisory Commission (FSC) noted that Taiwan’s stock market had not yet reacted to the U.S. tariffs or the global fallout, as the country was in the middle of a long holiday weekend that started on Thursday.
While stopping short of an outright ban on short selling, the FSC announced it would significantly tighten restrictions. The FSC will slash the limit on intraday sell orders for borrowed securities from 30% of the stock’s average trading volume over the past 30 business days to just 3%. Whether this can make a major impact on the Taiwan stock market or if the government can reach a deal with the US, the coming days and weeks will tell us.
Source
Reuters – Taiwan stocks plummet in biggest one-day drop on record after US tariffs
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