The Trump administration reached a trade deal with Taiwan on Thursday, with Taiwan agreeing to remove or reduce 99% of its tariff barriers, the office of the U.S. Trade Representative said.

The agreement comes as the U.S. remains reliant on Taiwan for its production of computer chips, the exporting of which contributed to a trade imbalance of nearly $127 billion during the first 11 months of 2025, according to the Census Bureau.

Most of Taiwan’s exports to the U.S. will be taxed at a 15% rate, the USTR’s office said. The 15% rate is the same as that levied on other U.S. trading partners in the Asia-Pacific region, such as Japan and South Korea.

Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick attended the signing of the reciprocal agreement, which occurred under the auspices of the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States. Taiwan’s Vice Premier Li-chiun Cheng and its government minister Jen-ni Yang also attended the signing.

computer chips, the exporting of which contributed to a trade imbalance of nearly $127 billion during the first 11 months of 2025, according to the Census Bureau.

Most of Taiwan’s exports to the U.S. will be taxed at a 15% rate, the USTR’s office said. The 15% rate is the same as that levied on other U.S. trading partners in the Asia-Pacific region, such as Japan and South Korea.

Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick attended the signing of the reciprocal agreement, which occurred under the auspices of the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States. Taiwan’s Vice Premier Li-chiun Cheng and its government minister Jen-ni Yang also attended the signing.

“President Trump’s leadership in the Asia-Pacific region continues to generate prosperous trade ties for the United States with important partners across Asia, while further advancing the economic and national security interests of the American people,” Greer said in a statement.

The Taiwanese government said in a statement that the tariff rate set in the agreement allows its companies to compete on a level field with Japan, South Korea and the European Union. It also said the agreement “eliminated” the disadvantage from a lack of a free trade agreement between Taiwan and the U.S.

The deal comes ahead of President Donald Trump’s planned visit to China in April and suggests a deepening economic relationship between the U.S. and Taiwan.

Taiwan is a self-ruled democracy that China claims as its own territory, to be annexed by force if necessary. Beijing prohibits all countries it has diplomatic relations with — including the U.S. — from having formal ties with Taipei.

Cheng said Taiwan hopes the agreement will make it a strategic partner with the U.S. “so as to jointly consolidate the democratic camp’s leading position in high technology.”

The agreement would make it easier for the U.S. to sell autos, pharmaceutical drugs and food products in Taiwan. But the critical component might be that Taiwanese companies would invest in the production of computer chips in the U.S., possibly helping to ease the trade imbalance.