The confirmation that Taiwan’s reciprocal tariff on exports to the United States has been set at 15% without stacking, bringing it in line with major competitors such as Japan and South Korea, is regarded as one of the major achievements in Taiwan–U.S. tariff negotiations. However, players across Taiwan’s textile and apparel supply chain have bluntly stated that “the industry chain has already been broken.” For most domestic manufacturers, while the policy can be viewed positively in terms of easing psychological pressure, its practical benefits remain limited.
Industry participants note that Taiwan’s textile sector has long been squeezed by low-priced dumping of textile products from mainland China, and in recent years has further borne the burden of rising electricity costs, labor expenses, and raw material prices, gradually hollowing out the industry’s value. The dual shockwaves of reciprocal tariffs and sharp exchange-rate volatility in 2025 have further dealt heavy blows to multiple textile product categories in Taiwan.
In addition, Taiwan’s textile supply chain has migrated overseas for many years, and the proportion of textiles exported directly from Taiwan to the U.S. is relatively low. According to statistics from the Taiwan Textile Federation (TTF), Taiwan’s direct textile exports to the U.S. mainly consist of narrow fabrics, processed yarns, socks, and apparel, accounting for only about 9% of total textile exports. Over the years, much of the industry has relocated production to Southeast Asia, resulting in limited direct Taiwan-to-U.S. orders.
Far Eastern New Century (FENC), the only company in Taiwan with a fully integrated textile supply chain covering upstream raw materials, midstream synthetic fibers, and downstream apparel, pointed out that the group’s products exported from Taiwan to the U.S. currently include filament yarn, staple fiber, solid-state polymerization products, PET chips, and industrial yarns. However, products manufactured in Taiwan and directly exported to the U.S. account for only a small share of the group’s total revenue. Moreover, the group already operates production facilities in Southeast Asia (such as Vietnam) as well as in the United States, meaning the reduction of the reciprocal tariff to 15% offers limited overall benefit.
Chen Han-Ching, General Manager of Li Li Industrial, a major domestic processor of textured yarns, stated that the group currently only exports processed yarns to the U.S. The reduction of U.S. tariffs to 15% is expected to enhance relative competitiveness, but whether it will lead to a significant increase in orders remains to be seen.
From the downstream perspective, apparel manufacturer Makalot Industrial noted that since most apparel production has already shifted to Southeast Asia, the Middle East, and Africa, the reduction of Taiwan’s U.S. export tariff to 15% has no direct impact on the apparel sector.
Although the tariff reduction offers limited tangible benefits to the textile industry, the Taiwan Textile Federation emphasized that it is still positive for the portion of textile products exported to the U.S. Far Eastern New Century and Li Li Industrial both indicated that the lower reciprocal tariff ensures Taiwanese textile products are no longer disadvantaged by tax burdens when competing with rivals, which is a positive development. However, the actual benefits will still depend on market demand, customer sentiment, and exchange-rate movements.
Apparel industry players generally agree that the 15% non-stacked tariff is overall positive. While short-term effects may not be very evident, the medium- to long-term impact will depend on whether customers become more favorably inclined toward Taiwanese suppliers and place additional orders as a result.
