By Eryk Michael Smith/KHT Staff
TAIPEI — Taiwan-U.S. trade, investment, and technology cooperation are likely to keep expanding after the Democrats’ midterm election victory, although Taiwan should prepare for changes in how Washington makes and oversees economic policy, trade specialist Roy Chun Lee (李淳) said.
Speaking at the Institute for National Policy Research (INPR) in Taipei on Nov. 5, Lee said the incoming Congress would demand a greater role in tariff policy, technology restrictions, and agreements negotiated by President Donald Trump’s administration.
The discussion also included INPR Vice President Kuo Yu-jen (郭育仁), who examined how the election could reshape U.S.-China-Taiwan relations.
Lee cautioned against expecting the election to produce a sweeping reversal of U.S. economic policy, particularly toward China.
“If everyone thinks this major Democratic victory will reverse U.S. tariff and technology policies, they will certainly be disappointed,” Lee said.
Lee, director of the Economic Law Research Center at the Chung-Hua Institution for Economic Research, said the most immediate change would likely be stronger congressional involvement after two years in which economic policymaking had been concentrated in the White House.
Lawmakers could use legislation, committee proceedings, and informal pressure to demand more consultation over decisions affecting trade and technology, he said.
Possible opening on tariffs
Lee said Washington’s treatment of China and its trade disputes with other economies are separate issues.
Democrats could challenge tariffs on partners such as Canada and Mexico and take a different approach to disputes involving the European Union and Indo-Pacific economies, including Taiwan, he said.
“Democrats may believe that, at this point, building alliances matters far more than treating everyone as an enemy,” Lee said.
That could create room for changes in tariffs affecting U.S. partners. Lee nevertheless presented those changes as possibilities rather than guaranteed outcomes.
On China, he expected a high degree of bipartisan agreement to continue. Both parties view China as a strategic competitor and have used export controls to restrict its access to sensitive technology, he said.
For Taiwan’s semiconductor industry, his assessment pointed toward continued U.S. restrictions on advanced chips, alongside demands for a more consistent decision-making process.
Lee said Democrats had sought clearer explanations of why particular exports threaten national security, how restrictions serve U.S. interests, and what costs they impose on American companies.
He expected controls on advanced chips to become stronger, with more explicit criteria for imposing or adjusting them.
Trade agreements face scrutiny
Lee said Congress could also insist on reviewing economic agreements reached by the administration, including arrangements involving Taiwan.
Greater scrutiny would not necessarily mean those agreements would be reopened or rewritten, he said. Washington has an interest in honoring commitments to its partners because reversing them could damage U.S. credibility.
Congress might instead seek changes to how existing agreements are implemented or require greater involvement in future negotiations.
“Whether that means the contents of our agreements will face changes or challenges, we really do not know,” Lee said.
He also anticipated efforts to amend laws that give the president authority to impose tariffs. Whether those proposals could become law would remain uncertain because Trump could veto them.
Even without legislation passing, congressional pressure could complicate the work of agencies such as the Office of the U.S. Trade Representative, which would have to manage competing demands from lawmakers and the White House, he said.
Investment push expected to continue
The U.S. drive to attract manufacturing investment was also unlikely to change fundamentally, Lee said, although the incentives offered to companies could shift.
He characterized the Democratic approach to rebuilding American manufacturing as relying more heavily on financial incentives, while Trump had placed greater emphasis on pressure.
Future policy could therefore include more encouragement for investment alongside the existing push for companies to expand U.S. production, he said.
Former Taiwanese representative to the United States Stanley Kao (高碩泰), speaking at the same forum, said Taiwan also needed to strengthen its relationships with state governments.
Taiwanese multinational companies, particularly those in high technology and semiconductors, have established substantial operations in the United States, making changes in state leadership consequential for their investments, Kao said.
He urged Taiwan to cultivate bipartisan support across federal and state institutions and avoid assuming that the election results would automatically advance its interests.
Lee’s overall assessment was that Taiwan-U.S. economic integration would continue, even as the policies and officials shaping it changed.
“Trade is increasing, investment is increasing, and so are talent exchanges and technology cooperation,” he said. “That trend should not change substantially.”
