Taiwan: The Price Trump Pays for Tariffs

On April 23, Trump told CNN the tariffs on Chinese goods will “come down substantially,” a U-turn that Chinese policy-makers have likely anticipated, considering China’s strategic moves following Trump’s tariff announcement. Internationally, the EU has proactively approached Beijing to discuss scrapping electric-vehicle tariffs. In our exclusive interview with China’s top strategist Professor Wang Xiangsui, he pointed out one key aspect overlooked by most discussions of Trump’s economic blunder- that Trump’s miscalculation could present China with the perfect opportunity to solve the Taiwan problem.

First, Professor Wang believes that Trump’s failed tariff extortion has completely undermined the deterrent power of U.S. economic coersion:

Back in October 2024, Trump warned Beijing, “If you move on Taiwan, I’m sorry to do this, but I’m going to tax you at 150–200%.” The Associated Press predicted in November that such crushing levies would force China back to the negotiating table.

But today, Trump has already raised the tariffs on China to 245%—even harsher than his own threats—but China’s economy has weathered the storm—running smoothly and displaying a resilience that outclasses many Western peers. Any doubts within China about whether “200% tariffs” is a reasonable price for reunification have been laid to rest.

Moreover, on April 19 Britain’s Chancellor of the Exchequer Rachel Reeves told the Telegraph: “Well, China is the second biggest economy in the world, and it would be, I think, very foolish to not engage. That’s the approach of this government.”

Clearly, Trump’s tariff cudgel has not only failed to strike China but has even driven allies apart—hence why when Trump vowed “We are waiting for their call”, China confidently said, the US “can never expect that call from China.”

Second, Professor Wang believes that Trump’s tariffs targeting TSMC have discredited the popular narrative promoted by Taiwan separatists:

One of America’s most important geopolitical projects has been detaching Taiwan from China. To advance this goal, the U.S. worked to integrate TSMC into the global chip supply chain, rendering it an indispensable player in semiconductor manufacturing. This ensured that not only the U.S., but also its allies involved in the supply chain, would have aligned interests with Taiwan. Massive orders from U.S. tech giants helped transform that small island on China’s continental shelf into a giant in the semiconductor industry.

On the surface, it looked like the U.S. was “giving concessions” to Taipei, but in fact, it was binding Taiwan island’s biggest trade surplus generator to America’s most lucrative high-tech sector—using economic incentives to draw Taiwanese politicians onto the separatism bandwagon. However, the Trump administration lacked the political savvy to sustain this project.

On “Liberation Day” Trump imposed tariffs on Taiwan island only 2% lower than those on mainland China. Trump even publicly declared that TSMC would pay a tax of up to 100% if it did not build its plants in the US.

With TSMC contributing 15% of GDP and 60,000 jobs for Taiwan island, Trump’s blunt threats has pushed Taiwanese workers further away from Washington’s orbit, and discredited the pro-U.S. separatist narratives.

While Trump’s tariffs shatter America’s tradition of controlling Taiwan through economic means, Trump’s military moves have only hastened China’s reunification.

A Reuters report in 2024 noted that when asked if he would use military force against a blockade on Taiwan by Beijing, Trump clearly said he would not. Yet on March 29 2025, the Washington Post revealed an “Interim National Defense Strategic Guidance” in which Secretary of Defense Pete Hegseth wrote, “China is the Department’s sole pacing threat, and denial of a Chinese fait accompli seizure of Taiwan — while simultaneously defending the U.S. homeland is the Department’s sole pacing scenario.”

Professor Wang emphasizes that China has never bet its hopes for reunification on American promises. Trump’s mixed messages reveal either a feeble bluff or a dangerous schism between the presidency and the Pentagon. In fact, Professor Wang sees China’s reunification already underway when the Pentagon continues wargaming Taiwan’s “occupation”. Every time a U.S. politician makes reckless remarks or sells arms to Taiwan, mainland China is simply presented with another opportunity to accelerate the process. Didn’t Nancy Pelosi help the Chinese Navy cross the so-called median line of the Taiwan Strait in 2022? Taiwanese politicians have also actively contributed to the process. On April 2 of this year, Lai Ching-te declared that China and Taiwan are “not subordinated to each other,” prompting the Chinese military to launch its “Strait Thunder 2025A” . The nature of the drill was particularly highlighted by Professor Wang: It’s a joint exercise between the navy and marine police, suggesting more regular activities of greater complexity in waters previously “claimed” by Taipei. During the drill, the nearby USS Carl Vinson carrier strike group quickly and quietly departed for the Middle East.

Unless U.S. policymakers elevate their strategic acumen soon, they may drag the U.S. into a scenario no amount of wargaming can predict—a full-on rivalry with a unified China.

Editor: Charriot Zhai