Taiwan's benchmark stock index plummeted nearly 10 per cent on Monday, marking its biggest one-day drop on record, after the announcement of a 32 per cent US tariff on Taiwanese imports. This sharp sell-off occurred as markets reopened following a two-day holiday, with major exporters like TSMC and Foxconn hitting the 10 per cent limit-down threshold. The tariffs, part of US President Donald Trump's broader trade crackdown, target countries with significant trade surpluses with the United States. While semiconductors were excluded, Taiwan's export-driven economy remains highly vulnerable due to its central role in the global electronics supply chain. In response to the tariffs, Taiwan introduced a T$88 billion ($2.65 billion) support package for affected businesses. President Lai Ching-te promised to increase US imports and pursue a zero-tariff agreement, aiming for a "golden age" of shared prosperity with the US. He also ruled out any retaliatory tariffs. Taiwanese authorities acted quickly to stabilise the market by imposing short-selling restrictions for the week. Taiwan Stock Exchange Chairman Sherman Lin noted that further measures could be implemented if necessary. Analysts cautioned that investor panic and uncertainty surrounding trade policy could push Taiwan towards recession. Goldman Sachs downgraded Taiwan to "underweight" in its Asian portfolio, citing Taiwan's high exposure to US trade. Attribution: Reuters Subediting: M. S. Salama
