On Aug. 11, President Donald Trump postponed the introduction of extensive tariffs on China once more, granting a 90-day extension just before the previous agreement between the world’s two largest economies was set to expire.
After an initial tariff war, the great powers are now trying to make a trade deal happen. What does that mean for Taiwan?
For Trump, allies are partners only as far as they deliver returns. Adversaries are dangerous but also valuable, because they hold concessions that can be traded.
For Taiwan, this worldview is a serious risk. While Trump’s advisors are skeptical of China’s intentions and view the Chinese Communist Party as harmful to US interests, Trump himself maintains a different outlook. He is not a career politician, but a businessman who thinks that you have to deal with the big players to make the big deals. From his perspective, an accord with China would be the legacy-defining deal that cements his place in history.
If Chinese leader Xi Jinping presents Trump with a concrete demand — halt arms sales, reduce high-level contacts, or soften Washington’s language on Taiwan — the question in Trump’s mind may be: “What can I get in exchange?”
The Trump–Putin meeting: a signal for Taiwan
The Trump–Putin summit offered Beijing a valuable case study in how Trump approaches negotiations in high-stakes settings, and carried important signals for Taiwan.
The meeting demonstrated Trump’s willingness to sit down with adversaries and treat negotiations as opportunities for high-profile engagement, regardless of how those affect allies.
Concessions are not ruled out in Trump’s playbook — they are part of his bargaining method. What matters to him is not preserving alliance cohesion but securing outcomes he can present domestically as “wins.”
For Taipei, this pattern is worrying. The meeting underscores that Washington is prepared to make decisions that may disadvantage allies.
Such moves narrow the margin of maneuver for partners caught in the middle. Just as European allies were sidelined in Trump’s overtures to Moscow, Taiwan risks being blindsided if Trump decides that granting Beijing something on Taiwan could unlock concessions he values more.
For Taiwan, this precedent should be read as a warning that its security could become collateral in a broader negotiation with Xi Jinping.
China trade and Taiwan policy
In his first term, Trump occasionally used Taiwan as a bargaining chip in negotiations with Beijing, trying to use cross-strait issues to gain leverage. However, today’s China is not the same country it was during his first term — it is more prepared, assertive, and powerful.
Against this backdrop, two current dynamics heighten the risks for Taiwan in the context of a possible US–China trade deal.
First, Trump has made rebalancing trade his priority, subordinating other aspects of US–China relations. Export controls, human rights, and Taiwan are bargaining tools to secure a trade deal with Beijing.
Second, Taiwan’s internal political divisions complicate its standing with Washington. Party fragmentation, budgetary constraints, and slow progress on defense spending have already raised concerns, while trade imbalances add further tension.
Recent episodes illustrate how quickly Taiwan can be deprioritized. The Trump administration blocked President Lai Ching-te’s (賴清德) planned transit through New York, forcing Taipei to cancel his Latin America trip. According to the Financial Times, the move followed Chinese protests and was primarily motivated by ongoing US–China trade talks.
In the same context, Washington also canceled planned military discussions with Taiwan, with officials fearing that Defense Minister Wellington Koo’s (顧立雄) June visit could jeopardize negotiations with Beijing.
These decisions highlight that when Beijing raises objections over Taiwan, Trump does not automatically reject them on principle. Instead, he evaluates whether accommodating China could unlock gains in other areas. In this case, advancing trade negotiations was judged more valuable than maintaining political or military exchanges with Taipei.
For Taiwan, this is precisely the danger. If Xi presents specific demands, Trump may not dismiss them as unacceptable. Rather, he may treat them as bargaining chips to secure concessions that serve his domestic or economic agenda.
The canceled trip and military talks serve as early signals of how easily Taiwan’s interests can be subordinated to the pursuit of a “bigger deal” with Beijing.
Trump’s bargaining logic limits
Yet this logic collides with a hard reality — global overreliance on Taiwan’s semiconductor industry.
Taiwan Semiconductor Manufacturing Company alone controls more than two-thirds of the global semiconductor foundry market in 2025. Its chips power not only US consumer technology but also the defense systems Washington depends on. In parallel, Taiwan is embedding itself deeper into the artificial intelligence revolution, building what could become an “AI shield.” Each advance in chipmaking translates into leaps in AI capability, placing Taipei at the center of a competition that neither Washington nor Beijing can afford to sideline.
Washington may talk about “de-risking” supply chains and reducing overdependence on Taiwan, but Taipei’s technological lead is not about to be overtaken. This dependence restricts Trump’s freedom to bargain Taiwan away because it would undermine the technological base of US economic competitiveness and national security. The more semiconductors and AI are intertwined, the higher the costs of coercion.
Trump may view Taiwan as negotiable, but in practice, its position is far harder to trade. Taipei’s strategic leverage lies in ensuring that Washington understands this: bargaining Taiwan away is not just a political concession — it would mean sacrificing the technological foundations the US cannot afford to lose.
Taiwan in the shadows
In the lead-up to a potential fall summit between Trump and Xi, Washington’s conciliatory stance illustrates how quickly Taiwan can be placed on the negotiating table, often without prior warning. Decisions taken in Washington to accommodate Beijing leave Taipei confronted with a fait accompli, narrowing its ability to respond.
Taiwan’s security and political space risk being eroded not through dramatic announcements but through incremental trade-offs.
China’s leverage compounds the danger. Its dominance in rare earth minerals, magnets, and critical supply chains gives Beijing tools to entice Trump into concessions over Taiwan. If framed as part of a wider economic package, even symbolic US steps could be exchanged for promises on trade or market access. The precedent would be devastating: Taiwan could be reduced to a bargaining chip and its interests subordinated to Trump’s pursuit of short-term gains.
Still, the structural weight of Taiwan’s technology sector complicates this scenario. Any attempt to downgrade support for Taipei would risk undermining American supply chains at the very moment Washington is competing with Beijing in high-tech leadership. In this sense, Taiwan’s technological role limits how far Trump can realistically go in trading it away.
At the same time, domestic US politics send mixed signals. Anti-China sentiment remains one of the few bipartisan issues in Washington, and Trump may exploit this mood by publicly raising Taiwan’s profile as a way of demonstrating toughness on Beijing. Yet such gestures are unlikely to translate into costly or irreversible commitments.
The Republican Party’s hawkish voices and Congress’s bipartisan rhetoric provide Taiwan with visibility, but they do not define the administration’s policy. Trump’s decisions are more likely to be guided by calculations of leverage, trade benefits, and regional influence than by any principled commitment to Taiwan’s democracy.
This leaves Taipei in a difficult position. To sustain dialogue with Washington, Taiwan may feel compelled to appease Trump — raising defense spending, highlighting its economic value, and demonstrating that it is paying its “fair share.”
But appeasement offers no guarantee against abrupt shifts. Trump’s mindset is not only transactional but also unpredictable. Discarding the possibility that a trade dispute could be reignited — or that Taiwan could be pushed to the center of bargaining — would be naïve.
Ultimately, Trump’s approach makes Taiwan more vulnerable. For Taipei, the challenge is to reduce that vulnerability by broadening partnerships with other countries, expanding to emerging markets, and ensuring Taiwan’s competitiveness.
But the central risk remains: as long as Trump sees every negotiation as a deal to be struck, Taiwan lives under the shadow of being treated as leverage in his pursuit of a legacy-defining accord with Xi Jinping.
