Taipei agreed to buy about $85 billion in U.S. energy, aircraft and equipment in exchange for 15% tariffs.

The United States and Taiwan have finalized a trade deal Reduce Taiwan export tariffs and boosting billions of dollars in spending on U.S. goods.

The deal announced Thursday lowers general tariffs on Taiwanese goods to 15% from 20%, the same level as Asian trading partners South Korea and Japan, in exchange for Taipei agreeing to buy about $85 billion in U.S. energy, aircraft and equipment.

According to the agreementThe Office of the U.S. Trade Envoy said in a statement that Taiwan will eliminate or reduce 99% of tariff barriers and provide preferential market access to a wide range of U.S. goods, including auto parts, chemicals, machinery, health products, dairy products and pork.

In turn, the U.S. will exempt a number of Taiwanese goods from tariffs, including chalk, castor oil, pineapples and ginseng.

Taiwan President Lai Ching-te said Taipei had received tariff exemptions for about 2,000 Taiwanese products, hailing the agreement as a “pivotal” moment for the self-ruled island’s economy.

Lai said that if various exemptions are taken into account, the agreement will bring the average tariff rate on Taiwanese goods to 12.3%.

“From the familiar phalaenopsis, tea leaves, bubble tea ingredients (tapioca starch) and coffee, to pineapple cakes, taro, pineapple and mango – these products that represent Taiwan will become more price competitive in the U.S. market,” Lai said in a statement on social media.

“Our goal is not only to sell Taiwan’s delicious food overseas, but also to ensure that Taiwanese brands truly enter the international market,” he said.

Lai did not mention Taiwan’s chip industry, which is a key driver of Taiwan’s economy and accounts for an estimated 20% of gross domestic product (GDP).

Due to strong demand for artificial intelligence chips, Taiwan’s exports will increase by 35% in 2025, reaching a record high of US$640.75 billion.

Thursday’s deal apparently did not include specific commitments from Taiwan to invest in the U.S. chip industry, despite an announcement last month by U.S. President Donald Trump’s administration. Taiwanese companies will invest US$250 billion Enter the industry.

A fact sheet released by the Office of the U.S. Trade Representative said the two sides “took note” of the January agreement, which included previous commitments from chip giant TSMC Invest $100 billion in the United States.

U.S. Trade Representative Jamieson Greer said Thursday’s agreement builds on the long-standing trade relationship between Taiwan and the United States and will “significantly enhance the resiliency of our supply chains, particularly in high-tech sectors.”

“President Trump’s leadership in the Asia-Pacific region continues to build prosperous trade relationships for the United States with important partners in Asia while furthering the economic and national security interests of the American people,” Greer said.

By 2025, nearly one-third of Taiwan’s exports will be sold to the United States, making Taiwan its largest market for the first time since 2000.