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Exclusion requests hinder Taiwan at WTO

"But Taiwan in principle is going in exactly the opposite direction."

Israeli trade official

Conditions sought by Taiwan to limit certain countries from participation in government procurement contracts are holding up its accession to the WTO's Government Procurement Agreement (GPA), according to foreign trade officials.

Taiwan had been set to sign the agreement in February, but was held up when Singapore and Israel objected claiming they weren't satisfied with the conditions in Taiwan's accession documents and requested bilateral talks on the matter.

In a statement sent to the Taipei Times, the Singapore government accused Taiwan of "blatant discrimination" for excluding it from concessions offered in its application bid to other members of the GPA, which seeks transparency and fair play in the awarding of procurement contracts.

Taiwan seeks to exclude Singaporean firms from bidding on contracts to supply goods and services, including electrical machinery, rail transport equipment and services related to electricity and construction services, the statement said.

While Singapore is denied, other signatories of the 28-member GPA including the US, EU, Japan, Korea, Hong Kong and Switzerland are extended these rights, the statement said.

Israel took a softer line, with a senior trade official in Jerusalem telling the Taipei Times by phone that it had refused to endorse Taiwan's accession due to its inflexibility over the awarding of reciprocal bidding rights in various government procurement areas.

Israel is seeking a more balanced approach where access in certain areas will be reciprocated by Taiwan, but not necessarily in the same area.

"But Taiwan in principle is going in exactly the opposite direction," said the official, adding that Taiwan wants access in certain areas of its own market to be rewarded in exactly the same areas by Israel.

Taiwan, however, yesterday refuted the claims of discrimination, saying that Singapore and Israel had not taken seriously enough the country's commitment to sign the GPA and had raised their objections far too late.

"It's their responsibility to request bilateral discussions and they have left it until too late," said said one senior trade official, who requested anonymity. He added that because of the delay, other members are now reexamining Taiwan's accession commitments and seeking adjustments.

Indeed, according to the Singapore official, Japan and the EU are now raising concerns about procurement conditions set for state-run Chunghwa Telecom Co (中華電信).

The GPA establishes an agreed framework to make procurement laws, regulations, procedures and practices transparent, helping to ensure that signatories do not unfairly favor domestic products or suppliers or discriminate against foreign competitors.

The government is expecting the increased access to government procurement projects in other countries will be worth US$200 billion to local companies, while also offering billions to foreign firms who vye for Taiwan's procurement contracts.

Unable to make any headway on their concerns, Singapore continues to withold its endorsement of Taiwan's entry into the GPA -- entry into which requires unanimous support of members -- and urges a "positive response from [Taiwan] in addressing the concerns ," the statement said.

Additionally, despite media speculation to the contrary, Singapore denied acting to block Taiwan's signing of the agreement due to pressure from China.

Bilateral discussions between Taiwan, Singapore and Israel are ongoing and while the local official are positive that the matter could be resolved by October, another issue now threatens to push back that deadline.

The local official confirmed previous remarks by Minister of Economic Affairs Lin Yi-fu (林義夫) that China, which is an observer of the agreement, had also made efforts to stall the nation's push to become a signatory.
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