Tsai outlines cargo-links benefits

The implementation of Shanghai-bound chartered cargo flights is expected to save NT$15 billion and contribute between 0.01 and 0.04 percent to Taiwan's GDP growth in the first year, Mainland Affairs Council Chairwoman Tsai Ing-wen (蔡英文) said yesterday.

"The short-term benefits will be limited," Tsai told a joint luncheon held by six major business groups, "but in the long run, the links will add to Taiwan's GDP growth by between 0.4 and 1.19 percent, stren-gthening the nation's economic importance and strategic competitiveness in the region."

The planned cargo flights, which are slated to begin on Thrusday, will usher in the implementation of direct links and trade exchanges between Taiwan and China on a large scale pending the resumption of cross-strait negotiations, Tsai added.

According to the council's estimates, the links will allow China-based Taiwanese businesses to take advantage of China's manufacturing base while enabling them to expand their share of regional markets.

The cargo flights plan will also bring immediate advantages to the nation's petrochemical, textile, information technology and transportation sectors while negatively impacting the local agricultural sector and makers of auto parts and electronic appliances, Tsai said.

The proposed cross-strait cargo flights plan also has its downside, she said. The biggest risk is that Taiwan's economy may be marginalized if the nation cannot transform its manufacture-oriented economy to a service-based one, she said.

Citing reports conducted by several private think tanks, Tsai said that once transport links are established, China-bound capital flight may increase by US$60 billion per year, resulting in 50,000 to 80,000 lost jobs.

Moreover, the number of western-bound travelers may also double, generating hundreds of billions of dollars in revenue for China, Tsai added.

"The trade imbalance across the Strait will be addressed to prevent Taiwan from overly depending on China," Tsai said.

Before conducting a closed-door meeting with yesterday's participants, Tsai concluded her speech by blaming China for using the "one-China" principle to politicize the links' implementation.

She urged China to extend its goodwill and show flexibility by resuming cross-strait negotiations to facilitate direct links.

Gary Wang (王令麟), chairman of the General Chamber of Commerce (GCC, 商總), told reporters after the closed-door meeting with Tsai that "we [businesses] look forward to the immediate resumption of negotiations to speed up direct links."

In addition to the transportation links, Wang also urged the government to address the inconvenience triggered by a lack of cross-strait financial exchange as well as direct air links for passengers.

In response to concerns raised by Taiwanese businesspeople, Tsai said that the Ministry of Finance and the central bank were working on plans to allow the remittance of capital across the Strait.

She added that the government won't implement links hastily, since the issue involves a legion of commercial interests for air carriers.

But the cargo plan will provide flights of convenience for China-based Taiwanese businesses to ship their deliveries on time during the next busiest quarter.