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Free-trade ports best option: Ho

The "free-trade port" mechanism is the best the government can do at this point to ease transport restrictions before the advent of direct links, a government official told the foreign business community yesterday.

"I know local and foreign business groups are not that satisfied with the current measure, but this is better than nothing," said Ho Mei-yueh (何美玥), vice chairwoman of the Council for Economic Planning and Development.

"However, we're willing to modify it to cater to their needs," she said.

Ho has been pushing "free trade port" initiatives since she took up the council post in 2000. She made the remarks yesterday after a luncheon with members of the European Chamber of Commerce Taipei (ECCT).

The free ports are within the nation's territory but outside the jurisdiction of Republic of China (ROC) Customs. For businesspeople, this bypass means having a single window for administration and a fairly free flow of goods within the ports, Ho said.

Imported goods, including those from China, are duty free and do not need to be checked by customs in the zone, she added.

The Cabinet last month granted free-trade-port status to Keelung Harbor and Kaohsiung Port. Keelung's free-trade port is expected to start operations in September while Kaohsiung will begin next January.

The third free-trade port may be the Taoyuan air-cargo zone next to the Chiang Kai-shek International Airport. Ho said the zone will file an application in June or July.

Taichung and Hualien are also possible candidates.

The council estimated that the free-port project is expected to increase the average annual value of the nation's exports by NT$120 billion by 2008, while imports are expected to grow by NT$88 billion per year during the same period.

However, many logistics operators say progress toward free-trade ports has been too slow. They have suggested the whole country should be turned into a free-trade zone like Hong Kong and Singapore, said Jeroen Rozendal, co-chair of the ECCT's logistics committee.

The 53-year-old chairwoman -- who has been touted as a possible candidate for minister of economic affairs in the next Cabinet reshuffle -- said that Taiwan still has an edge when it comes to attracting foreign investment.

Unlike most free-trade ports in other countries that only act as transshipment sites, Taiwan's free ports also serve as processing and financial centers, she said.

Guy Wittich, chief executive officer of the ECCT, said he saw substantial progress in the free-trade port project compared to a year ago.

But Wittich reiterated that a desire for direct cross-strait transportation still tops the agenda of the foreign business community in Taiwan.

"If you go to headquarters in Paris or London and want them to move their regional logistics or warehousing centers from Hong Kong or [South] Korea to Taiwan, you still have to convince them that the lack of direct links is not an issue," he said.
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