Taiwan's representative to Malaysia expressed worry yesterday about the recent signing of a free trade agreement (FTA) between China and the Association of Southeast Asian Nations (ASEAN).
Wu Wen-ya (
China and ASEAN signed the FTA last week in Laos, with the aim of creating the world's largest free trade area -- a sprawling market of 1.8 billion people -- by 2010.
Under the terms of the agreement, the two sides have set a timetable for lowering tariffs from next July, with tariffs on 7,000 items to be cut to between zero and 0.5 percent by 2010.
Trade between China and ASEAN is expected to break through US$100 billion this year, approximately three times the amount of trade between Taiwan and ASEAN last year.
Wu noted that bilateral trade between China and Malaysia has far surpassed that between Taiwan and Malaysia, and the completion of the FTA will inevitably squeeze Taiwan.
He noted that exchanges between Malaysia and China have been brisk and that Malaysia has great expectations for the vast Chinese market.
Two-way trade between Taiwan and Malaysia last year amounted to just US$7.8 billion, compared with China-Malaysia trade at US$20.1 billion.
Wu said that the government is currently conducting a feasibility study on signing an FTA with Malaysia, but he admitted that progress has been limited in light of the ASEAN developments.