Taiwan must continue to make progress under the Trade and Investment Framework Agreement (TIFA) process in order to sign a free-trade agreement (FTA) with the US in future, US Senator John Rockefeller IV said yesterday in Taipei.
Rockefeller made the remark when addressing a breakfast meeting on the benefits of a US-Taiwan FTA. The meeting was hosted by the Chung Hua Institution for Economic Research (
A US-Taiwan FTA would bring economic benefits for both countries, Rockefeller said, citing a study conducted by the institute, which indicates that such an agreement would boost Taiwan's GDP by more than 0.5 percent and expand overall trade and investment in the Taiwanese economy by US$26 billion.
Citing another study by the US International Trade Commission, Rockefeller said that under the FTA, US exports to Taiwan would increase by US$3.5 billion, or 16 percent of current annual volume.
"I encourage the leaders of Taiwan to continue to make changes necessary to make the TIFA process work," said Rockefeller, who has promoted a US-Taiwan FTA for many years.
Taiwan and the US resumed TIFA talks last November.
Reducing trade barriers on telecommunications services, pharmaceuticals, financial services, electronic commerce and various agricultural products are important agenda items for the government as required by TIFA, said Rockefeller, who is also the honorary co-chairman of the US-Taiwan Business Council in Arlington, Virginia, as well as a founding member of the Senate Taiwan Caucus.
Protection of intellectual property rights (IPR) has enormous weight for the US government when considering the signing of an FTA, he said.
Taiwan's considerable efforts to improve its IPR protection got it removed from the US Trade Representative's "Priority Watch List" to less severe "Watch List" of IPR violators under the US' Special 301 Law in January, but additional steps need to be taken to strengthen Taiwan's legal and regulatory framework to ensure the highest degree of protection for IPR, Rockefeller said.
He said he believed that a US-Taiwan FTA would help integrate Taiwan into the global economy without creating tensions across the Taiwan Strait.
"I am hopeful that, as the United States and Taiwan consider an FTA, the mainland leaders will recognize that the more Taiwan is able to freely trade with the countries of Asia, the more this will be to the benefit of the PRC," he said.
Rockefeller said trade liberalization in Asia in recent years is a positive trend, but it is one that should also include Taiwan.
"Taiwan deserves the opportunity provided to others to trade freely," he said.
Taiwan has been keen to sign FTAs with major trading partners such as Japan and Singapore, but these efforts have been blocked by China.
A US-Taiwan FTA might make China more willing to oppose others who want to sign FTAs with Taiwan, said Douglas Hung (
Although promising to urge the Bush administration to work more closely with Taiwan in regard to this issue, Rockefeller said it was too early to set a timetable for a FTA with Taiwan, given the number of other FTA proposals piled up in the US Congress.
Given the US' large trade and budget deficits, the US government is also becoming more cautious on whether such free-trade deals would create unfair competition for US industries, Rockefeller said.