Fri, Oct 20, 2006 - Page 11 News List

MOEA upbeat on US FTA

TRADE OBJECTIVES With less than a year left to US President Bush's Trade Promotion Authority, Taiwan was pressing for trade agreements with other states


Minister of Economic Affairs Steve Chen (陳瑞隆) said yesterday he thinks there is hope that Taiwan and the US will sign a free trade agreement (FTA), adding that it was impossible at this point, however, to predict when this could occur.

Fielding questions at the legislature's Foreign Affairs and Overseas Chinese Committee, Chen said the Ministry of Economic Affairs (MOEA) has endeavored to initiate FTA talks with major economies around the world, including the US, Japan and ASEAN, as well as with countries maintaining formal diplomatic relations with Taiwan.

Chen said Taiwan completed bilateral talks with Nicaragua and signed a FTA agreement in June, which is expected to take effect next year.

Nicaragua represents the third country to forge an FTA agreement with Taiwan after Guatemala and Panama.

FTA talks have also been underway with El Salvador and Honduras, and the bilateral talks are expected to conclude by the end of this year, paving the way for Taiwan to sign FTA agreements with these Central American countries, Chen said.

Chinese Nationalist Party (KMT) Legislator Lee Jih-chu (李紀珠), however, said that the ministry should spend more of its time and energy pursuing FTA agreements with countries and groupings that have greater economic clout -- such as the new ASEAN Plus Three group -- rather than on small countries like Nicaragua, whose two-way trade with Taiwan she claimed "translates into nearly zero economic benefit for Taiwan."

On relations with the ASEAN Plus Three group, Chen said his ministry has spared no efforts to bolster exchanges with member countries.

For example, he said, Taiwan signed an agreement with the Philippines last year on the development of an "economic corridor" -- stretching from Subic Bay to Clark Air Base -- from which location Taiwanese manufacturing companies will be able to export their products to other ASEAN countries.

Taiwanese investors have maintained a very good status in Thailand, Vietnam and Malaysia, where Taiwan ranks as the third largest source of foreign capital, Chen noted.

Lee said if Taiwan cannot effectively explore its bilateral relations with important trade blocks like ASEAN and the US -- which absorb 62 percent and 18 percent, respectively, of Taiwan's total exports -- Taiwan risks being marginalized on the global economic stage.

On the prospects of Taiwan signing an FTA agreement with the US, Lee said she is not as optimistic as Chen, stating that the window is closing fast for substantive consideration of the issue under US President George W. Bush administration's Trade Promotion Authority, which will expire on July 1 next year.

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