Thu, Nov 30, 2006 - Page 12 News List

US, Taiwan differ on free trade pact


The differences between Taipei and Washington over a US-Taiwan free trade agreement (FTA) came into sharp focus on Tuesday as officials from both sides disagreed over whether Taiwan should pursue cross-strait economic links before the US considers an FTA.

Hu Sheng-cheng (胡勝正), the chairman of the Council for Economic Planning and Development, argued before a luncheon of the US-Taiwan Business Council that an FTA should precede cross-strait links because the trade agreement would smooth the way for better economic relations with China and make Taiwan more confident when talking to Beijing about improved economic relations.

Thomas Christensen, the Deputy Assistant Secretary of State in charge of China and Taiwan affairs, however, defended comments made last week by American Institute in Taiwan, Director Stephen Young that direct links must come first.

In a speech made to members of the American Chamber of Commerce in Taipei on Nov. 21, Young encouraged Taiwan to negotiate with China to open the three links, especially direct flights, as soon as possible.

The Taiwanese government is willing to talk with Beijing about direct links, Hu said in a speech to the association's annual board of directors' luncheon, but "a US-Taiwan FTA would promote faster economic growth on both sides of the Taiwan Strait."

That, in turn, "we hope would encourage China to engage with us in order to make cross-strait commerce easier and more efficient for all concerned," he added.

Afterwards, speaking to reporters, Hu said that "in order for both sides to negotiate [direct links], we need somebody to help push an FTA between the US and Taiwan." An FTA, he said, would help facilitate the "three links" between Taipei and Beijing and would "help a lot in cross-strait negotiations."

In speaking to Taiwanese reporters before the luncheon, however, Christensen argued for direct links.

"That is our position and we think that increased economic contact between Taiwan and the mainland is good for everybody," he said.

"We've encouraged Taiwan to open up more robust and direct contacts on the economic front. We think that that will be a future source of strength for Taiwan," he said.

Christensen defended Young's statements, noting that they echoed earlier statements by deputy US Trade Representative Karan Bhatia and other US government officials.

"So, I think that is a fair position, it is a widely held position in the US government," Christensen said.

Hu said he hoped that Taiwan could get an FTA even without TPA.

TPA refers to the Trade Promotion Authority, a US law that allowed the president to negotiate trade pacts subject only to a single up-or-down vote by Congress. The law, which has led to a host of US FTA's with other countries, expires on June 30, and most opinion in Washington is that the law will not be extended.

"In the past, FTA's were negotiated by the US without TPA," Hu told the Taipei Times. "So TPA would help, but without the TPA, it is not necessarily a handicap if both sides are willing to talk."

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