A review by the Taiwan Competitiveness Forum says Taiwan and China should sign a memorandum of understanding (MOU) and launch a currency statement system, the Presidential Office said yesterday.
The report said an MOU and economic cooperation pact with China would enhance Taiwan’s internationalization and competitiveness.
The review, carried out in March, was sponsored by the Presidential Office and the report has been published on the office’s Web site. While it backs the government’s policy to reach an economic cooperation framework agreement (ECFA) with China, researchers said the report did not simply adopt the government’s position, but was based on independent research.
Whether the government should sign such a pact with China has been the subject of heated debate in Taiwan.
The government says an ECFA is necessary to ensure Taiwan enjoys tariff-free or lower-tariff access and other trade benefits while doing business with China, and to prevent Taiwan from losing out to other countries that have free-trade agreements with Beijing.
The Democratic Progressive Party and other opponents, however, say cross-strait negotiations lack transparency and they have warned that Taiwan’s sovereignty would be harmed.
The report also said a currency statement system between the two sides of the Taiwan Strait was necessary in response to the surge in demand for currency exchange between NT dollars and the yuan.
At present, currency exchanges between Taiwan and China have to go through banks in Hong Kong, which raises the fees, the report said.
Jeff Lin (林建甫), director of the forum’s report and an economics professor at National Taiwan University, urged the central banks of the two sides to cooperate on a currency exchange system and to help each other in light of the economic slump.
Meanwhile, the Financial Supervisory Commission said there was no timetable for signing an MOU with Beijing and the government would continue to work on this issue without sacrificing Taiwan’s sovereignty.
Current money exchanges between Taiwan and China have to go through banks in Hong Kong, which raises the fees, the report stated.