Taiwan and Singapore have begun talks on a free-trade agreement (FTA) that they plan to sign within one year, economic officials said.
Last August, Singapore announced its intention to sign an FTA with Taiwan, becoming the first country to do so after Taiwan and China signed the Economic Cooperation Framework Agreement (ECFA) in June.
The government of Taiwan believes the ECFA will pave the way for similar deals with other countries as China is not likely to obstruct such efforts.
Apart from Singapore, the Philippines and India have also taken steps toward initiating free-trade talks with Taiwan.
“Taiwan and Singapore have indeed launched negotiations on an economic partnership and there has been considerable progress,” Minister of Economic Affairs Shih Yen-shiang (施顏祥) said.
However, he did not say when exactly a conclusion could be expected on the FTA, which is being called the Agreement between Singapore and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu on Economic Partnership (ASTEP).
“Taiwan and Singapore have agreed not to say too much before a consensus is reached,” he added.
However, economic officials who spoke on condition of anonymity said the ministry aims to step up the talks to conclude the deal within a year.
The Taiwan-Singapore talks are focusing on tariffs, opening up the service sector and economic partnerships, the officials said.
Through the FTA with Singapore, Taiwan hopes to enter the agricultural markets in ASEAN countries, but the two sides may encounter obstacles in their talks because Singapore has virtually no agricultural sector, the officials said.
However, Taiwan will not benefit much from tariff reductions because Singapore already has zero tariffs on the import of most industrial goods, the officials said.
Taiwan is focusing mainly on the opening of Singapore’s financial sector, which has many restrictions on foreign financial service providers, they added.