Business leaders across sectors yesterday pressed President Ma Ying-jeou (馬英九) to strengthen trade ties with China in his second term, saying its huge population supplies cheap labor for Taiwanese electronics firms and an increasing source of tourism revenue.
Taiwan is the world’s largest contract computer chip manufacturer, as well as a leading designer and manufacturer of LCD panels, networking equipment and other consumer electronics products.
Most Taiwanese companies have their manufacturing facilities in China and ship their products to the West for sale.
“The Ma administration may bask in its triumph for a day or two and start to get down to business given the economic challenges at home and abroad,” said Preston Chen (陳武雄), chairman of Chinese National Federation of Industries (全國工業總會), which represents more than 150 industries in Taiwan.
Foreign and local research institutes have trimmed forecasts for the nation’s GDP growth this year to a range of 2 to 4 percent, from 4.4 percent last year, as consumers in debt-ridden US and Europe are likely to avoid aggressive spending.
Chen said the government should seek first to secure an investment protection agreement with China after cross-strait trade talks last year failed to bear fruit.
“Such a pact is critical for Taiwanese firms in China both to protect their investments and to reduce trade disputes,” he said.
Taiwanese investment in China, direct and via a third place, totaled US$2.6 billion in 2010, rising 23.8 percent from a year earlier at US$2.1 billion, according to data compiled by the Ministry of Economic Affairs.
Yao Ta-kuang (姚大光), chairman of the Travel Association of ROC, Taiwan (中華民國旅行商業同業公會全國聯合會), said Ma’s re-election showed his cross-strait policy paid off and the president should be more proactive in this area in the coming four years.
Tourists made 6.09 million visits to Taiwan last year, with Chinese accounting for 29 percent, or 1.73 million visits, Yao said, citing government data.
“The figures suggest ample room for improvement, as Hong Kong and Singapore drew many more tourists from China despite their smaller geography,” he said.
On the campaign trail, Ma pledged to increase the overall number of tourists by 1 million a year in a continued bid to prop up tourism and related sectors.
The past four years have seen an increase of 30,000 hotel rooms with another 40,000 to be added in the next three years, driven by expectations of an influx of Chinese tourists, Yao said.
That would provide more job opportunities to a workforce that already numbers 700,000 in the hospitality, transportation and retail sectors, Yao said.
“The government must go ahead and remove legal barriers so more Chinese can visit Taiwan and in an easier fashion,” Yao said.
Wang Ying-chieh (王應傑), a senior executive at the General Chamber of Commerce (商業總會), said the Ma administration should expand the Economic Cooperation Framework Agreement (ECFA) so more China-bound goods could enjoy lower tariffs.
Favorable taxation terms are important for Taiwan exporters to maintain their competitiveness internationally, especially against peers in South Korea and Southeast Asian countries, Wang said.
Wang also suggested that the government pursue trade enhancement agreements with Singapore, New Zealand and other nations to help Taiwanese firms diversify investment risks.