Wed, Jul 17, 2013 - Page 13 News List

Service trade pact ‘may be threat to national security’

ACADEMIC INPUT:Some academics said the pact did not create a level playing field for local companies and its impact would be far more than merely on figures

By Helen Ku  /  Staff reporter

Taiwan’s national security might be threatened by Chinese investors’ political propaganda, censorship or privacy infringement once the cross-strait service trade agreement takes effect, academics said yesterday, urging the government to renegotiate the pact with China to safeguard the nation’s interests, as well as local service providers’ rights and benefits.

“No one country should put commercial interests ahead of broader national interests when negotiating any trade agreement with others,” National Taiwan University economics department chairwoman Jang Show-ling (鄭秀玲) said at a forum in Taipei.

Jang said the market opening between the two countries is “asymmetrical,” because the pact does not create a level playing field for Taiwanese companies.

While the publishing sector is not included in the latest market liberalization, Chinese investors could seek other channels to sell politically sensitive publications to Taiwanese, she said.

The government’s decision to open the domestic telecommunication and mail and parcel delivery markets to Chinese investors has also raised concerns for national security and individual privacy, Jang said.

Moreover, the government has underestimated the impact of opening up these service sectors on Taiwan’s small and medium-sized businesses.

“There is a likelihood that Taiwanese small and medium-sized enterprises can [be forced to] merge with or get acquired by their larger Chinese counterparts, as part of China’s political or economic strategy,” Jang said.

Echoing Jang’s view, National Taiwan University economics professor Kenneth Lin (林向愷) said both the Ministry of Economic Affairs and the Chung-Hua Institution for Economic Research are too optimistic about the economic contribution to be made by the trade pact.

On Monday, the government said the trade pact is expected to raise Taiwan’s GDP by between 0.025 and 0.034 percentage points a year. It is also forecast to create up to 11,923 jobs, which would see employment rise by between 0.15 and 0.16 percent.

“Their evaluations are too positive to be true,” Lin said.

Lin said the government’s impact assessment reports only considered the reduction of tariffs and its contribution to the nation’s GDP growth, but failed to take into account the “quality” of services, which makes it difficult for the pact’s impacts to be represented in numerical terms.

“In real life, the service trade agreement’s impacts are far more than figures, which explains why the government still doesn’t understand the public’s concern,” he added.

Meanwhile, Lee Chien-hung (李健鴻), an associate professor in Chinese Culture University’s department of labor relations, said that the government should legalize compensation rules for affected companies. He added that the US had implemented its Trade and Globalization Adjustment Assistance Act in 2009 and that Taiwan should look up to the US to help small businesses overcome bankruptcy and similar issues.

According to the Ministry of Economic Affairs, the government in 2010 budgeted NT$95.2 billion for rescue funds to assist local firms who might suffer from economic losses under the cross-strait Economic Cooperation Framework Agreement.

However, the ministry also requires affected companies wanting to obtain aid from the government to go through a series of government assessments.

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