Bureau outlines plans to counter trade headwinds

GLOBAL SUPPORT::The foreign trade bureau said it would continue attempting to meet the standards for the CPTPP, which would benefit the textile and auto industries

By Ted Chen  /  Staff reporter

Wed, Jan 30, 2019 - Page 12

The Bureau of Foreign Trade yesterday outlined its plans to weather expected headwinds in foreign trade after the nation’s exports began to decline in November last year.

While the nation’s exports last year rose 5.93 percent annually to US$336.05 billion, November and last month saw monthly declines of 2.1 percent and 3.1 percent respectively, the bureau said.

Meanwhile, a 10.6 percent increase in imports lowered the nation’s annual trade surplus by US$8.59 billion, it added.

The slump was caused by weaker-than-expected demand for high-end smartphones and machinery, as well as falling basic metal prices, the bureau said, adding that capacity expansions in China also hampered Taiwan’s optoelectronic exports.

Apart from the US-China trade dispute, protectionism is increasing across the globe, with major economies imposing tariffs and import quotas on more than US$588 billion of goods, Bureau of Foreign Trade Director-General Yang Jen-ni (楊珍妮) told a news conference in Taipei.

“Obviously, the world is going back to the managed trade system, as we have seen an annual increase of 63 percent in the number of trade policy tools implemented by governments,” Yang said.

The EU has imposed quotas on Taiwanese steel exports, she said, adding that tracking export shipments has become increasingly difficult in today’s globally intertwined supply chains.

“The US-China trade dispute goes beyond rectifying mere trade deficits, but is an effort to address a number of unfair competitive practices, particularly in the technology sector,” Yang said.

In light of the gloomy outlook, the bureau said it would continue its efforts to seek support from members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and meet the standards for accession to the trade bloc.

Taiwan’s inclusion in the Japan-led trade bloc is expected to benefit local textile, machinery and auto parts makers, Bureau of Foreign Trade Deputy Director-General William Liu (劉威廉) said, adding that the CPTPP aims to establish a tariff-free supply chain among its member states.

Although bigger Taiwanese textile firms can expand their footprint in Vietnam — a popular investment destination for the industry — to enjoy free trade among member states, smaller firms would be pressured by lower prices from rivals, Liu said.

According to CPTPP rules, products must be wholly manufactured in a member state, which means that Taiwanese companies would benefit from producing raw materials, such as yarn, in Vietnam, Liu said.

The bureau would also continue to pursue talks at the WTO and APEC to ease trade barriers, and deepen ties with nations targeted by the government’s New Southbound Policy.