Taiwan's policies on trade and economic development in China have changed significantly since the Economic Development Advisory Conference (EDAC, 經發會) came up with its four fundamental principles: Taiwan first, a global perspective, mutual benefit and win-win solutions, and sound risk management -- and formulated the "active opening, effective management" policy.
On Nov. 23 last year, the government lifted its ban on investments in China in the production of 122 items, including high-end laptop PCs, 3G mobile phones and CD-ROMs. On Nov. 30, the ban on another 1,004 items was lifted. In December, manufacturers of 52 state-of-the-art products, such as light-emitting diodes (LEDs), as well as 636 categories of petrochemical, medical and chemical products, were allowed to invest in China.
But this extensive liberalization did not satiate the voracious appetite of businesspeople to "go west." Whether silicon-wafer fabs should be allowed to migrate across the Taiwan Strait is again the topic of a fevered debate.
I am not opposed to enhancing cross-strait trade and economic relations, but I fear that while we relentlessly pursue "active opening," the other half of the equation, "effective management," has yet to manifest itself. The scholars and officials advocating more liberalization have never mentioned the EDAC consensus on "Taiwan first" and "sound risk management."
What is particularly disturbing is that liberalization advocates criticize those calling for effective management for "fanning the flames of confrontation," "fettering and damaging the nation" and "leading Taiwan toward a political impasse." Some even say the issue highlights Taiwan's need for rational debate.
Secretary-General to the Presi-dent Chen Shih-meng (陳師孟) said that all political parties need more opportunities to reflect on the issue. Unfortunately, his unbiased viewpoint was attacked by the "go west" crowd. He was pushed so hard that he had to qualify his stance by saying, "[It's] only a suggestion and does not mean a public hearing will be held over the issue of eight-inch wafer fabs."
The fact that a request for a public hearing failed to evoke a rational response proves that the capacity for rational debate has indeed been lost. It also reveals the root cause of that loss.
Technicians and executives in Taiwan's industrial parks oppose moving wafer plants to China, but they don't speak because they are worried about their jobs. The heads of companies that supply the wafer industry also believe there is no pressing need to move eight-inch wafer fabs to China. But they keep silent lest they irk Beijing and affect their business opportunities in China. Some research and academic organizations are staying silent to avoid offending their sources of fund-ing. This is proof that Taiwan, pressured by the Chinese market and Beijing's policies, has completely lost the capacity for rational debate. As a result, the consensus on cross-strait economic issues has gradually tilted toward active opening, without any mechanism for effective management being established.
The silicon-wafer industry is the only industry in which Taiwan has excelled on a worldwide scale in recent years. It is also the pillar supporting Taiwan's economy. Whether to allow investments in eight-inch wafer fabs in China, how to implement such a liberalization and what conditions should be enforced are central to the questions of whether or not Taiwan's industries are destined to be hollowed out and whether the nation's economic growth can be sustained.