In the government document The National Security Strategy of the United States of America, which the eminent Yale historian John Lewis Gaddis called "the most sweeping shift in US grand strategy since the beginning of the Cold War," US President George W. Bush attributed the main reasons for the decisive victory of liberty over totalitarianism in the 20th century to "freedom, democracy and free enterprise." He further affirmed that the US would use its "position of unparalleled military strength and great economic and political influence" to actively work to "bring the hope of democracy, development, free markets and free trade to every corner of the world."
This grand strategy, which seeks to actively shape an environment in which freedoms can flourish, rather than passively "hoping for the best," takes on more urgency in the wake of Sept. 11 last year. The events of that day showed that weak states could pose as serious a threat to US national interests as strong states. As Robert Zoellick, the US Trade Representative, puts it: "While terrorism isn't caused by poverty ... there's no doubt that failed states, broken societies, extreme poverty, create the fertile ground in which the seeds of terrorism can grow." Zoellick thus justifies his aggressive pursuit of free-trade agreements (FTAs) with a lengthening list of nations, including Jordan, Israel, Chile, Singapore, Australia, Morocco, southern Africa and the entire Western Hemisphere, on national security grounds: "We have a very strong interest in having a pro-growth economic policy that complements our security agenda."
Clearly the US expects important strategic and political benefits from these FTAs, because the economic benefits are modest. The US-Singapore FTA, for example, is unlikely to have a major impact on the gigantic US economy given the amount of additional trade at stake and that Singapore is a city-state of 4 million people, the dynamic economy of which is already largely open. But, as experts point out, Washington is nonetheless aggressively pursuing bilateral and regional trade talks, "both to cement ties with strategically important nations and as part of its overall trade strategy."
Taiwan, a key US trading partner, is not on the administration's FTA list. This omission is perplexing. In April, President Chen Shui-bian (
On both economic and security grounds Taiwan is a better FTA candidate than many on the administration's list, and signing an FTA with Taiwan is in US national security interests.
Economically, Taiwan is the US' eighth largest trading partner. Its two-way trade with the US is 41 percent larger, and its US imports 12 percent higher, than those of Singapore. (Taiwan's US imports are comparable to those of China, which has a population 50 times larger.) Taiwan's population is 5.5 times, and its GDP (the world's 17th largest) 3.6 times, that of Singapore. The US International Trade Commission report to Congress, US-Taiwan FTA concludes that while both economies would experience small economy-wide effects from an FTA, certain US sectors -- motor vehicles, rice, fish and other foods, and service industries (especially financial services) -- stand to reap huge gains from the removal of trade barriers under an FTA.
"Taiwan, which imports over US$2 billion in US farm products annually, is America's fifth largest export market for agricultural goods and a bigger customer than China," says John Tkacik, a researcher at the DC-based Heritage Foundation. Strategically, the argument that FTAs can help cement relationships with key democratic allies makes eminent sense in the case of Taiwan.
Last year the Bush administration increased its commitment to helping Taiwan defend itself. An FTA with Taiwan would contribute to peace in the Taiwan Strait. Tkacik argues that a FTA with Taiwan would underscore for Beijing that it cannot assume that it can take military action against Taiwan without involving the US. It would also encourage Beijing to choose inducements and goodwill rather than military intimidation to resolve its differences with Taipei. To him, these effects alone warrant the administration's priority attention.
An FTA with the US would also confer an accolade on Taiwan's democracy, which, as US House of Representatives International Relations Committee Chairman Henry Hyde puts it, serves as a beacon for Chinese democracy and is in keeping with US security interests. The administration's hesitation seems to be influenced by Beijing's objections. China's trade minister warned in June, "Countries signing free-trade pacts with Taiwan are bound to bring political trouble on themselves." Yet China, which entered the WTO only this year and is no model for free trade, recently signed an FTA with ASEAN.
The US should politely but firmly reject China's double standard. The rules of the 144-member WTO allow regional and bilateral trade agreements. Taiwan and the US, both WTO members, are thus entitled to a mutually beneficial FTA between them. If China can rush into FTAs aimed at securing its economic dominance in East Asia, why can't the US use FTAs to solidify ties with its friends and allies in the region? The US should pursue an FTA with Taiwan in its own national security interests.
Vincent Wang is associate professor of political science at the University of Richmond, Virginia. This article first appeared in the Taipei Journal (Nov. 23-29) published by the Government Information Office.
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