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Direct links are not a cure-all for Kaohsiung

Chinese Nationalist Party (KMT) Kaohsiung mayoral candidate Huang Chun-ying (黃俊英) strongly promoted the opening of cross-strait links in his election campaign, believing that this could create tens of billions of dollars in business opportunities while encouraging businesspeople to remain in Taiwan, boosting foreign investment, increasing job opportunities and reviving Kaohsiung's port.

Echoing Huang, KMT Taipei mayoral candidate Hau Lung-bin (郝龍斌) proposed to use Taipei's Songshan Airport for direct cross-strait air links, treating cross-strait links as a cure-all. The elections are over, but the effects of these wrongheaded statements remain.

The Legislative Yuan has quickly added the proposed cross-strait opening to its agenda for debate during the next session. The proposal will inevitably cause great trouble.

But why is Kaohsiung's port in decline? The port has nothing to transport because of businesses moving. Some say transportation business is falling because of the ban on cross-strait links. But will ships stop at the port if there are no goods to carry?

Shenzhen's port in Guangdong has become the world's fourth largest port for container ships.

Why has the Chinese port grown so rapidly? There are numerous factories around it. Even Hong Kong, with direct links to Shenzhen, can't compete with the latterzbecause factories are closer to Shenzhen.

The fact is that Kaohsiung's problem lies in the relocation of businesses to China. Huang is ignoring this.

Many arguments offered in support of opening cross-straight links are groundless.

Take sea transportation. Direct shipping is much more profitable, so some argue that direct links will be good for Taiwan. Some say that direct links will help enterprises keep their roots in Taiwan, promote foreign investment and even create more jobs. But they can't offer any proof of this.

Their claims are not only arbitrary but also fabricated. According to a Mainland Affairs Council study, Taiwan's investment in China will multiply 1.9 times after opening direct links.

A survey conducted by the Chinese National Federation of Industries reached similar conclusions and said that 52.3 percent of Taiwanese businesses would increase investments in China after an opening of cross-strait links.

I can only conclude that the claims in favor of opening direct links are intentional lies from the pro-unification camp.

This raises the question why cross-strait links would increase Taiwanese investment in China.

This is a natural result of market operations. When smaller economic entities join larger ones, manpower and capital will move toward the larger entity.

The more convenient the communications and the closer the exchanges, the stronger the effect.

This has resulted in China being able to attract US$300 billion in investment from Taiwan in only 15 years.

If Kaohsiung really wants to revive its fortunes, it would be well advised to learn from Mailiao (麥寮).

Thanks to the industries growing up around the sixth naphtha cracking plant in Mailiao, the port's throughput has already exceeded that of Taichung.

In other words, a plan to promote investment in southern Taiwan is the only possibility of restoring the former glory of Kaohsiung's port.

Without actively managed direct links, the result will be the opposite and Kaohsiung's port will continue to decline and compound the problems currently facing the south.

Huang Tien-lin is a former national policy adviser to the president.

Translated by Eddy Chang and Perry Svensson
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