A trade unionist from Hong Kong said in Taipei yesterday that closer economic relations with China would not necessarily boost Taiwan’s economy.
The Hong Kong Confederation of Trade Unions organizing secretary Vincent Sung (宋治德) said that the Closer Economic Partnership Arrangement (CEPA) between China and Hong Kong had not revitalized the local manufacturing industry or generated an increase in wages.
Sung said the CEPA only benefits multinational corporations and a minority of specialists, and that this was something Taiwan should consider before signing an economic cooperation framework agreement (ECFA) with China.
Sung was invited to participate in a symposium organized by the Taiwan Solidarity Union (TSU) and the Taiwan Labor Front (TLF, 台灣勞工陣線) on the effects of an ECFA between Taiwan and China.
Sung said the Hong Kong government promoted the CEPA by saying that with zero customs fees, Hong Kong’s manufacturing industry would be able to attract local and foreign manufacturers to produce high quality products locally and thus increase employment.
However, Sung said that statistics showed that the export value for mechanical equipment, instruments and components and spare parts industries had dropped by 24.3 percent by December 2006 compared with December 2005, which was evidence that the CEPA had not managed to resuscitate the manufacturing industry.
Sung also said that Hong Kong’s manufacturing industry had been moving north into China since the 1980s and that the remaining manufacturing industry had contracted significantly.
He said most Hong Kong manufacturers did not create their own brands, that Hong Kong products had a low market share in China and that zero customs fees had not attracted manufacturers back to Hong Kong, which made it difficult to improve the situation.
Sung also said that since 2006, only 1,000 positions in China created by the CEPA had gone to people from Hong Kong, which was evidence that the agreement was not of much use for local residents.
With reference to the CEPA tourism plan, Sung said that spending by Chinese tourists in Hong Kong reached HK$9.3 billion (US$1.2 billion) in 2006, an increase of 38 percent over 2004. Although this increase had improved employment opportunities in the hotel and food and beverage industries, salaries in these industries dropped by 0.5 percent between December 2005 and December 2006.
Sung said that the CEPA had opened up the Chinese market to Hong Kong, which intensified competition between Hong Kong and Chinese companies.
To maintain their competitiveness, companies on the mainland increased their pressure on Hong Kong workers, which was evidence that the CEPA was only beneficial to big multinational companies and a minority of individuals, he said.
Sung said he also believed that since the ECFA being discussed in Taiwan still had no concrete content, it was useless to try to assess the effects of such an agreement. However, he felt that Hong Kong’s experience could be a good reference for Taiwan.
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