The Ma government has stated repeatedly that signing an EFCA with China is vital to Taiwan’s competitiveness in the world market and that failing to do so would result in Taiwan being marginalized when China and ASEAN forms a trade bloc next year. The government, however, overlooks the fact that China has tried in every way to block Taiwan’s efforts to sign free-trade agreements with other countries.
The Ma administration has also said that signing an ECFA would normalize cross-strait trade relations and raise Taiwan’s GDP growth by 1.37 percent. The Mainland Affairs Council has not yet authorized the SEF to negotiate with China on signing an EFCA. Furthermore, the Ma administration has not presented the basis for its projected growth findings.
The opposition in Taiwan charges that entering such an agreement with China may only be beneficial to select, big industries, including electronics, petrochemicals, machinery and automobile parts, but detrimental to small industries and will ultimately increase unemployment in Taiwan. Some experts estimate that the Taiwanese economy could lose at least 120,000 jobs, especially when Beijing insists on its “one China” political framework.
January figures showed that Taiwan’s trade surplus decreased 57 percent from a year ago, the lowest in eight years. Except for ships, boats and floating structures, all exports to China, especially optical products, organic chemicals, electrical machinery and copper products, were affected by the global economic downturn.
The ECFA issue in Taiwan is still not clear. Many Taiwanese are looking to the US — especially Congress — for support. Chinese President Hu Jintao (胡錦濤) insists that Beijing is willing to negotiate with Taiwan on joining international organizations as long as it does not support “two Chinas” or “one China, one Taiwan.”
However, one wonders whether it is wise to tie Taiwan’s economy to what is now a faltering export-driven economy in China. Another question is whether the US Congress might seek to restrict trade with its largest importer and perhaps work for some gains for Taiwan in terms of recognition in the international community.
Nat Bellocchi is a former chairman of the American Institute in Taiwan and a special adviser to the Liberty Times Group. The views expressed in this article are his own.
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