Long before Sunday’s debate on the proposed economic cooperation framework agreement (ECFA) with China, President Ma Ying-jeou (馬英九) argued that Taiwan cannot afford to be left out of increasing regional economic integration. Ma has made it clear that free-trade agreements (FTA) are a positive trend and that an ECFA would serve as a bridge with the region as ASEAN Plus One (China) and ASEAN Plus Three (China, Japan and South Korea) come into force.
The actual impact of FTAs with China on smaller regional economies, however, is only beginning to be understood. Still, early signs show that it might be wise to adopt a careful “go slow” approach.
A mere four months after ASEAN Plus One came into force, an FTA between six founding members of the organization and China, some sectors — such as textiles and garments, tires, steel and footwear — are already suffering in countries such as Indonesia, one of the signatories. Some garment factories in Jakarta have already gone under as a result of the flood of cheap Chinese clothing that have poured into the country. In some cases, the new competition drove down prices to such an extent that local companies were forced to sell jackets for less than they cost to make.
The chairman of Indonesia’s National Workers Union has said the trade deal could cost as many as 7 million jobs.
Representatives of the sectors that are at risk from the trade pact have called on Jakarta to renegotiate some aspects of the FTA or slow down the lowering of tariffs on certain products, calls the Indonesian government appears reluctant to act upon.
Still, if pressure from workers in Southeast Asian countries becomes strong enough as the negative effects of the asymmetrical FTA become more apparent, those governments may be compelled to turn to Beijing and ask for remedial measures. In the name of good relations and to protect its long-term trade interests, it is not impossible that Beijing would show some willingness to accommodate its smaller partners. The key reason is that all the members of ASEAN Plus One and ASEAN Plus Three are sovereign countries recognized by Beijing.
When it comes to Taiwan, however, an ECFA — which appears to be intended as a first step in the gradual implementation of a full-blown FTA — is not being negotiated between two sovereign states, since Beijing does not recognize Taiwan.
The long-term implications are worrying. Even if, as Ma has promised, short-term measures are implemented to mitigate the negative impact of an ECFA on vulnerable sectors of the economy and even if Beijing makes initial concessions on the “early harvest” list, China is far less likely to show flexibility over time. This is largely because it will look at that discontent and address it as a domestic problem rather than one between states. In other words, the mechanisms that normally apply to FTAs between sovereign states will not do so when it comes to Taiwan. Consequently, Beijing is expected to be far less amenable to renegotiation or goodwill once the pact has been signed, especially in light of cross-strait liberalization as a means to accelerate its unification strategy.
An ECFA will not solve every problem arising from regional economic liberalization and will undoubtedly create new ones. Although Ma prefers to address the matter as if it were purely a question of economics, the fact the two negotiating entities are engaged in an asymmetrical relationship economically and politically means that resolving those challenges will be all the more difficult.
Factory workers in ASEAN countries have difficult times ahead of them, but this could be far less onerous than the nightmare that Taiwanese workers in similar sectors could face five or 10 years from now.
The government and local industries breathed a sigh of relief after Shin Kong Life Insurance Co last week said it would relinquish surface rights for two plots in Taipei’s Beitou District (北投) to Nvidia Corp. The US chip-design giant’s plan to expand its local presence will be crucial for Taiwan to safeguard its core role in the global artificial intelligence (AI) ecosystem and to advance the nation’s AI development. The land in dispute is owned by the Taipei City Government, which in 2021 sold the rights to develop and use the two plots of land, codenamed T17 and T18, to the
US President Donald Trump has announced his eagerness to meet North Korean leader Kim Jong-un while in South Korea for the APEC summit. That implies a possible revival of US-North Korea talks, frozen since 2019. While some would dismiss such a move as appeasement, renewed US engagement with North Korea could benefit Taiwan’s security interests. The long-standing stalemate between Washington and Pyongyang has allowed Beijing to entrench its dominance in the region, creating a myth that only China can “manage” Kim’s rogue nation. That dynamic has allowed Beijing to present itself as an indispensable power broker: extracting concessions from Washington, Seoul
Donald Trump’s return to the White House has offered Taiwan a paradoxical mix of reassurance and risk. Trump’s visceral hostility toward China could reinforce deterrence in the Taiwan Strait. Yet his disdain for alliances and penchant for transactional bargaining threaten to erode what Taiwan needs most: a reliable US commitment. Taiwan’s security depends less on US power than on US reliability, but Trump is undermining the latter. Deterrence without credibility is a hollow shield. Trump’s China policy in his second term has oscillated wildly between confrontation and conciliation. One day, he threatens Beijing with “massive” tariffs and calls China America’s “greatest geopolitical
Taiwan’s labor force participation rate among people aged 65 or older was only 9.9 percent for 2023 — far lower than in other advanced countries, Ministry of Labor data showed. The rate is 38.3 percent in South Korea, 25.7 percent in Japan and 31.5 percent in Singapore. On the surface, it might look good that more older adults in Taiwan can retire, but in reality, it reflects policies that make it difficult for elderly people to participate in the labor market. Most workplaces lack age-friendly environments, and few offer retraining programs or flexible job arrangements for employees older than 55. As
RSS