Thu, Jul 05, 2012 - Page 8 News List

Economic policy requires focus

By Tung Chen-yuan 童振源

China is the nation’s biggest trading partner and the destination of the bulk of its foreign investment. It is only common sense that we sign a trade cooperation agreement. Nevertheless, the disappointing results of the ECFA to date show that Ma’s strategy is flawed and his commitment wanting.

It is also far from clear whether the ECFA will remove China’s objections to the nation negotiating FTAs with its major trading partners — the US, Japan and Europe — as Beijing itself has not yet signed FTAs with them.

In the face of fierce competitive pressure caused by rapid regional economic integration, it makes most sense for the nation to concentrate its efforts on negotiations with China and the US, prioritizing the signing of FTAs with those two countries. This should enable us to break through the political obstacles put in our way by China and maximize economic returns. The nation’s next priority should be negotiating FTAs with Japan, the EU, Southeast Asian nations and Hong Kong.

If the government wants to promote bilateral FTA negotiations it has to be prepared to promote economic liberalization and that requires reaching consensus with the opposition. Such an approach requires a thorough analysis of strengths, weaknesses, limitations and opportunities and the implementation of a set of comprehensive measures to address the conclusions of that analysis, while integrating business interests with economic restructuring.

Finally, and most crucially, the government must help get more people back into work.

Tung Chen-yuan is a professor in the Graduate Institute of Development Studies at National Chengchi University.

Translated by Paul Cooper

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