The cross-strait service trade agreement was signed by the Straits Exchange Foundation and China’s Association for Relations Across the Taiwan Straits on June 21 last year. What did President Ma Ying-jeou’s (馬英九) government intend to achieve by signing this agreement? The process that led to the pact, from its inception up to its signing, has been criticized as lacking in transparency, openness and discussion.
The agreement covers many business sectors, including services that are closely connected with the lives of ordinary people, such as restaurants, hotels, wholesale pharmaceutical sales, beauty services, hairdressing, travel agencies, washing and cleaning, warehousing and storage, car rental, motor vehicle maintenance and repair, printing and publishing, online game production and development, photography, software, information services and so on. Even management consultancy and funeral services are covered. Besides labor-intensive general services, the agreement also includes financial services, which tend to be more capital-intensive.
The government’s handling of negotiations leading to its signing, and the way the authorities have, or have not, communicated with people about the pact’s contents has led to much public concern, especially given the breadth of the agreement. People are worried about the impact the agreement will have on the nation.
Taiwan excels in its modes of operation and management in the service markets and enjoys a great competitive advantage in this regard, but in signing the service trade agreement without giving consideration to opposing voices, the Ma administration has fallen into the following traps:
First, the Ma government fell into the policymaking trap of excessive confidence in its own judgement. Before signing the agreement, the government did not investigate the causes of Taiwan’s developmental problems. The government was then overly certain about its assumptions and opinions and was lax about gathering the necessary information, such as estimating the agreement’s potential influence and impact on various business sectors. It also plunged into negotiations without first consulting fully with business interests so as to reach a common understanding.
Second, the service trade agreement lacks restrictions in the way it is framed. Each sector has its own characteristics, so different agreements should be developed to cater for diverse businesses. However, the Ma administration has bundled services together and molded a policymaking mindset without thinking things through. Consequently, it has overlooked options that might have been preferential or else failed to identify important goals.
Third, the government has erred by behaving rashly. The Ma administration firmly believed that lawmakers and the public would support the service trade agreement. Consequently, in making the final decision, it did not follow a systematic set of legislative procedures, but instead rashly proceeded directly to signing the agreement with China. The failure of the Chinese Nationalist Party (KMT) to engage in a proper process of communication and consultation with the Democratic Progressive Party led to the recent clashes over the agreement in the Legislative Yuan.
Fourth, the Ma administration’s collective policymaking failed. It assumed that because many knowledgeable and seasoned experts had taken part in laying the groundwork for the trade pact, good policymaking would take place automatically and spontaneously. However, the fact that no experts with dissenting opinions took part in the negotiations laid a potentially lethal trap in the decisionmaking process.