Sun, Apr 06, 2014 - Page 8 News List

Pact would trigger a scurry to the bottom

By Chang Kuo-tsai 張國財

President Ma Ying-jeou (馬英九) has said that, “McDonald’s, KFC and Starbucks have come over to Taiwan,” that “McDonald’s has opened 390 branches in this nation, it has been here for 30 years, employing over 200,000 people. When it first came to Taiwan, people were concerned about the impact it would have on small traditional food outlets...opening up makes Taiwan more competitive... being worried about it is like Chicken Little panicking the sky will fall.”

If Ma wants to use Uncle Sam’s McDonald’s, KFC and Starbucks as examples, then let us run with that.

Is the entire staff of these companies, from management down to counter staff, comprised of foreigners, paid more than double the average local wage, unable to speak the local language, or are they Taiwanese who can communicate with their customers? Would they be able to employ staff when they first came over here had they offered less than the going rate? Indeed, have the owners of McDonald’s, KFC and Starbucks suppressed salary levels in Taiwan? Have they not given people in Taiwan jobs?

However, what if today, there were Chinese investors opening stores selling hamburgers, fried chicken, coffee, etc? Workers’ salaries would fall and if not, then there would be no job creation. Businesses are not charities — they are profit-seeking enterprises. To increase profits, slashing wages is the best way.

If you think NT$22,000 is low, then what do you think a boss from China, where the average wage is typically a quarter of that, thinks? They would consider it too much, not too little. If they are to make a profit, they would have to insist upon pay cuts of 20 or 30 percent. The Taiwanese will just have to “be good” and accept it. If they say no, Chinese bosses will find it easy to bring in others happy just to have a job. It would only take the price of a plane ticket to bring people — management and staff alike — from China.

What would happen if Chinese investors were allowed to open stores here is they would make the most of the dual advantages of the lack of language barrier and a low domestic salary level. If they could not employ local staff for less, they would import Chinese to replace them. Bad money chases out good.

This is why Taiwanese are so against the opening up of the domestic service sector to Chinese employers. It is not just that Taiwanese are concerned, it is more that they are up in arms.

Even more worrying is that, concealed within the service Trojan agreement, it says that Chinese immigrants and spies need only prepare the sum of US$300,000 — money which can be used repeatedly — and they can enter Taiwan, perfectly legally, for three years, after which their stay can be extended for another three years, then another, indefinitely.

From a national security perspective, what chance does Taiwan have?

If Taiwan is to sign a service trade agreement, why would the first be with the only nation in the entire world that has ambitions on Taiwan’s sovereignty?

Nobody wants Taiwan to close itself off from the world, or to oppose the nation’s engagement with globalization. However, what is objectionable is tying Taiwan to China, and equating China with the rest of the world.

If Taiwan is to sign a service trade pact, why not engage with the US, Canada, New Zealand, Japan, Australia or the EU — countries and regions that do not harbor hostile intent toward the nation? Nobody would oppose that.

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