The Sunflower movement against the cross-strait service trade agreement has energized society. When protesters ended their occupation of the legislative chamber, they vowed to take the battle to every corner of the nation, but what does the agreement really entail? What impact will it have on industry and individuals?
The civic movement initiated by the students has set off an unprecedented debate about whether the agreement will help improve the nation’s economy or drag it further down. These issues are now being broached in broad daylight, leaving the inept government no place to hide.
Before any policy is formed, it is necessary to have a complete understanding of the situation to identify and solve potential issues. That is the only way to promote progress.
Rather than repeating that the agreement brings “more advantages than disadvantages,” President Ma Ying-jeou (馬英九) and Premier Jiang Yi-huah (江宜樺) should be straight with the public about what studies on the production capabilities and international competitiveness — including competitiveness in China — of different industries it has carried out over the years. What are the reasons for the continuing high unemployment rate and falling salaries?
The only report on production value and labor productivity that the Directorate-General of Budget, Accounting and Statistics (DGBAS) has is from 2012 — the year the Economic Cooperation Framework Agreement (ECFA) took effect. In terms of the industrial sector, the DGBAS only said that the ECFA’s early harvest list continued to have an effect. It also said that the service sector continued to benefit from the 20 percent increase in visitors to Taiwan and the policy of cross-strait deregulation. Despite this, a look at overall labor productivity shows that it dropped by 0.46 percent that year compared with the year before.
Enhancing industrial competitiveness means increasing labor productivity, which not only promotes economic growth, but also helps stabilize prices, lower production costs and increase salaries. However, a look at the official data shows the reality to be very different. We are still waiting for last year’s report, probably because the numbers fail to show that President Ma Ying-jeou (馬英九) has delivered on his promises.
The fundamentals of Taiwan’s economy are based on public welfare: job guarantees and salary increases. Last year, the average unemployment rate was 4.18 percent — 478,000 people — the highest among the Four Asian Dragons.
When we consider that there are 8,122,000 people not looking for work, 46,000, or 0.57 percent, more than the previous year and that the number of people working atypical jobs — part-time, temporary or for temp agencies — had reached 759,000 by May last year, or 6.9 percent of all employed, the issue gets even more complicated.
Such jobs make unemployment figures look better, but at the same time, studies by the National Science Council (the forerunner of the Ministry of Science and Technology) show that the average salary for temp workers is a mere NT$26,800 (US$887). This is another reason salaries are dropping. Average real monthly salaries last year stood at NT$45,606, the same level as 16 years ago. The student movement arose against a backdrop of all these indicators of public hardship. Have Ma and Jiang addressed these issues? How should they be resolved?
The cause of Taiwan’s illness is the massive outflow of businesses, undermining domestic production. This in turn has affected employment and forced people to accept lower pay. Anyone who is internationally mobile, productive and willing to work abroad left long ago. The main aim for the government should be to increase employment and improve production for those who want to stay in Taiwan.
Despite this, the Ma administration has tried to force through the service trade agreement, having the opposite result.
Looking at the agreement and its attachments shows it is aimed at the few companies that have been capable of moving to China. Many of these companies maintain an office in Taiwan so they can raise money from Taiwan’s capital markets to investment in China. They create employment in China and benefit China by paying taxes, but what is their contribution to Taiwan?
Another aspect of the agreement is that it provides an unequal opening of Taiwan’s domestic service industries to Chinese investment and workers. Once this agreement is passed, companies servicing local communities are at risk of going bankrupt, salaries will drop even further and employment opportunities will disappear.
Other areas at risk are national security and culture. Ma keeps repeating the mantra that the agreement offers “more advantages than disadvantages,” while at the same time preparing almost NT$100 billion to subsidize industries that are impacted by the agreement.
Why does he not use these funds to upgrade industry, improve competitiveness, increase employment and raise salaries?
He should also give the young generation a clear explanation of why he is only concerned with facilitating matters for those willing to invest in China, but does nothing for those who stay in Taiwan.
The minister of economic affairs has talked of how he wants young Taiwanese to be able to go to China and earn NT$50,000 per month — why does he not make an effort to allow them NT$50,000 per month here in Taiwan?
Recently there have even been reports from China that it was the Ma administration that suggested that the service trade agreement, including logistics, should be signed even before negotiations for the trade in goods agreement had been completed, making it clear that Ma has completely ignored international negotiation precedents and expertise because he was eager to move things forward.
He has used the methods described here, which run counter to reality and good conscience, to pursue his own individual goals.
How could anyone behaving so egoistically ever dream of making a mark in history? Instead, he should be left on the ash heap of history.
Translated by Perry Svensson
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