Wed, Sep 13, 2017 - Page 8 News List

Fostering economic ties with UK

By Ian Inkster

At the beginning of our present century, British exports to Taiwan were large and rising, and about 170 Taiwanese companies were already operating in the British economy, employing 15,000 or so workers.

However, as a result of a 1972 agreement with China — which “acknowledged the position of the government of the PRC that Taiwan was a province of the PRC and recognized the PRC government as the sole legal government of China” — the British did not recognize Taiwan as a state.

This was somewhat of a more empathetic diplomacy than that of, say, France or Germany, who “agreed with” rather than merely “acknowledged” the Chinese definition of “one China.”

However, we might ask how much Britain has capitalized on this nuance of diplomacy, or how much it has determined Taiwanese commercial diplomacy over the intervening years.

On some measures things look healthy enough — Taiwan ranks as Britain’s sixth trading partner in the Asia-Pacific (behind China, Japan, Hong Kong, South Korea and Singapore).

However, to put things in perspective, first imagine who might be sixth if it were not Taiwan and then consider that Taiwan ranks below 30 in the global list of British trading partners.

In contrast, Britain ranks 13th globally as an importer of Taiwanese goods and services. About 68 percent of Taiwanese investment in Europe is in Britain.

At a time when Britain is looking for new trading deals globally, when Taiwan is committed — more or less — to diversification of trade from China to a wider mix of nations, and when the global economy is hardly thriving under the potentially restrictive trading regime called for by US President Donald Trump, the best longer-term tactic for Taiwan might well be to foster the British relationship, which in terms of comparative advantage appears to be mildly in Taiwan’s favor.

So, whether we see present relations between the two nations optimistically or not, we should beware selling the long term for more attractive short-term possibilities. Seeing through the confusions of a Trumpian world requires a telescope plus foresight.

Ian Inkster is a professorial research associate at the Center of Taiwan Studies, SOAS, University of London; a senior fellow at the Taiwan Studies Programme, China Policy Institute, University of Nottingham; and the editor of the international journal History of Technology.

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