Fri, Feb 20, 2009 - Page 1 News List

Academics say CECA is a unification trade trap

THREAT The MAC chief defended the government's stand on inking a CECA, saying it would cause neither an influx of Chinese workers nor products into Taiwan

By Jenny W. Hsu and Mo Yan-chih  /  STAFF REPORTERS

Signing a Comprehensive Economic Cooperation Agreement (CECA) with China is just one step from de jure unification, academics said yesterday, accusing the government of being over-reliant on Beijing while neglecting the implementation of effective measures to solve the domestic economic crisis.

Speaking at a forum held by Taiwan Advocates, economists said that inking a CECA with Beijing would deter foreign investors from doing business in Taiwan, as most of the benefits would go to China while Taiwan’s unemployment rate would continue to skyrocket.

A CECA would merely be a “morphine drip” to temporarily relieve Taiwan’s financial woes without curing the ailment. As Taiwan becomes addicted to Beijing’s handouts, it would eventually lose its economic autonomy and, in the end, its sovereignty, said Kenneth Lin (林向愷), professor of economics at National Taiwan University.

“When a country loses its economic autonomy, it loses its sovereignty,” he said, urging pro-government economists and industrialists to “stop beautifying the ugliness of China’s economy.”

“President Ma Ying-jeou’s (馬英九) flawed China-centric policy will only see Taiwan’s economy and the nation deteriorate further. He does not deserve to call himself a Taiwanese,” Lin said.

He said the nation’s competitiveness would plummet if the Ma administration refused to diversify investments away from China.

Lin said Taiwan could end up in a worse position than Hong Kong, whose GDP growth slowed from 23.6 percent in 1997 to 5.2 percent in 2001 as its top resources flocked to China after the handover.

EU Study Association director Steve Wang (王思為) questioned the legitimacy of an economic treaty with China, including what title and status Taiwan would hold in such an agreement.

“Can the government guarantee that Taiwan will be on an equal footing with China and not be reduced to an administrative region? The government has yet to fully explain to the public the pros and cons of a CECA,” he said, suggesting that the agreement undergo a legislative review or a referendum before ratification.

Wang criticized the administration for telling the public that signing a CECA with China would secure economic advantages and comparing the agreement to the formation of the EU.

“The European nations formed a union to consolidate their strengths to solidify their place in the world. But Taiwan is leaning heavily on a less developed country to boost its own economy. What kind of logic is that?” Wang said.

Hung Tsai-lung (洪財隆), an associate research fellow at the Taiwan Institute of Economic Research, said Taiwan could lose its bargaining power if it panders to Beijing’s wishes.

Hung proposed negotiating a free trade agreement (FTA) or CECA with China under the WTO’s guidance and in accordance with the global organization’s laws.

Both Taiwan and China are WTO members.

Taiwan must demand that Beijing demonstrate goodwill prior to signing any agreement, such as stopping its efforts to block other nations from signing FTAs, he said.

Taiwan has signed FTAs with five of its diplomatic allies — El Salvador, Honduras, Panama, Guatemala and Nicaragua — the Ministry of Foreign Affairs said.

Meanwhile, Mainland Affairs Council Chairwoman Lai Shin-yuan (賴幸媛) yesterday defended the government’s plan to sign a CECA with China, saying it was not tantamount to a full liberalization of trade and exchanges with China.

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