The government has been in contact with China on the economic cooperation framework agreement (ECFA) and is considering the addition of an “opt out” clause in the trade pact, Minister of Economic Affairs Yiin Chii-ming (尹啟銘) said at a forum in Taipei yesterday.
Yiin did not provide further information about the agreement for fear that revealing too many details could jeopardize the cross-strait trade talks.
At present, the two sides are engaged in “independent analyses,” Yiin told the ECFA discussion forum hosted by the Ministry of Economic Affairs and the Mainland Affairs Council (MAC).
Yiin had previously said that government contacts with China would happen sometime next month after independent assessments are concluded by both sides. His comment yesterday showed that cross-strait talks have proceeded at a much faster pace than anticipated.
Yiin said the government welcomed differing voices and said there was more work to be done.
Yiin said he expected the ECFA would increase Taiwan's GDP growth by 1.374 percentage points.
He promised to take various suggestions into consideration, including more public disclosure and the possibility of an “opt out” clause in the ECFA.
“Once ECFA talks get underway, the potential addition of an opt out clause will be considered [to protect us] if China fails to follow the guidelines or to demonstrate good faith in the execution,” Yiin said.
Tu Jenn-hwa (杜震華), an associate professor at National Taiwan University's Graduate Institute of National Development, echoed Yiin’s remarks on an “opt out” clause, saying that many international trade agreements have such clauses.
“This measure aims to protect countries under special circumstances. A country possesses the right to inform a counterparty of its desire to terminate all talks effective one year after date of notification,” Tu said.
Former vice premier Wu Rong-i (吳榮義) said any cross-strait trade agreement needed to be signed in good faith.
“China has more than 1,000 missiles targeted at Taiwan. With all this hostility, there is no foundation of trust,” Wu said.
As any trade agreement has its pros and cons, Wu said the government should show Taiwanese the nuts and bolts of the agreement so people can assess the potential benefits and disadvantages of an ECFA.
“Signing an ECFA with China will no doubt immediately benefit industries in the petrochemical, machinery and automobile parts sectors, but for many more domestic traditional industries, small to medium enterprises as well as laborers, such an arrangement will severely jeopardize their survival,” he said.
A recent study conducted by the Chung-Hua Institution for Economic Research showed that proceeding with an ECFA with China would put 120,000 Taiwanese out of work. Workers in the electronics, agriculture and non-metal industries would be the most severely hit, it said.
Yen Ching-chang (顏慶章), former minister of finance and former chief representative to the WTO, also expressed doubts at the forum, saying that Taiwan would not necessarily be marginalized if it did not proceed with an ECFA immediately.
“We are not the EU. We are not members of the North American Free Trade Agreement … For the longest time, Taiwan has not been part of any regional economic organization,” Yen said.
“Now with the Association of Southeast Asian Nations and its free-trade zone coming into being, I feel we are jumping to conclusions when we say that Taiwan will become a fringe economy if it does not act now,” Yen said.