Taipei and Beijing began their third round of negotiations on an economic cooperation framework agreement (ECFA) in Beijing yesterday. While no consensus was reached on an "early harvest list," negotiators told the Central News Agency that China would offer tariff exemptions or reductions on about 500 items from Taiwan — including petrochemicals, machinery, auto parts and textile products — while a little more than 200 Chinese products would enjoy similar tariff concessions upon entering the Taiwanese market. Reports said the tariff reductions for petrochemical products could be about 60 percent and those for textiles 80 percent.
The two sides, however, did not exchange “early harvest” lists, which are expected to form the backbone of the proposed deal.
The two sides will wrap up negotiations today and likely decide the time and place for the next round of negotiations, when the “early harvest” lists are expected to be finalized.
The “early harvest” list refers to goods and services that will be subject to immediate tariff concessions or exemptions.
Once the lists are finalized, Straits Exchange Foundation Chairman Chiang Pin-kung (江丙坤) will meet his Chinese counterpart, Association for Relations Across the Taiwan Strait Chairman Chen Yunlin (陳雲林), to sign the deal.
Bureau of Foreign Trade Director-General Huang Chih-peng (黃志鵬), who led the delegation, told reporters after the meeting that both sides had reached a consensus on five main areas.
The first was the preamble, general rules and text of the planned agreement, he said, which would contain five chapters and 16 articles.
The second was trade and investment. It would contain the principles and items of the trade in goods, services and investment, he said. As soon as the trade pact is signed, Huang said the two sides would follow up negotiations on those areas.
The third was economic cooperation. Both sides will specify cooperation on items such as protection of intellectual property rights, financial cooperation, trade acceleration and industrial collaboration, he said.
The fourth was the “early harvest” program. It would include a list on trade in goods and another on trade in services, he said, adding that once the lists are finalized, they would be attached to the proposed agreement as appendixes.
The last item was the appendixes, which would include the “early harvest” list, mechanism of dispute settlement, date of implementation of the trade deal and terms for its termination.
In a statement, the SEF said both sides yesterday “fully exchanged opinions” on the “early harvest” lists and “came to a significant consensus.”
It said the two sides agreed that after the ECFA takes effect, tariff reduction or exemption on certain products would begin “within a certain period of time” and regulations on certain trade in services would be more relaxed. He did not provide specifics, but said the needs of both sides were fully taken into consideration.
The SEF said the two sides agreed to proceed gradually and sign the pact under the principle of equality and reciprocity. They also agreed to take into account each side’s economic conditions and gradually reduce or remove trade and investment barriers to create a fair trade and investment environment.
Meanwhile, Democratic Progressive Party (DPP) Chairperson Tsai Ing-wen (蔡英文) yesterday accused President Ma Ying-jeou’s (馬英九) administration of oversimplifying negotiations on the trade agreement.
Speaking at a campaign stop, Tsai, in her dual capacity as candidate for Sinbei City mayor, said the government should realize that “there is no such thing as a free lunch [and that] in the future, we will have to return all these concessions the other side is giving [Taiwan].”
While the Mainland Affairs Council has expressed optimism that negotiations could be wrapped up this month, Premier Wu Den-yih (吳敦義) said on Saturday that both sides have been unable to reach an agreement on a number of key issues, including the “early harvest” list.
Taiwan Affairs Office spokesperson Fan Liqing (范麗青) said on Saturday that “China will benefit much less than Taiwan from the list in terms of the total valuation of the items and in terms of market scale.”
Tsai, however, cautioned the government yesterday to look beyond the figures.
“It would be a gross oversimplification if the government only thinks about how much [China] is willing to give up in its ‘early harvest’ list,” Tsai said. “Sooner or later ... we will have to pay an economic and political price.”
The DPP is set to hold a rally on June 26 against an ECFA, which it opposes on the grounds that it could have a negative impact on Taiwan’s more vulnerable industries because of an influx of cheaper goods from China.
The government maintains that an ECFA would benefit Taiwan’s export-based economy and increase Taiwan’s chances of signing free-trade agreements (FTA) with other trading partners.
A statement by Chinese Ministry of Foreign Affairs spokesman Ma Zhaoxu (馬朝旭) earlier this month cast doubt on the possibility of Taiwan signing FTAs with other countries after an ECFA is signed with China, prompting government officials in Taipei to call on Beijing not to block that possibility.
ADDITIONAL REPORTING BY REUTERS AND CNA
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