Taiwan and China have agreed that the Economic Cooperation Framework Agreement (ECFA) will take effect today, the Straits Exchange F oundation (SEF) said yesterday.
The SEF said it had notified its Chinese counterpart, the Association for Relations Across the Taiwan Strait (ARATS), yesterday morning that it had completed procedures for implementing the ECFA and a cross-strait intellectual property rights protection agreement.
ARATS replied in the afternoon that its preparation for the two agreements was finished and confirmed the implementation date, the SEF said.
The Ministry of Economic Affairs said that after the agreement takes effect, it would notify the WTO as soon as possible.
Once the trade pact takes effect, the two sides are to set up a cross-strait economic cooperation committee, and within six months will initiate discussions on agreements on investment protection, commodity trade, service trade and a dispute-resolving mechanism, as stipulated in the ECFA.
A ministry official said the committee was likely to be an ad hoc organization and that the two sides could assign deputy minister-level officials to be members.
A source in China said yesterday that SEF Chairman Chiang Pin-kung (江丙坤) was scheduled to meet ARATS Chairman Chen Yunlin (陳雲林) in Shanghai on Thursday to discuss the establishment of the committee.
However, SEF Deputy Secretary-General Maa Shaw-chang (馬紹章) said that no date had been set for the meeting and that Chiang and Chen would not talk about ECFA-related issues.
Meanwhile, the ECFA's “early harvest” program will take effect on Jan. 1. The program refers to a list of goods and services that will be subject to immediate tariff concessions or exemptions.
It covers 539 types of Taiwanese goods exported to China, with an estimated annual value of US$13.84 billion, and 267 types of Chinese products imported into Taiwan, with an estimated value of US$2.86 billion.
Reiterating the opposition's objection to the trade pact, Democratic Progressive Party (DPP) spokesperson Tsai Chi-chang (蔡其昌) said the ECFA would contribute to a further widening of the wealth gap and continued deterioration of local industries.
Tsai said the administration under President Ma Ying-jeou (馬英九) should deal with cross-strait affairs carefully instead of rushing ahead.
Aside from the political risks, the ECFA would have an even more negative impact on Taiwan’s economy, the Taiwan Solidarity Union (TSU) said.
The removal of import duties on both sides and further relaxation of investment regulations will encourage more Taiwanese firms to export semi-finished products and raw materials to China for processing and re-exportation, creating more job opportunities and bringing more foreign exchange into China, the TSU said.
As such, the ECFA will only benefit China as more Taiwanese businesses relocate to China, it said.
The TSU added that with more companies in the high-tech industries moving to China, unemployment in Taiwan's manufacturing industry would spread to the technology sector.
At the same time, China will be able to export more finished consumer products to Taiwan, competing with local companies that target the domestic market, it said.
Describing the ECFA as China's first step toward the political annexation of Taiwan, the TSU said it would therefore continue to push for a referendum on the ECFA as it is the last line of defense for Taiwanese democracy.
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