The impending signing of a service trade agreement between Taiwan and China is an issue that merits concern, given the opacity of the negotiation process and the long-term threat it poses on the domestic service sector, Taiwan Solidarity Union Legislator Hsu Chung-hsin (許忠信) said yesterday.
The agreement — a follow-up to the Economic Cooperation Framework Agreement (ECFA) — is expected to be signed on Friday in Shanghai, but the government has yet to disclose a list of items that will be liberalized, Hsu told a press conference.
Media reports that the hairdressing and beauty industry will be liberalized has caused a panic among local businesses, Hsu said.
Adding the construction industry to the list would also jeopardize Taiwanese control over local business with the easing of the 12 percent cap on Chinese investment, he said.
The worst nightmare would be when the ECFA’s 10-year transition period ends in 2020 and 32 service subsectors under WTO-regulated sectors, including professional services, computer and related services, research and development services, real-estate services and rental services, would have to be opened to Chinese investment based on the principle of national treatment, which means foreign and domestic businesses would be treated equally, Hsu said.
Hsu was also concerned that professional service providers, such as lawyers, accountants and engineers, would eventually have to face competition from China.
In response, Construction and Planning Agency Deputy Director-General Tung Chien-fei (童健飛) said the government has set a “three noes” policy to protect local construction firms.
These are: Chinese construction companies will not be allowed to operate in Taiwan; Chinese firms will not be allowed to bring in workers and equipment; and the shareholding of Chinese investors in a Taiwanese construction company cannot exceed that of the largest non-Chinese investor.
Hsu Chun-chin (徐崇欽), a section chief at the Bureau of Foreign Trade, said that sectors which thrive on domestic consumption, such as the hairstyling and beauty sector, are more likely to oppose market liberalization.
However, Hsu rebutted media reports, saying Chinese hairstylists would not be brought in, but he declined to disclose the complete list of sectors that will be eased, saying the agreement has not been signed.