Taiwan will not sign pact with China, MAC states

The Mainland Affairs Council (MAC) said yesterday Taiwan would not consider signing a Closer Economic Partnership Arrangement (CEPA) with China such as China signed with Hong Kong and Macau earlier this year.

Fu Don-cheng (傅棟成), director of the council's economic affairs department, said such a pact is out of the question because it is a product of China's "one country, two systems" formula.

On Wednesday, China's Ministry of Commerce and the Chinese Cabinet's Taiwan Affairs Office (TAO) said China wanted to further economic cooperation with Taiwan under the CEPA framework.

A CEPA, said the Hong Kong Trade Development Council, would liberate measures in the goods and services trade, and the framework for trade and investment facilitation between China and Hong Kong.

Hong Kong-based foreign companies exporting goods and services to China have seen the easing of tariffs and other regulations as benefits of the pact, according to the council.

However, as China said the two parties signing the pact needed to be "two regions in the same country," Taiwan would not consider the possibility of such an arrangement with China, Fu said.

An Min (安民), China's Vice Minister of Commerce, said at a CEPA conference in Guangdong the highest purpose of the arrangement is to achieve the country's unification.

Li Weiyi (李維一), a TAO spokesman, said opening the three links between Taiwan and China -- transportation, communication and commerce -- should be a precondition for both sides to start talks about a CEPA.

Lin Yi-fu (林義夫), Taiwan's Minister of Economic Affairs, said using "arrangement" to describe the pact carries the implication that the framework exists only between two regions of a country.

In most cases, a country-to-country pact is called an "agreement" rather than an "arrangement," Lin said.

He suggested China rather sign a free trade agreement with Taiwan.

Nevertheless, Theodore Huang (黃茂雄), chairman of the Chinese National Association of Industry and Commerce, said having a CEPA with China is "not a bad thing."

Noting Taiwan and China's economies are closely linked, Huang said he believed signing a CEPA with China will benefit Taiwanese businessmen.

Huang the appropriate time to raise the CEPA issue would be after next year's presidential election, because then political factors will not affect the issue too much.