Mon, Nov 17, 2008 - Page 3 News List

FEATURE: Shipping industry representatives are mixed on results of cross-strait talks

By Shelley Shan  /  STAFF REPORTER

While government officials called the agreement signed between the Straits Exchange Foundation (SEF) and the Association for Relations Across the Taiwan Strait (ARATS) on Nov. 4 as “a big step forward” in cross-strait trade relations, industry representatives said the results were not quite what they had expected.

Taiwan appeared to benefit in terms of cross-strait sea transport in the recent SEF-ARATS talks, they said. Once the agreement takes effect, vessels from Taiwan will be allowed to navigate directly to 63 Chinese sea and river ports.

Companies will also be exempt from paying business and income tax revenue derived from direct cross-strait shipping.

Under the terms of the agreement, vessels registered to shipping companies in Taiwan, Hong Kong and China can engage in direct cross-strait transport of passengers or cargo.

Flag-of-convenience (FOC) vessels, or those registered in another country, will also be allowed to participate in the direct shipping service, but will be restricted to those companies already engaged in offshore shipping center transport, cross-strait third-territory container line transport and the transportation of sand and gravel. The Ministry of Transportation and Communications (MOTC) said that the nation had 477 registered FOCs. The agreement only applies to 16 of them, or about 3 percent.

Meanwhile, qualifications outlined in the agreement essentially ruled out the nation’s bulk shipping carriers and FOCs operating with other countries. Some have even speculated that the measure is meant to encourage more shipping firms in Taiwan to switch their registrations to Hong Kong instead.

The government also sees the plans to increase cross-strait chartered flights as a breakthrough. The number of chartered flights will be increased from 36 per week to 108 per week, with each country allowed 54 flights. Services will also no longer be restricted to weekends.

But Tony Su (蘇宏義), chairman of the Taipei Airliners Association, said before the SEF-ARATS talks that the nation needed at least 84 weekly cross-strait charter flights if it aimed to have 3,000 Chinese tourists visit daily.

And though China now has 21 airports available for cross-strait charter flights service, Taiwan’s carriers are only planning to fly a few profitable routes — such as flights to Shanghai, which are capped at 20 per week.

The talks between SEF Chairman Chiang Pin-kung (江丙坤) and ARATS Chairman Chen Yunlin (陳雲林) also made it possible for both countries to launch anticipated chartered cargo flight services, starting with 60 flights per month.

However, what most of the nation’s carriers really wanted was to allow the passenger jets to carry freight, which is seen as a lucrative service. So far, both Taiwan and China have only agreed that passenger jets can carry airmail and packages sent by Chinese and Taiwanese postal services.

Representatives from the transportation and travel industries generally see resuming a dialogue between the two sides of the Strait as a positive development, though they do not necessarily agree with every detail of the negotiations.

China now “has all the bargaining chips,” they say. Whether it is about limitations on flights to big cities like Shanghai, the number of Chinese provinces from which residents are allowed to visit Taiwan, or the number of travel agencies authorized to organize group tours to Taiwan, they say China is in charge.

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