Fri, Mar 06, 2009 - Page 3 News List

Economists slam plan to sign an ECFA

CARROT AND STICK Economics professor Chiou Jiunn-rong said that political considerations when signing economic accords far outweigh the economic ones

By Ko Shu-ling  /  STAFF REPORTER

The administration of President Ma Ying-jeou (馬英九) should pressure Beijing into promising that it would let other ASEAN nations sign free trade agreements (FTA) with Taiwan if it is sincere about improving economic ties, an economist said at a forum organized by the Taiwan Thinktank in Taipei yesterday morning.

Taiwan Thinktank chairman Chen Po-chih (陳博志) said the proposed economic cooperation framework agreement (ECFA) the administration wants to sign with Beijing would put the nation in an unfavorable position, not only economically but politically.

“It is like hunting: When you surround the animal from all sides it can only fall into your trap,” Chen said. “China’s suppression is the main reason we cannot sign any FTAs with other nations or join regional cooperation organizations. When China is interested in signing an economic accord with us, its purpose is clear.”


A smarter way to go, Chen said, was to demand fair treatment from China rather than begging for special treatment.

“When we discuss further economic cooperation with China, we must ask China to allow other nations to cooperate with us in return,” Chen said.

When the nation negotiates an economic pact with China, he said, the government must also begin negotiations on signing FTAs with other nations, such as the US, Japan and ASEAN members.

Chen criticized the Ma administration for exaggerating the damage that the nation’s exclusion from the “ASEAN plus one” framework has done. The negative impact was not as significant as the administration has said and the government must immediately call a halt to its plan to sign an ECFA with China, Chen said.

While the government has argued that the economic pact would help normalize cross-strait trade, Chen said it would only make Taiwan more economically dependent on China and in reality economic ties would become more abnormal because the purpose of the accord is to give preferential treatment to trade between Taiwan and China.


The government has said an ECFA would target certain industries so they could reap an “early harvest.” Chen dismissed this as a “horrendous deception,” saying that other industries would pay a much higher price in the future.

Chiou Jiunn-rong (邱俊榮), an economics professor at National Central University, said he was not confident that China would allow other nations to sign FTAs with Taiwan because Beijing itself was not keen on signing them.

Saying that it was wishful thinking that an ECFA would benefit only Taiwan, Chiou said that China would ask Taiwan to reciprocate when it demanded tariff reductions or exemptions for certain products or industries.

“Since we set a lot of limits on Chinese products, who do you think will benefit when China asks us to remove these restrictions?” Chiou asked.


While Ma has said the pact would steer clear of the sovereignty issue, Chiou said economic accords, such as an FTA, have long been used by powerful nations such as the US as a political tool to push its own diplomatic agenda.

“It is an important and effective carrot,” Chiou said.

“The political considerations definitely outweigh the economic ones,” he said.

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