The Ministry of Economic Affairs (MOEA) will soon release a position paper on the plan to sign an economic cooperation framework agreement (ECFA) with China to seek public support for the proposal, ministry sources said.
The paper will be presented in a question-and-answer format to expound on the necessity to strike such a deal with China and to clarify misunderstandings about the proposed pact’s content and effects, the sources said.
The paper will stresses that without such an agreement, the benefits of any tariff exemption or concession pacts that may be signed between the two sides would be offset by requests from other WTO members for the same treatment, the sources said.
Noting that the proposed cross-strait ECFA is a precursor to a regional trade agreement (RTA) or a free-trade agreement (FTA), the sources said the WTO has been encouraging its members to develop closer economic relations by signing such pacts to boost bilateral or multilateral trade.
WTO members who have signed RTAs or FTAs are allowed to mutually enjoy preferential trading terms or tariff treatment under those agreements without being subject to the restrictions of the most-favored-nation principle, the sources said.
If Taiwan signs a ECFA with China, then tariff concessions stipulated in the pact would only be applicable to the two signatories and no other WTO members would be able to ask for the same treatment, the sources said.
The major differences between an ECFA and an RTA/FTA mainly lie in the fact that an RTA/FTA tends to cover more topics and therefore takes more time to finalize negotiations, the sources said.