Taiwan was not the weaker party when negotiating a recently signed pact for more liberalized trade with China, even though Taiwan’s market is much smaller than China’s, government officials said.
“The preface of the Economic Cooperation Framework Agreement [ECFA] indicates that the two sides have taken into consideration each other’s economic conditions,” Minister of Economic Affairs Shih Yen-shiang (施顏祥) said in a recent press conference.
Asked if such a preface meant that Taipei asked Beijing to consider Taiwan’s much smaller economic scale during the negotiations, the minister said: “Not necessarily.”
“It is actually a mutual consideration,” he said.
For example, China’s services sector is relatively weak and therefore, little of that sector was initially opened to Taiwan under the trade pact, Industrial Development Bureau Director-General Woody Duh (杜紫軍) said.
“Taiwan took that into consideration,” he said.
Citing the digital content industry as another example, Shih said the Taiwanese government had responded to local digital content providers’ requests by asking China to open that industry, but Beijing refused to do so.
“They said they are still developing the industry, so there is no way they can open it,” he said.
The same goes for China’s refusal to allow first-wave tariff exemptions for many petrochemical products from Taiwan, because China is developing three major state-owned oil, natural gas and petrochemical companies, Duh said.
Shih also said that the negotiators from Taiwan and China spent much time determining the precise wording of the ECFA text.
For instance, he said, the Taiwan side wanted to keep the ECFA text vague and flexible, and therefore proposed that it follow “the spirit of the WTO.”
“But the Chinese negotiators complained and asked us: ‘What is the WTO spirit? It is too vague,’” Shih said.
In the end, the two sides agreed to use “the basic principles of the WTO,” the minister said, adding that there were many other examples like this.
Asked to comment on the Chinese negotiators, Bureau of Foreign Trade Director-General Huang Chih-peng (黃志鵬) said they were very familiar with WTO articles and rules.
He also lauded the Taiwanese negotiators for being well-prepared in dealing with their Chinese counterparts at the negotiating table.
He said the Chinese negotiators originally proposed opening the Taiwanese market up to more than 700 items, but the Taiwanese negotiators rejected more than 500 of them in just five minutes.
“The Chinese negotiators were very familiar with the articles of the WTO, but so were we. We also cited cases to strengthen our points and eventually talked them down,” he said.
Taiwan’s “early harvest” list ended up containing 539 items — double China’s list — with a total of about US$13.83 billion in exports, nearly 4.8 times what China obtained.
The Taiwanese negotiators will have little time to catch their breath, because they will soon enter the second stage of ECFA talks, which will be aimed at signing more agreements on cargo trade, service trade, investment protection and dispute settlement.
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