President Ma Ying-jeou (馬英九) said that Taiwan’s trade dependence on the Chinese market had not become alarmingly excessive, contrary to the belief of many Taiwanese.
The proportion of Taiwan’s total exports going to China dropped to 39 percent over the past year, and the government’s efforts to diversify exports had reduced reliance on China, Ma said as he received the winners of the National Distinguished Accomplishment Award and the National Manager Excellence Award.
China accounted for 24 percent of Taiwan’s total exports in 2000, and the ratio rose to 40 percent in 2008, which could have alarmed the public as it seemed that Taiwan had become over-dependent on China, Ma said.
Since Ma took office in 2008, however, Taiwan has increased its exports to Japan, Europe, the US and ASEAN, thereby reducing reliance on China, he said.
However, Ma said a close trade relationship with China is unavoidable, as China is the biggest trading partner of 17 out of its 23 neighboring countries, including Taiwan.
“[Taiwan] cannot avoid putting eggs in the biggest basket,” Ma said.
Alluding to Canada’s and Mexico’s immense trade reliance on the US — the US accounts for 75 percent of Canada’s and Mexico’s total exports — Ma suggested that interdependence between Taiwan and China is a natural consequence of geographical proximity.
To lessen reliance on China and seek broader markets, Taiwan must evolve from an efficiency-driven system to an innovation-driven economy and lower its barriers to foreign trade, Ma said.
Establishing free-trade partnerships has been his policy to bolster Taiwan’s ties with other economies, Ma said. The Economic Cooperation Framework Agreement with China for example, has earned Taiwan two free-trade partners — Singapore and New Zealand — as well as a bilateral investment agreement with Japan, because Taiwan can serve as a foothold to the Chinese market, Ma said.
Further trade liberalization must be accelerated to catch up with Taiwan’s competitors, including South Korea, he said.
China and South Korea — Taiwan’s major competitor for exports — are likely to sign a free-trade agreement in the first half of the year, which would without doubt have a major impact on Taiwan’s exports, more than 70 percents of which overlap with South Korea’s, Ma said.
To sustain Taiwan’s competitiveness, Ma called for greater trade liberalization and economic integration with major competitors, including China.