The Legislative Yuan was urged yesterday to speed up its review process and pass a controversial service trade agreement with China so that Taiwan’s competitiveness can be boosted at a time when many foreign investors are eyeing the huge Chinese market.
Yeh Ming-feng (葉明峰), an adviser to the Chinese National Association of Industry and Commerce, said it is particularly urgent for lawmakers to give the greenlight to the agreement Taiwan and China signed in June now that China has launched a free-trade zone in Shanghai.
Beijing launched the Shanghai experimental free-trade zone late last month to allow Chinese and foreign companies to operate with fewer government regulations in a wide range of businesses in the financial, shipping, commerce, trade and cultural sectors.
China also plans to allow more flexibility in the yuan’s fluctuations in the Shanghai free-trade zone, a step perceived as China’s willingness to narrow its gap with the global economy.
Yeh said China had been cautious about its economic openness to the outside world and now wants to use the Shanghai free-trade zone to test the waters and show its ambition of joining the US-led Trans-Pacific Partnership (TPP) trade bloc.
As Shanghai is the financial hub in China and serves as a gateway to the prosperous Yangtze River Delta, Yeh said the experimental free-trade zone will likely pose threats to its competitors in the region.
Under such a highly competitive regional market, Yeh said Taiwan has to accelerate its pace to sign free-trade agreements with its major trading partners to lower trade barriers and eventually boost Taiwan’s global competitive edge.
He said that in particular, Taiwan has to pass the service trade agreement with China as soon as possible because the trade pact is considered the most significant bilateral economic accord since the two sides signed the Economic Cooperation Framework Agreement (ECFA) in 2010.
However, the trade pact is still pending approval in the legislature, where a political standoff between the Chinese Nationalist Party (KMT) and the opposition parties have polarized operations.
Yeh said the agreement is expected to allow Taiwan a lead in the China and beat foreign investors want to use the Shanghai free-trade zone as a springboard into China.
General Chamber of Commerce of the Republic of China chairman Lawrence Chang (張平沼) agreed, saying that Taiwan cannot afford to lag behind other countries.
The top priority for Taiwan now is to pass the agreement to explore the China market as the Shanghai free-trade zone aims to turn China into a service oriented economy, Chang said.
Chang also called for the local authorities to accelerate an initiative to set up its own free-trade zone to grasp a higher share in the global market.