The Ministry of Economic Affairs yesterday said it is considering negotiating with its Chinese counterpart on a broader range of products to be covered in the cross-strait agreement on trade in response to China and South Korea’s signing a bilateral trade agreement.
After a three-hour meeting in Seoul on Thursday, Chinese President Xi Jinping (習近平) and South Korean President Park Geun-hye issued a joint statement that Seoul and Beijing would work to complete a long-negotiated free-trade agreement by the end of the year.
In response, Vice Minister of Economic Affairs Woody Duh (杜紫軍) told a media briefing that he felt “highly agitated” about China and South Korea signing a free-trade agreement because the pact is likely to cause the nation’s businesses to lose competitiveness with their South Korean peers.
“We need to have a much better discussions about helping Taiwanese companies become more competitive with their South Korean counterparts, but the key is to let the already inked cross-strait service trade pact get ratification from the legislature first,” Duh said.
Duh said the ministry’s trade negotiation office is revising its strategies and considering negotiating a longer list of products to be covered in the cross-strait agreement on trade in goods.
The ministry said Taiwan’s panel, petrochemical and machinery industries would suffer the brunt of the new free-trade deal. Taiwan is competing with South Korea in those sectors.
Taiwanese academics have also expressed concern about the agreement between China and South Korea.
Chung-Hua Institution for Economic Research’s WTO and RTA center deputy executive director, Roy Lee (李淳) told CNA that after the signing of the agreement, Taiwan will suffer an impact in a short-time frame.
“Between 50 percent and 80 percent of Taiwan’s export items overlap with those of South Korea,” Lee said.
As China is also developing its own panel industry, it probably will not allow zero tariffs for South Korea, but even if China reduces tariffs in seven to 10 years, it will still curb Taiwan’s panel sector.
He said that Taiwan has enjoyed a trade surplus of between US$80 billion and US$90 billion with China over the past few years, while its trade surplus with the rest of the world has totaled US$30 billion.
“If Taiwan’s trade surplus with China is reduced, its trade surplus with the rest of the world will also be reduced,” he said. This, coupled with high tariffs, could induce an even faster exodus of domestic industries, according to Lee.
Taiwan Institute of Economic Research (台灣經濟研究院) Microeconomic Forecasting Center director Gordon Sun (孫明德), said that China is also the largest export destination for South Korea, accounting for 30 percent of its total exports.
“If China also completes the signing of a free-trade agreement with Japan, then Taiwan will be marginalized,” he said.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, has decided to slow down its 3-nanometer chip production as Intel Corp, one of its major customers, plans to push back the launch of its new Meteor Lake tGPU chipsets to the end of next year, market researcher TrendForce Corp (集邦科技) said yesterday. That means Intel has canceled almost all of the 3-nanometer capacity booked for next year, with only a small amount of wafer input remaining for engineering verification, the Taipei-based researcher said in a report. Based on Intel’s original schedule, TSMC was to start producing the new chipsets in
DATA SHOW DOWNTURN: Manufacturing in Taiwan contracted as production and demand slumped, while growth in chip exports last month eased in South Korea World chip sales growth has decelerated for six straight months in another sign that the global economy is straining under the weight of rising interest rates and mounting geopolitical risks. Semiconductor sales rose 13.3 percent in June from a year earlier, down from 18 percent in May, data from the global peak industry body showed. The slowdown is the longest since the US-China trade dispute in 2018. The three-month moving average in chip sales has correlated with the global economy’s performance in the past few decades. The latest weakness comes as concern about a worldwide recession has prompted chipmakers such as Samsung
‘NO NEED TO WORRY’: The central bank governor said foreign selling on the TAIEX is normal for this time of year and that the nation has ample forex reserves Taiwan would emerge unscathed from China’s retaliatory actions to protest US House of Representatives Speaker Nancy Pelosi’s visit to Taipei, top monetary and financial officials said yesterday. Central bank Governor Yang Chin-long (楊金龍) shrugged off unease over potential instability in the foreign exchange and stock markets after foreign portfolio funds trimmed their holdings of local shares for two straight days amid Beijing’s threats of retaliation. “There is no need to worry,” Yang said on the sidelines of an event to celebrate the first anniversary of the opening of Central American Bank for Economic Integration’s (CABEI) Taipei office and the 30th anniversary of
Italy is close to clinching a deal initially worth US$5 billion with Intel Corp to build an advanced semiconductor packaging and assembly plant in the country, two sources briefed on discussions said yesterday. Intel’s investment in Italy is part of a wider plan announced by the US chipmaker earlier this year to invest US$88 billion in building capacity across Europe, which is striving to cut its reliance on Asian chip imports and ease a supply crunch that has curbed output in the region’s strategic auto sector. Asking not to be named due to the sensitivity of the matter, the sources said the