The government is in talks with three Asian nations about free-trade agreements (FTAs), Minister of Economic Affairs Lee Chih-kung (李世光) said at a meeting of the Legislative Yuan’s Economics Committee in Taipei yesterday.
“I cannot specify the nations that are talking with Taiwan, but I can say that we are still working on new FTAs to reduce the obstacles for Taiwanese companies,” Lee said.
The nation is facing uncertain headwinds in foreign trade, as the US is likely to withdraw from the Trans-Pacific Partnership (TPP) when US president-elect Donald Trump takes office next month.
SOUR SENTIMENT
The nation might also be excluded from the China-led Regional Comprehensive Economic Partnership (RCEP), given the sour sentiment across the Taiwan Strait since President Tsai Ing-wen (蔡英文) was sworn into office in May.
Lee said the government would still seek to join the TPP or the RCEP, and would work hard on FTAs, as well as bilateral or plurilateral agreements with other nations.
However, Chung-Hua Institution for Economic Research (中華經濟研究院) Taiwan WTO Center deputy director Roy Lee (李淳) said the government should put more effort into product-based trade negotiations, such as the WTO’s environmental goods and trade in services agreements, instead of pursuing FTAs with other nations.
“The biggest challenge for Taiwan in negotiating trade agreements with other nations is political interference from China, which is hard to get by if you talk about nation-to-nation agreements such as FTAs, bilateral and plurilateral pacts,” Lee told the Taipei Times by telephone.
Trade negotiations that involve multiple economic entities and focus on selected types of products could help Taiwan lessen the political influence of Beijing, Lee said.
BETTER PRODUCTS
However, Taiwan Institute of Economic Research (台經院) economic forecasting center director Gordon Sun (孫明德) said there is no trade agreement that can avoid Beijing’s interference.
Sun said that instead of asking the government to ink trade pacts to lower product tariffs, Taiwanese companies should improve the competitiveness of their products.
“If your products are good enough, people will buy your products even though they are more expensive due to the tariffs,” Sun said.
In addition, Taiwanese manufacturers should set up plants in overseas markets to enjoy low tariff treatments provided by local governments and expand their business globally, he said.
However, that suggestion would only benefit Taiwanese firms that expand their operations outside of Taiwan and it would not help improve the employment situation at home, he said.
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