Hallelujah! Somebody in Taiwan has finally seen the light about the WTO. After months of dire prognostications from the mainstream media about how the entry of Taiwan and China into the WTO will bring economic disaster for Taiwan, the good folks at the Council of Agriculture (COA) have gone and pricked the bubble.
The conventional wisdom is that in many areas, especially agriculture, but also many sectors of manufacturing, Taiwan faces an imminent deluge of cheaper Chinese products, leading to mass unemployment and the hollowing out of Taiwan's economy. This would certainly be an alarming prospect, so it's a good thing it's not true.
The key element in the true story is Beijing's continuing adamant refusal to allow any cross-strait matters, even purely trade-related ones, to be discussed under the WTO framework. To quote the irrepressible Zhang Mingqing (
What China absolutely wants to avoid is the invocation of the WTO dispute-settlement procedure, which not only would put the two sides on an equal legal footing, but -- horrors! -- would intersperse a neutral international party between them, ie: a WTO tribunal. China is obviously not even close to being mentally prepared for this eventuality.
Which brings us to the announcement by the COA on Nov. 20. What they said, in effect, is that they have no plans to open the market to Chinese agricultural products, but only to those of other WTO members (according, naturally, to the timetables laid out in the intricate accession agreements). Surely this would violate the WTO's core principle of non-discrimination.
Well, the COA officially says they don't believe it would, but that if China disagrees, it is welcome to initiate WTO procedures by requesting consultations with Taiwan. Bravo! Since the cadres in Zhongnanhai have no intention of doing so, they just have to swallow their objections, and thus Taiwan's behavior will stand unchallenged. This is wonderfully convenient.
What it means is that Taiwan can violate the WTO agreements with respect to China as much as it likes, and no need to fuss with the notorious "exclusionary clause" or anything. Although so far only the COA has gone public with this, there is no reason why the same tactic cannot be applied to, say, textiles, or education or really any Chinese goods and services at all.
Of course, eventually all these markets should be opened, and they will be in due course. But the fact is that Taiwan doesn't need to start moving until China acknowledges the reality that Taiwan is an equal member of the WTO. Only then will Taiwan have to make the hard adjustments, and at that point the pain will be at least partially balanced off by the diplomatic breakthrough.
In the meantime, the government and industries can spend their energies dealing with the competition from the rest of the WTO membership first, and take all the time they need to get ready for the Chinese. The only twist would be if some third country claimed that it was also being harmed by continued Taiwanese restrictions, and filed a separate complaint.
In theory this might occur if, for example, the goods in question were produced by a German company's factory in China. But this need not be disastrous. If any other WTO members requests consultations, Taiwan can be very polite and simply give in, at least on that particular case -- "sorry, we never intended to harm your interests, no hard feelings, right?"
Alternatively, if by that time Taiwan has decided it is ready for the Chinese competition, and feels the international respect is worth more than its "special" protections, one could try a different tack. Taiwan could argue, pretty justifiably, that the complaint cannot be heard properly without the participation of China, as an intimately involved party. Then the original complainant would have to go and request Beijing to join the action.
In fact, if one were clever, one could intentionally design such a test case. Slap an egregious restriction on some good that would definitely draw a complaint from a third country, but equally definitely require China's participation. Then sit back, smiling oh-so-reasonably ("we really want to help, we'd love to start consultations soon as possible, etc ..."), and let the other country do the dirty work of lobbying Beijing.
It seems like a fantastic vision to imagine, say, Airbus or Microsoft putting pressure on Beijing to get real about Taiwan, doesn't it? All in all, this looks like a win-win situation for Taiwan. Either you get the legal recognition from China that you crave, or you sit as long as you like on a "get-out-of-jail-free card" from the worst impacts of WTO entry. Enjoy!
Bo Tedards is a political commentator based in Taipei.
If you had a vision of the future where China did not dominate the global car industry, you can kiss those dreams goodbye. That is because US President Donald Trump’s promised 25 percent tariff on auto imports takes an ax to the only bits of the emerging electric vehicle (EV) supply chain that are not already dominated by Beijing. The biggest losers when the levies take effect this week would be Japan and South Korea. They account for one-third of the cars imported into the US, and as much as two-thirds of those imported from outside North America. (Mexico and Canada, while
US President Donald Trump’s challenge to domestic American economic-political priorities, and abroad to the global balance of power, are not a threat to the security of Taiwan. Trump’s success can go far to contain the real threat — the Chinese Communist Party’s (CCP) surge to hegemony — while offering expanded defensive opportunities for Taiwan. In a stunning affirmation of the CCP policy of “forceful reunification,” an obscene euphemism for the invasion of Taiwan and the destruction of its democracy, on March 13, 2024, the People’s Liberation Army’s (PLA) used Chinese social media platforms to show the first-time linkage of three new
I have heard people equate the government’s stance on resisting forced unification with China or the conditional reinstatement of the military court system with the rise of the Nazis before World War II. The comparison is absurd. There is no meaningful parallel between the government and Nazi Germany, nor does such a mindset exist within the general public in Taiwan. It is important to remember that the German public bore some responsibility for the horrors of the Holocaust. Post-World War II Germany’s transitional justice efforts were rooted in a national reckoning and introspection. Many Jews were sent to concentration camps not
Deflation in China is persisting, raising growing concerns domestically and internationally. Beijing’s stimulus policies introduced in September last year have largely been short-lived in financial markets and negligible in the real economy. Recent data showing disproportionately low bank loan growth relative to the expansion of the money supply suggest the limited effectiveness of the measures. Many have urged the government to take more decisive action, particularly through fiscal expansion, to avoid a deep deflationary spiral akin to Japan’s experience in the early 1990s. While Beijing’s policy choices remain uncertain, questions abound about the possible endgame for the Chinese economy if no decisive