The deal, signed on Sept. 9 and quietly tabled late last month, is to be ratified, behind closed doors, within just 21 sitting days and without any public hearings. Legislators on the trade committee were briefed for just one hour by government officials last week, with no independent witnesses present.
To any Taiwanese who has tracked the style of negotiations between President Ma Ying-jeou’s (馬英九) administration and China in the past four years, the situation described above will sound eerily familiar.
However, the deal in question is not the Economic Cooperation Framework Agreement (ECFA) signed in 2010 after six months of negotiations, or the investment protection agreement inked on Aug. 9. It is the Foreign Investment and Protection Agreement (FIPA) between China and Canada, which critics say requires public scrutiny and risks putting Canada at a disadvantage.
However, the Conservative government of Canadian Prime Minister Stephen Harper refuses to hold public hearings and seems intent on forging ahead with an agreement that even its supporters admit contains flaws.
Among the most alarming aspects of the deal are its 31-year lifespan, in contrast with the six months’ warning necessary for Ottawa to pull out of the North American Free Trade Agreement (NAFTA), and the failure by Canadian negotiators to ensure that investors receive “national treatment” in China, which means that, at best, Canadian investors in China can expect treatment similar to that enjoyed by domestic Chinese firms. Moreover, Canada would be barred from imposing conditions favoring Canadian workers or resources for projects within Canada and it would be forced to restrict domestic access to fossil fuels, uranium, forests, fish and all other exhaustible resources in equal measure to any restrictions placed on exports to China, as Green Party Leader Elizabeth May said in an Oct. 1 press release.
Needless to say, such clauses are cause for concern when one deals with a resource-hungry rising power like China, whose state-owned firms are in the process of acquiring a large segment of Canada’s oil companies and fields, such as the proposed US$15 billion Nexen deal.
Then there is the clause that allows Chinese state-owned enterprises to sue the Canadian government for laws, regulations and court decisions that could “interfere with or prevent present or future profits.” While NAFTA contains similar provisions, FIPA goes further, as litigation could be done in secret with special tribunals, in which only the federal government can participate, leaving local governments and firms out in the cold.
The problem with all this is that investment between Canada and China is likely to be mostly one-way, with Chinese investment vastly outgunning that from Canada. This means that the risks are mostly Canada’s.
The Taiwanese government should pay close attention to what transpires between Canada and China in the coming months and years, as Beijing’s behavior and that of Chinese companies could provide important clues as to how they might behave in Taiwan. There are many instances of overlap, in which “unjust” clauses tend to favor China, and those could gain in importance as Taipei further opens up the country to Chinese investment.
It has often been said that Taiwan’s engagement with China can serve as a model for the international community and as a means to “predict” Beijing’s behavior. It is now apparent that Taiwan is not the only country that is facing skewed agreements. It may not have Canada’s natural resources, but intellectual property rights and company secrets in key high-tech sectors are just as likely to be targeted by Chinese investors. Most assuredly, Taiwan can learn a few things from Canada’s FIPA experience with China.
Taiwan Semiconductor Manufacturing Co (TSMC) founder Morris Chang (張忠謀) has repeatedly voiced concern over the weakening cost competitiveness of its US fabs and challenged the US’ “on-shore” policy of building domestic semiconductor capacity. Yet not once has the government said anything, even though the economy is highly dependent on the chip industry. In the US, the cost of operating a semiconductor factory is at least twice the amount required to operate one in Taiwan, rather than the 50 percent he had previously calculated, Chang said on Thursday last week at a forum arranged by CommonWealth Magazine. He said that he had
The Twenty-Four Histories (中國廿四史) is a collection of official Chinese dynastic histories from Records of the Grand Historian (史記) to the History of the Ming Dynasty (明史) that cover the time from the legendary Yellow Emperor (黃帝) to the Chongzhen Emperor (崇禎), the last Ming emperor. History is written by the victors. These histories are not merely records of the rise and fall of emperors, they also demonstrate the ways in which conquerors embellished their own achievements while deriding those of the conquered. The history written by the People’s Republic of China (PRC) is no exception. The PRC presents its
In August 2013, Reuters reported that Beijing had been gaining soft power with investment commitments and trade with countries in Latin America. However, instead of jumping on the chance to make new allies, China stalled requests to establish diplomatic relations with the countries to avoid galling Taiwanese voters. Beijing was also courting then-president Ma Ying-jeou (馬英九), and the tactic left China with a trump card if cross-strait relations turned cool. China had rebuffed at least five countries’ requests to switch diplomatic recognition to Beijing, the report said, quoting a China analyst. Honduras could become the ninth diplomatic ally, and also the fifth
OpenAI has announced a major upgrade to the technology that underpins ChatGPT, the seemingly magical online tool that professionals have been using to draft e-mails, write blog posts and more. If you think of ChatGPT as a car, the new language model known as GPT-4 adds a more powerful engine. The old ChatGPT could only read text. The new ChatGPT can look at a photograph of the contents of your fridge and suggest a dinner recipe. The old ChatGPT scored in the 10th percentile on the bar exam. The new one was in the 90th. In the hours since its release,