For Taiwan, it has been four years since President Ma Ying-jeou (馬英九) introduced the Economic Cooperation Framework Agreement (ECFA) and a year since its “promised land” follow-up cross-strait service trade agreement.
The calculated plan behind all this was that it would surely kick-start Ma’s “Golden Decade.” That decade, with promises of renewed prosperity would, in turn, hopefully salvage Ma’s bogus “6-3-3” campaign pledge of 2008.
It has been a long winding path for the nation — and not without the chorus of accompanying Chinese Nationalist Party (KMT) pundits whose prophetic promise has been the rapture of future economic salvation.
Unfortunately, the country still remains in the shadow of unfulfilled dreams, akin to those described by T. S. Eliot in The Hollow Men: “Between the conception, And the creation, Between the emotion, And the response, Falls the Shadow.”
Taiwan has lived under the shadow of unfulfilled dreams and vague economic promises for all six years of Ma’s reign.
The Wall Street Journal became the latest to sully its editorial pages with vague promises of fortunes galore balanced by doom and gloom predictions of the nation’s demise if it, without proper examination, does not immediately jump aboard the great gravy train of trade.
One can only marvel at the extent of ink and words that have been wasted in this vagary of vagaries. It is not that anyone doubts that trade and globalization can be beneficial; it is just that there are good trade deals and there are bad trade deals and to tell the difference one must examine them carefully. Regardless, each side continues to trot out its “experts” and supporters, but none go to the heart of the matter.
On Ma’s side, the creation of his team has not lived up to its conception. Ironically, despite a track record of incompetence and bumbling, the Ma government still presses on with its simple “Trust us [blindly]” motto.
While Ma’s team is saying: “Trust trade with benevolent China and we will all prosper,” the other side is saying the famous line from Jerry Maguire: “Show us the money.”
Or to paraphrase it in context: “Be transparent and show us how the long-term risks to our sovereignty and growth do not outweigh any temporary profit.”
As a result, Taiwanese still find little solace in the continuing lines of Eliot: “Between the potency, And the existence, Between the essence, And the descent, Falls the shadow.”
Amid this shadowy rhetoric, the continued promise of trade potency remains, but with no clarity of result and despite the prediction of a strong economic essence, a descent seems dangerously imminent. The shadow remains. It is with this in mind that I put forward a modest proposal, with more bottom-line clarity, that could satisfy the calls for transparency and set the stage for rational discussion.
There are 64 Taiwanese industries that are to be opened up to Chinese investment; the up to 80 industries that China would open to Taiwanese investment, I will leave aside for future separate comment. These 64 industries contain thousands of small and medium-sized Taiwanese businesses that will be at risk under liberalization. Among these industries are those that involve Taiwan’s infrastructure, its telecommunications and printing fields, and its freedom of speech and security. All are vital fields that should not be compromised or negotiated without proper examination and debate.
Comparing Taiwan and China as two international corporations agreeing a deal, the question remains: “How carefully should a medium-sized corporation enter into a deal with a larger corporation, especially when that larger corporation continually threatens a hostile takeover if its long-range terms are not met?”
Enter, then, transparency. Most admit that among the 64 industries that Taiwan would open to the China, there are some areas that favor Taiwan and others that favor China. However, and here is the key, no one spells out the vagary of how many and which ones.
One way to do this is to formulate a Boston Matrix to evaluate the 64 industries in a simple, clear way.
Let us consider that the government is the Cash Cow of the matrix; it of course will support all directives of the state and must be protected at all costs. That leaves three remaining matrix categories where the 64 industries can be put on a balance sheet for all to see and be openly discussed and evaluated. Which ones are considered Dogs (losses) that could be sold off or left free for outside investment and control; which ones are Stars (guaranteed winners) that must be protected in their rise and finally which are Question Marks (possible Stars or Dogs) where outside investment can aid growth or hasten decline.
In Taiwan’s vagary of vagaries, no pundits have thus far risked any opinion except to continue uttering the mantra that trade and investment are good. As hollow men, they have only provided hollow promises and hollow solutions. Yet the nation’s citizens, as stockholders in this corporation, deserve much more than that.
The proposed portfolio discussion and debate provides each side the opportunity to classify industries and ask for proof from stockholders. It also lets the different industries know how they are evaluated and where they stand with this corporation.
Which ones are willing to be sacrificed by the administration, if not all? Which are question marks that must be proved? Even with the Stars, who owns these so-called “star companies?” Which owners will benefit most from outside investment?
All sides can present their evaluation and some decent results-oriented debate is possible. The public, in turn, can have their own balance sheet to follow the discussions item-by-item, industry-by-industry, so they will know where their legislators stand. Such debate has the potential for transparent accountability with a vengeance for Taiwanese stockholders.
The coming debate may even point to whether Ma’s eight years will end not with a bang, but a whimper. Is Taiwan up to it?
Jerome Keating is a writer based in Taipei.
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