Thu, Nov 11, 2010 page3

• UK expert talks on assessing ECFA’s impact

  TRADE PLATFORM: Taiwan needs more free-trade pacts — not just ECFA-type agreements — to see the real effect of economic liberalization, Christopher Dent said

  • By Shih Hsiu-chuan / Staff Reporter
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  A key question to ask when assessing the effects of the Economic Cooperation Framework Agreement (ECFA) that Taiwan and China signed in June is whether it will “unlock” Taiwan’s free-trade agreement (FTA) policy with its major trading partners, an academic said in Taipei yesterday.

  “Taiwan is hoping that China will let it do FTAs with other countries, but it is still not clear what Beijing’s position will be,” said Christopher Dent, a senior lecturer on East Asia’s economy at the University of Leeds’ Department of East Asian Studies in the UK.

  Dent made his keynote speech, “FTA Policies in the Asia Pacific and Taiwan’s Choice,” at a forum hosted by the European Union Center in Taiwan.

  Taiwan has signed four FTAs with diplomatic allies in Central America, which nevertheless account for less than 1 percent of Taiwan’s total trade volume, Dent said.

  ECFA VS. FTA

  The ECFA is not an FTA, Dent said, because its “very limited trade coverage of trade” is far less than the requirements under WTO rules.

  Taiwan needs FTAs with its major trading partners to see the real effect of liberalization on its economy, he said, adding that FTAs should not be just ECFA-type agreements.

  “If Beijing says to Taiwan that you can only sign ECFA-type agreement with those trade partners, such as Japan, Singapore, US, EU, other trade partners will not want to do FTAs with Taiwan because they are not substantial enough,” Dent said.

  On the prospects of Taiwan’s FTA strategy, Dent put Japan and South Korea at the top, saying the two countries, after China, were the most important FTA options for Taiwan.

  “Trade creation comes from increasing competition between similar industrial profile countries. Japan, South Korea and Taiwan have very similar industries and trade profiles, and they all like to protect their agricultural products,” Dent said.

  LITTLE BENEFIT

  Signing an FTA with Singapore would provide little benefits to Taiwan in terms of tariff gains, as the average tariff in Singapore is really low.

  “The great [impact] of an FTA with Singapore is that it would lead to a wider agreement with ASEAN,” he said.

  On the possibility of an FTA with the US, Dent said: “This certainly is possible,” as the US tends to have more power than other Taiwanese trade partners to stand up to Chinese pressure.

  However, Dent said Taiwan would have to wait, as the US already has three FTA bills — with Panama, Colombia and South Korea — that have been pending in Congress for many years.

  Dent said that while the US could suggest Taiwan join the Transpacific Partnership (TPP), he deeply doubted the likelihood of TPP talks concluding successfully.

  EU EYEING ASEAN

  The EU is also a vital option for Taiwan, Dent said.

  “But again, you have to wait for the EU, which is currently negotiating a number of FTAs around the world, including one with the ASEAN,” he said.

  Dent said the EU would first address its FTA negotiations with ASEAN before it looks for other trade partners in East Asia.
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