Chinese Nationalist Party (KMT) legislators are assisting China to reroute exports through Kinmen County with their “free-trade zone” proposal, enabling Chinese goods to be labeled as “made in Taiwan” to avoid US tariffs, Democratic Progressive Party (DPP) lawmakers said yesterday.
It is a crucial time for tariff negotiations with the US, and the government must take measures against the dumping of Chinese goods and efforts to engage in trade fraud to falsify the country of origin, DPP Legislator Chen Su-yueh (陳素月) told a news conference at the legislature in Taipei.
Taiwan could be seen as colluding with China to circumvent the 145 percent tariff imposed on Chinese imports to the US, Chen added.
Photo: Liu Hsin-de, Taipei Times
“We must not let the opposition parties sabotage tariff negotiations and good Taiwan-US trade relations,” she said.
KMT Legislator Chen Yu-jen (陳玉珍), representing Kinmen, along with other KMT lawmakers, has proposed establishing an “offshore free-trade demonstration zone” in Kinmen and Lienchiang counties by amending Article 18-1 of the Offshore Islands Development Act (離島建設條例).
The proposal would enable the transshipment of goods by Chinese firms via the outlying island counties near China’s Fujian Province.
“These Chinese exports would then change their label to say ‘made in Taiwan,’ as a way to falsify the country of origin and evade US tariffs on Chinese goods, and would also undermine Taiwan’s national security,” DPP Legislator Puma Shen (沈伯洋) said.
“The KMT’s offshore trade zone proposal would make the Kinmen County Government the decisionmaker on the types of goods and services imported, setting standards on customs inspection, which are meant to be the responsibility of the central government,” Shen said, adding that the Bureau of Foreign Trade should crack down on such trade fraud with stronger measures against the transshipment of Chinese goods.
Under the KMT’s proposal, the zones in Kinmen and Lienchiang counties would provide free-trade access for Chinese citizens and companies, and Chinese goods and investment, DPP Legislator Michelle Lin (林楚茵) said, adding that “it is for the benefit of and access for Chinese nationals.”
DPP Legislator Tsai Yi-yu (蔡易餘) said that cases of trade fraud by altering the country of origin would increase, as some Taiwanese companies have already set up shop in China, taking advantage of cross-Strait trade and the transshipment of goods produced in Chinese factories, which are then listed as being made in Taiwan.
“If this situation continues, then Taiwan could become a ‘back door’ for Chinese goods, and therefore be viewed as one collective business entity, meaning Taiwan could face the same US tariffs imposed on Chinese goods,” Tsai said. “So our government must take immediate action to redouble efforts on customs inspection and mete out heavy fines against offenders.”
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