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Source: www.asiaecon.org |

TAIWAN UNABLE TO REACH A FREE TRADE AGREEMENT WITH CHINA


  Despite China's willingness to sign the Comprehensive Economic Cooperation Agreement (CECA) with Taiwan, which allows for free trade, the Taiwanese government has difficulty weighing political freedom with improving the islands slumping economy.   If signed, the CECA would allow the free flow of goods, services, and capital across the Taiwan strait, increasing interdependency among the two countries and possibility of unification of the two.


 

Despite China’s willingness to sign the Comprehensive Economic Cooperation Agreement (CECA) with Taiwan, which allows for free trade, the Taiwanese government has difficulty weighing political freedom with improving the islands slumping economy.

 

If signed, the CECA would allow the free flow of goods, services, and capital across the Taiwan strait, increasing interdependency among the two countries and possibility of unification of the two.

 

Taiwan’s economics minister Yiin Chii-ming said the island must sign a free trade agreement with China or risk a further decline in exports as regional trade blocs become the global norm. With Taiwan’s economy in recession, the economic administration of Taiwan is hoping that investment from the mainland will provide a boost to their shrinking Gross Domestic Product (GDP). Since China’s free trade agreement with 10 members of the Association of Southeast Asian Nations set to being 2010, Taiwan is under pressure not to be left out. With a free trade pact, Taiwan can bolster its recent 40 percent fall in exports as well.

 

The Taiwanese government is trying to downplay the political implications of the economic pact: a possible unification with China. Since the separation in 1949, China insists that Taiwan has and always will be an inseparable extension of the mainland, while Taiwan has maintained that it is a self-governing democracy.

 

Many believe that the new trade agreement will undeniably enhance economic conditions in Taiwan, but will deepen Taiwan’s dependency on China. Taiwanese President Ma Ying-jeou responded to questions regarding the union of the two countries saying, “We will take economic measures to solve economic problems with less politics and ideology. So far we have not seen any attempts by communist China to force Taiwan into doing things we cannot accept, and we wouldn’t have to accept it if they do so.”

 

Asked about Taiwanese criticism of the proposed agreement, a spokeswoman for china’s Taiwan Affairs Office down played the political aspect, insisting it was “purely an economic arrangement that stood to benefit both sides.”

 

Ignoring the political aspect as well, Mainland Affairs Council Vice Chairman Fu Dong-Cheng commented, “What we say is, economics is economics, and there’s no need to do too much analysis from the political perspective.”

 

Taiwan shouldn’t however ignore the political implications of signing the CEPA. Even if the government hopes to avoid disparagement by signing a CECA, this does not mean that Beijing won’t try to belittle Taiwan during the agreement. Chinese President Hu Jintao said late last year that China would only sign such an agreement with Taiwan based on the “one China” principle, therefore worries of political instability should not be dismissed.

 

More than 40 members of The Alliance of Referendum for Taiwan demanded yesterday that Straits Exchange Foundation Chairman, Chiang Pin-kung, participates in a public debate on the government’s plan to sign the CECA. An alliance representative commented, “if Taiwan signs a CECA under the “One China” principle, the agreement would symbolize Taiwan’s surrender to China. He added, “The signing of such an agreement will be an act of betrayal of the Taiwanese people”.

 

Members demanded that the public should decide by a national referendum whether or not the CECA should be signed.

 

A foundation official came out of the building to accept a written petition from the demonstrators.

 

Source: www.AsiaEcon.org
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Source: www.asiaecon.org |


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