Taiwan should not ignore global trend of economic integration: Cho
May 10, 2014, 12:00 am TWN
TAIPEI -- Taiwan, as a key player in the global economy, should not ignore the worldwide trend of economic integration, Vice Economics Minister Cho Shih-chao (卓士昭) said yesterday.
Both the Trans-Pacific Partnership (TPP) and the Regional Comprehensive Economic Partnership (RCEP) are important to Taiwan and will play a crucial role in the country's economic development, Cho said in his opening remarks at an international forum on the service industry.
The output of Taiwan's service industry could fall by US$1.9 billion if the country fails to join the TPP, but could increase by US$8.58 billion if it becomes part of the economic bloc, he said.
Although services account for 70 percent of Taiwan's gross domestic product, they make up only 1 percent of the global market, Cho said.
"There is plenty of room for Taiwan to develop," he added.
Taiwan should open up its services market more, which could help upgrade its industries, increase output and create jobs, Cho said.
Wu Chung-shu, president of the Chung-Hua Institution for Economic Research, echoed Cho's views, saying that Taiwan should speed up its efforts to participate in regional economic integration.
"Lacking natural resources, Taiwan can only develop and extend its reach overseas in a more active and positive way," he said at the forum.
"No matter which regional economic bloc Taiwan aims to join, the island will have to deal with China," Wu cautioned, alluding to the recent mass protests against a trade-in-services agreement between Taiwan and China. In March, student-led protesters occupied the Legislative Yuan for 24 days and thousands of demonstrators took to the streets to show their concern over the pact.
The economist said China, now the world's second-largest economy, is expected to become the biggest by 2025 and plays a significant role in the global market.
Taiwan should find a way to cooperate with instead of turning its back on China, he said.
"The service sector is people-oriented, so Taiwanese, who are known for their amicability, should have great faith in themselves," Wu said.
Taiwan can use the agreements with China as "training" in preparation for possible participation in the TPP and the RCEP, he suggested.
The one-day forum was organized by the CIER and the Taiwan Coalition of Service Industries.
The TPP currently is being negotiated by the U.S. and 11 Pacific Rim nations, namely Japan, Australia, Peru, Malaysia, Vietnam, New Zealand, Chile, Singapore, Canada, Mexico and Brunei.
The RCEP is being negotiated by all 10 members of the Association of Southeast Asian Nations, along with China, India, Japan, South Korea, Australia and New Zealand.
Taiwan has repeatedly reiterated its desire to join the two trade blocs to avoid being economically marginalized in the region.