More ECFA talks needed to reduce China-S. Korea FTA threat: scholars
CNATAIPEI--Taiwan should accelerate follow-up talks with China over a bilateral economic pact to reduce the adverse impact of a free trade agreement (FTA) between China and South Korea on Taiwanese exports, according to advisers to Taiwan's Mainland Affairs Council (MAC).
April 8, 2012, 12:00 am TWN
As South Korea is now preparing to conclude an FTA with China, Taiwan should speed up negotiations with China to expand mutual tariff concessions under the bilateral economic cooperation framework agreement (ECFA), members of the MAC's advisory committee said at a recent meeting.
Under the ECFA's early harvest program, Taiwan and China have mutually agreed to reduce and gradually eliminate tariffs on many industrial and agricultural items, but there are still many other products not covered in the list. The ECFA effect could be offset by a China-South Korea FTA since Taiwan and South Korea are export competitors in China, the biggest export destination for both countries.
The MAC, a Cabinet-level body responsible for charting the government's policy toward China, called the meeting recently to solicit its advisers' opinions about possible economic impact on Taiwan of China-South Korea FTA talks next month.
In addition, many scholars worried that a China South Korea FTA might pose a strong threat to Taiwan's efforts in soliciting foreign investment and urged the government to come up with a rescue plan.
Part of that solution, according to some experts, could be a further push for industry upgrade that helps domestic vendors turn original equipment manufacturing (OEM) into their own branding companies.
Further, the committee cautioned against the shaping of a possible China-Japan-South Korea free trade bloc, which could bring even more destructive challenges to Taiwan.
They said it is because such a partnership is expected to pave the way for an “ASEAN (Association of Southeast Asian Nations) plus Three” free trade zone, which could further marginalize Taiwan in the region.