Service trade pact delay blunts Taiwan's edge: economists
CNATAIPEI -- The Legislative Yuan's foot-dragging in ratifying Taiwan's service trade pact with China will blunt Taiwan's trade edge as South Korea, the island's trade rival, is reportedly to complete its free trade talks with China soon, said economics officials.
September 23, 2013, 12:03 am TWN
Three months after its completion on June 21, Taiwan's service trade pact with China is still bogged down at the Legislative Yuan, mainly because of the opposition Democratic Progressive Party's (DPP) filibuster which brought into question whether the pact will take effect early next year, as scheduled.
Economics officials were concerned about the threat by DPP lawmakers to review the pact clause-by-clause because it will cast doubt upon the administration's ability to conduct trade talks with other trade partners and may undermine the island's chances to join the Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership.
Taiwan is set to be shoved to the sidelines should it be excluded from these vital trade pacts, said the economics officials.
The issue is all the more urgent in light of the fact that South Korea has already concluded more than 40 free trade pacts in the last few years, and is engaging in similar trade talks with China, which is one of Taiwan's major export markets, said the officials.
The reports that Seoul has almost completed its talks with Beijing set Taiwan's economics officials on edge because of concerns that the South Korean trade pact may erode Taiwan's hard-earned edge against South Korea in the Chinese market.
They also worried that the edge Taiwan received from its pact with China would be lessened because of the Legislative Yuan's procrastination in ratifying the pact.
These concerns were shared by Roy Chun Lee, a research fellow at the Chung-Hua Institution for Economic Research, who said the later the pact takes effect, the less advantage it brings to Taiwan.
Opening up the market to overseas competitors is a worldwide trend which will benefit Taiwan's entire economy in general, although some specific businesses may suffer, noted the economics officials.
Given the fact that Taiwan is an export-oriented economy, the officials said, there is no question that the country will benefit from opening its markets.