GIO Minister updates U.S. forum and media on cross-strait economic pact

ROC Government Information Office Minister Johnny C. Chiang delivered a speech, “Taiwan—Building Partnerships for Asia-Pacific Economic Integration,” at the Carnegie Council for Ethics in International Affairs in New York on July 13. During his talk, he stressed that the signing of the Economic Cooperation Framework Agreement (ECFA) by Taiwan and mainland China represents a major step toward overcoming Taiwan’s economic isolation, achieving mutually beneficial cross-strait cultural, trade and investment cooperation and speeding up the economic integration of Asia.

Minister Chiang stated that signing the ECFA is only the first part of a longer process. Taiwan is a member of the WTO and has the right to sign FTAs with other WTO members, and President Ma Ying-jeou has already made FTA talks with Taiwan’s other trading partners an “administrative priority.” Now that the ECFA has been signed, there is no basis for the Chinese mainland hindering Taiwan from seeking to negotiate FTAs, he added.

During the subsequent question and answer period, Minister Chiang stated that the ECFA is an economic agreement that has nothing to do with politics. He noted that President Ma has vowed not to address such issues as independence or unification during his term of office. The President has said that building the cross-strait relationship is a very long process with no set timetable. Minister Chiang observed that over one million tourists from the Chinese mainland have visited Taiwan so far, and he is certain that they now know what democracy is. In his view, this is the optimal way to demonstrate what freedom is all about.

The GIO Minister began his weeklong U.S. visit on July 10, during which he visited such mainstream international media as Time magazine, The Wall Street Journal and Newsweek. He was also interviewed by Jayshree Bajoria of the U.S.-based Council on Foreign Relations.

In response to U.S. media concern about Taiwan’s request to purchase arms from the United States, Minister Chiang replied that mainland China habitually opposes the sale of weapons by the U.S. to Taiwan. However, Taiwan seeks to purchase such weapons not because of an arms race with the mainland but rather to safeguard the security of the people of Taiwan. Taiwan’s stance in cross-strait talks must be backed up with the power to defend itself, and a credible deterrence is essential to prevent any miscalculations that might result in military conflict. Taiwan’s security remains under threat; so, based on the government’s sovereign obligation to protect the Taiwan public, it must continue to purchase weapons of a defensive character from the U.S.

As for how the ECFA will affect Taiwan’s economy, Minister Chiang explained that, given the frequency of cross-strait economic and cultural exchanges, the ECFA was signed to initiate the institutionalization and liberalization of extant economic relations between the two sides of the strait. Currently, 41 percent of Taiwan’s exports go to mainland China and Hong Kong. Once the ECFA takes effect, 539 of Taiwan’s tariff items on the “early harvest list” will be subject to tariff reduction or elimination on the mainland, boosting Taiwan’s GDP growth by 0.4 percent.

Although mainland China is currently flush with capital, Taiwan-based businesses on the mainland nevertheless bring more than just investment capital to that market; they also possess such advantages as management skills, adaptability and keen market savvy. Thus, the ECFA, once it goes into effect, will boost the regional competitiveness of Taiwan’s industries.

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