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Economic Daily News: The case for cross-strait free trade zones

Economic Daily News: The case for cross-strait free trade zones

Even though cross-Taiwan Strait relations have vastly improved since President Ma Ying-jeou came to office in 2008, the fact remains that for the last 20 years, Taiwanese businesses have not been able to fully exploit the opportunities presented by China's enormous market. Two developments would help remove some of the barriers in cross-strait trade and economic relations, namely the stalled trade-in-services agreement and the legislation to set up free economic pilot zones in Taiwan. But there is no knowing when these two measures will finally be adopted given the concern among local businesses about fierce competition from Chinese companies and efforts by opposition politicians to exploit that fear. Removing that fear has now become the only way forward, and the only way to achieve that in the short term is to set up an experiment in a closed environment that would not allow any result to spill over to the world outside. Things can change only when and if the people, seeing the results of the experiment, realize that their suspicions were unfounded and that unlimited opportunities will disappear unless they are seized upon quickly. Obstruction of further cross-strait economic cooperation would then turn into support for the initiatives to deepen economic ties between the two sides. First, we propose connecting Taiwan's proposed pilot zones with similar programs in China so that the two sides can work together in the world market. To ease concerns that Taiwan's economy would be "locked into" China's larger economy with less chance of signing free trade agreements with other countries, we suggest that Taiwan follow Singapore's example and unilaterally lower its tariffs and remove non-tariff barriers. Taiwan can do so in some enclosed locations as an experiment, which is in fact the purpose of setting up the pilot zones in the first place. (Editorial abstract, July 26, 2014)


Updated : 2021-01-23 07:06 GMT+08:00