TAIPEI (Taiwan News) -- Australia has balked at signing a free trade agreement (FTA) with Taiwan out of fear of offending China for several years now, reported The Australian Financial Review.
Plans to sign a FTA with Taiwan have been on hold since Australia signed one with China in 2015 and it decided that it would be "polite to leave an elegant distance between the deal with mainland China and doing a deal with Taiwan," according to a source cited in the report.
Last week, Australian Liberal Democratic Party senator David Leyonhjelm asked the government about the status of the FTA with Australia, years after a conversation with former trade minister Andrew Robb in which he "advised me that such an agreement was on the agenda." A month or so after he posed the question again to Robb's staff, he was told that the delay was due to ongoing negotiations on FTAs with other countries, but he was assured "there would be an agreement in due course."
Leyonhjelm was later told that there were concerns that pushing forward with the Taiwan FTA could jeopardize a "more lucrative deal with Hong Kong." Since the China FTA, Australia has been busily working on deals with Hong Kong, Indonesia, the European Union, the Pacific Alliance, as well as trying to resuscitate the Trans Pacific Partnership trade agreement nixed by Trump.
When government Leyonhjelm asked Senate leader George Brandis to provide an update on the status of the FTA with Taiwan, he dodged the question by praising the current status quo in terms of trade with Taiwan becoming Australia's 8th largest export market in 2016-17 and its 14th largest trading partner overall in 2016.
Brandis then said that the Australian was open to the possibility of exploring improved market access and economic ties with Taiwan, but added "Any arrangements Australia concluded with Taiwan would be consistent with our One China policy."
(Screen capture of photo of Leyonhjelm from The Australian Financial Review article)
Out of frustration with what he sees as Canberra's kowtowing to Beijing, Leyonhjelm told the Financial Review:
"Taiwan is a free and democratic country, subject to the rule of law. China is none of these. At the very least, Australia's dealings with Taiwan should be no less positive than our dealings with China. Given we have a FTA with China, we should obviously have one with Taiwan, too.
"I'm concerned that the government has caved in to pressure from China and that an FTA with Taiwan is no longer on the agenda. While trade with China will always be greater, we should not abandon our values and principles."
Neighboring New Zealand, on the other hand, signed an FTA with Taiwan in 2013, and exports increased nearly 25 percent the following year, reported The Australian.