Following the signing of a free trade agreement (FTA) between mainland China and South Korea today, Executive Yuan Spokesperson Sun Lih-chyun called for the Legislature to swiftly approve a cross-strait agreement monitoring framework and the Cross-Strait Agreement on Trade in Services.
He also stated the government would step up publicity and communication about the services pact and accelerate negotiations with mainland China on a cross-strait agreement on trade in goods.
The mainland China-South Korea FTA is extremely worrying because South Korea is Taiwan's main competitor and the mainland is Taiwan's biggest trading partner, Sun stated. Moreover, numerous other nations are competing with Taiwan for the mainland Chinese market. For these reasons, advancing cross-strait economic and trade relations remains a Ma administration priority.
The extent and model of South Korea's economic development are similar to Taiwan's. The ROC's and South Korea's industrial configurations are alike, with 77 percent similarity in terms of commodity trade structures. Both nations focus on exports; foreign trade accounts for more than 70 percent of each economy's growth.
However, by signing FTAs with 50 countries to date, South Korea has given its products a competitiveness edge over Taiwan in major markets worldwide, such as mainland China, the United States, and the European Union, Sun warned. In addition, South Korea has already entered Trans-Pacific Partnership (TPP) negotiations.
The Executive Yuan is thus appealing again to the Legislature for quick passage of the monitoring bill and services pact, which have thus far been delayed. If these measures are not approved, Taiwan's industries and economic development will suffer a serious blow once the South Korea-mainland China FTA takes effect, Sun predicted.
Given the influence regional economic integration could have on the global economy and supply chain and the need to catch up with South Korea by ameliorating the negative effect of its FTA with the mainland, the government will also do its utmost to accelerate the negotiation and completion of the cross-strait goods pact to give Taiwan the best possible market opportunities.
Meanwhile, relevant government agencies must make a total effort to accomplish the following, the spokesperson said:
- Accelerate the completion of economic cooperation pacts currently being negotiated.
- Promote the ROC's accession to the Regional Comprehensive Economic Partnership and TPP as well as the commencement of new bilateral FTA negotiations.
- Accelerate reforms to liberalize and facilitate the nation's economic and trade systems.