Taiwan, China to negotiate signing trade agreement

By ANNIE HUANG

posted: 32 DAYS 16 HOURS AGO

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TAIPEI, Taiwan -Taiwan and China are expected to begin formal talks on signing a wide-ranging trade agreement by next spring or earlier after Beijing publicly sanctioned the negotiations, officials said Monday.

Liu Teh-hsiun, a vice chairman of Taiwan's Cabinet-level Mainland Affairs Council, said Beijing's "positive attitude" could help smooth discussions for the trade pact, which would deepen economic ties between the two countries.

On Sunday, China's Taiwan Affairs Office chief Wang Yi said the two sides could begin talks on the trade pact, known as the Economic Cooperation Framework Agreement, during a new round of bilateral talks later this year.

China is "willing to take into full consideration Taiwan's reasonable needs," and both sides should carefully assess the possible impact on certain industries to maximize benefits and minimize costs, he told a business conference in the western Chinese city of Chengdu.

A report by Taiwan's Economics Ministry says the island's economic growth rate could eventually increase by 1.6 percentage points under the framework agreement, adding 260,000 jobs in the industrial and service sectors.

A separate report by the Labor Council says in the first year or two, Taiwan could lose 80,000 jobs in labor-intensive sectors such as towels and toys but add 100,000 jobs in chemicals, plastics, textiles and machinery.

Taiwan and China have already started informal talks on the trade pact, and Taiwan wants to sign the agreement next spring. This was the first time a senior Chinese official has proposed a timeframe for it. The two sides split amid civil war in 1949.

Taiwan and China have scheduled their next round of high-level talks in Taichung, Taiwan's third largest city, for the middle or end of December.

The trade agreement would permit the free flow of many goods, services and capital between Taiwan and China. It would allow the island to keep its competitive standing in the region as Beijing is set to allow tariff-free imports from Southeast Asian countries as soon as next January.

Taiwan has said the pact will not include agricultural goods and will not allow the import of Chinese laborers.

Since China-friendly Taiwanese President Ma Ying-took took office 17 month ago, the two sides have signed a number of agreements, including financial cooperation and launching direct air and shipping links.

During informal talks on the trade pact, each side has proposed a list of goods to be granted tariff-free status in the initial stage, said Huang Hsien-lin, an official with Taiwan's Economics Ministry.

The framework agreement will proceed gradually and may take 10 years to complete in order to give struggling industries time to adapt, he said.

"We hope the trade pact will benefit both sides, so we can together gain a greater share of the global market" Huang said.

2009-10-26 03:40:55