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Think tank urges Taiwan to enhance ties with trade partners (update)

2012/06/08 17:18:43

Taipei, June 8 (CNA) In addition to seeking to sign trade pacts with various partners, Taiwan should strengthen substantial relations with such partners, a local economic think tank said Friday.

During the process of developing trade, signing a trade accord is important but can be a slow process, and therefore, having actual engagement and cooperation is more important, said Wu Chung-shu, president of the Chung-Hua Institution for Economic Research.

"As Taiwan enjoys close relations with Japan and China, the European Union, which wants to further develop trade with China, has shown great interest in cooperating with Taiwan," Wu told reporters on the sidelines of an international conference.

"Taiwan plays an important and critical role," Wu said, adding that the country should continue upgrading its industry and moving toward liberalization.

Since Taiwan inked its Economic Cooperation Framework Agreement with China in June 2010, it has been looking to engage in free trade agreements with other nations to counter rival South Korea's moves to sign free trade pacts with the United States and Europe, and possibly China and Japan in the future.

Taiwan has been active in talks with its major trade partners in this regard.

Meanwhile, Patrick Messerlin, director of the Paris-based Groupe d'Economie Mondiale at Sciences Po, echoed Wu's remark, describing Taiwan as one of the best entrances into China's market.

Although Taiwan is a medium-sized economy in terms of gross domestic product, its economic scale is about half the size of India's scale if firms operating in China are included, he said during his keynote speech, titled "The EU, Taiwan and the Mega Trade Agreements in East Asia."

However, if Europe and Taiwan want to start trade pact negotiations, China would still loom behind as an underlying third party despite the warming Taiwan-China ties, Messerlin said.

He suggested that Taiwan can follow the approach adopted by South Korea and start with small areas and issues, like "piling up bricks," instead of a pact as a whole.

The negotiations for an EU-South Korea free trade agreement were launched in May 2007, with both sides officially inking the pact Oct.6, 2010 after eight rounds of talks.

In addition, the scholar pointed that what concerns Europe most is the Trans-Pacific Partnership (TPP) pact, a multilateral free trade agreement that is being negotiated by Australia, Vietnam, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and the United States.

"It is like the WTO (World Trade Organization) version 2.0," he said, adding that such regional integration will pose a threat not only to Europe but also to other countries that are left out.

"The TPP is discriminating very much against us," he noted.

(By James Lee)