China's suspension of Taiwan tariff exemptions targeted, limited: Expert

Taipei, Sept. 19 (CNA) China's decision to suspend tariff exemptions on a range of imported Taiwanese agricultural products is intended to pressure Taiwan in a way that is both targeted and limited in scope, a trade expert told CNA Thursday.

The policy, announced by China's Ministry of Finance on Wednesday, will suspend tariff-free treatment on imports of 34 types of fruit, vegetable, and aquaculture products from Taiwan, with effect from Sept. 25.

Beijing claimed the move was in response the pro-independence stance and "provocative actions" of Taiwanese authorities. Taiwan, meanwhile, denounced the policy as a form of "economic coercion."

Asked about the policy, Chang Hung-yuan (張弘遠), an associate professor from the International Trade Department at Chihlee University of Technology, said Beijing likely wanted to respond to "antagonistic" remarks made by President Lai Ching-te (賴清德) recently.

As examples, Chang cited Lai's speech last week at a symposium marking the 60th anniversary of the Declaration of Formosan Self-Salvation, as well as his claim in an interview that if Beijing is serious about "territorial integrity," it should also take back land that China ceded to Russia in the 19th century.

"China needed to find a way to pressure Taiwan to express its displeasure," Chang said, noting that Beijing's frequent military incursions around Taiwan are "not directly felt" by ordinary people.

At the same time, the move couldn't be so severe that it would scare off private investment from Taiwan, Chang said.

In that sense, he said, the decision to target agricultural products was intended to exert pressure, but in such a way that it had a "limited scope of impact" and was not "overly escalatory."

Despite its limited impact, Chang argued, the policy showed signs of being carefully targeted.

For example, Beijing "purposely" waited until after the Mid-Autumn Festival to resume tariffs on pomelos -- one of the 34 affected products -- which are traditionally eaten during the holiday, Chang said.

This also came just weeks after China lifted a ban on pomelo imports from Hualien County, but not the rest of Taiwan, Chang said, adding that such locally-targeted trade measures are also a relatively recent phenomenon.

Meanwhile, Yang Min-hsien (楊明憲), a professor in Feng Chia University's Department of International Business, said that as members of the World Trade Organization, both China and Taiwan should adhere to WTO principles that promote trade without discrimination.

In the past, China has at times unilaterally offered trade favors to Taiwan (without doing so for other countries), which Taiwan has "welcomed" as a means of increasing its agricultural exports, Yang said.

"In fact, we shouldn't be disregarding these established international trade norms," he said.

In the case of China's recent axing of tariff exemptions, Yang said it had not come out of the blue, since Beijing previously suspended imports of various types of Taiwanese agricultural products.

As such, Taiwan's government should be relatively well-prepared, and will likely continue its efforts to spread risk by diversifying export markets for agricultural products, Yang said.