bureau of foreign trade, moea mar.16, 2010 challenge vs opportunity -- tasks and prospects in...

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Bureau of Foreign Trade, MOEA Mar.16, 2010

Challenge vs Opportunity -- Tasks and Challenge vs Opportunity -- Tasks and

Prospects in Signing ECFAProspects in Signing ECFA

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I. Preface

II. Possible Effects of Signing ECFA

III. Most Recent Progress in Promoting ECFA

IV. Early Harvest Program and Government

Measures for Vulnerable Industries

Outline

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1. Change of Cross-Strait Relations before &

after May 20, 2008

2. Challenges to Taiwan’s Trade Development

3. What We Confronted / will Confront

I. Preface

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after May 20, 2008

From divergence to convergence

From confrontation to negotiation

From antagonism to cooperation

I. Preface

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after May 20, 2008

Look squarely at reality,

Build mutual trust,

Put aside disputes,

Create a win-win situation

I. Preface

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The talks between Chiang Pin-kung, Chairman of Taiwan’s Straits Exchange Fo

undation (SEF), and Chen Yunlin, Chairman of mainland China’s Association fo

r Relations Across the Taiwan Strait (ARATS)

Results of the Chiang-Chen talks

The first round of talks :June13 , 2008

Signed the “Minutes of Talks on Cross-Strait Charter Flights” and “Cross-Strait Agreement on Travel by Mainland

Residents to Taiwan”(1)

The fourth round of talks :December 22, 2009

Three agreements on agricultural product inspection and quarantine(10); cross-strait cooperation on industrial product standards(11), inspection and certification; as well as on fishing crew collaboration(12).

The third round of talks :April 26 , 2009

The two sides completed and signed agreements on joint crime-fighting(6) and mutual judicial assistance, cross-strait financial cooperation(7), and regular cross-strait flights(8). They also reached a consensus on matters pertaining to promoting mainland investment in Taiwan(9).

The second round of talks :NOV. 4 , 2008

Confirmed the content of the four agreements on

cross-strait air transport(2), sea transport(3),

postal services(4), and food safety(5)

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I. Preface

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0.0

100.0

200.0

300.0

400.0

500.0

600.0

1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009

Trade Milestones in Taiwan: Taiwan’s foreign trade turned a surplus for the first time in 1971; Taiwan’s foreign trade value exceeded US$100 billion in 1988 and exceeded US$200 billion in 1995. Total trade value has continued to grow rapidly since 2003, exceeding US$300 billion in 2004, exceeding US$400 billion in 2006 and exceeding US$496 billion in 2008, which was more than 120 times greater than in 1971, thus becoming the 18th leading exporter in the world.

Rapid Growth in Trade

Data Source : DGBAS, R.O.C. ;WTO

TAIWAN TOTAL TRADE VALUE TAIWAN TOTAL TRADE VALUE

19713.9

2. Challenges to Taiwan’s Trade Development Taiwan’s trade performance over the years

2008496.1

1988 110.2

1995 217.3

2004 351.1

2006 426.7

2007 465.9

2009378.4

(Unit: US$ billion)

Ranking Country

1 Germany

2 China

3 US

4 Japan

5 Netherlands

6 France

12 South Korea

13 Hong Kong

14 Singapore

15 Saudi Arabia

16 Mexico

17 Spain

18 Taiwan

2008 Ranking of GlobalExporters in Merchandise

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Due to the rapid slowdown in the international economy caused by the global financial tsunami, Taiwan’s exports have declined for eleven consecutive months since Sep. 2008. According to the latest export performance, the worst situation ended in the 4th quarter of 2009 with exports amounting to US$59.8 billion, an increase of 8% compared with the previous 3 quarters of consecutive growth; though it hasn’t fallen back to the 2008 level .

0

5

10

15

20

25

30

-60

-40

-20

0

20

40

60

80

100

Export value Growth rate

Export value 22.1 17.6 24.2 22.6 23.6 24.3 22.9 25.3 21.9 20.8 16.8 13.6 12.4 12.6 15.6 14.8 16.2 17 17.3 19 19.1 19.8 20 20 21.8

Growth rate 11.8 18.3 22.7 13.9 20.5 21.2 7.9 18.2 -1.6 -8.3 -23.3 -41.9 -44.1 -28.6 -35.8 -34.3 -31.5 -30.4 -24.4 -24.6 -12.7 -4.7 19.3 46.9 75.8

2008Jan.

Feb. Mar. Apr. May Jun. Jul.Aug

.Sep

.Oct. Nov. Dec.

2009Jan.

Feb. Mar. Apr. May Jun. Jul.Aug

.Sep

.Oct. Nov. Dec.

2010Jan.

Severe plunge in Taiwan’s exports since Sep. 2008

Unit: US$ billion; %

Data source: Taiwan Directorate General of Customs


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US48.1%

Japan11.3%

Others16.6%

ASEAN-66.0% Hong Kong

8.3%

Europe9.7%

1985US$30.8 billion

Data source: Taiwan Directorate General of Customs; Compiled by the BOFT

US11.6%

Japan7.1%

Others14.3%

ASEAN-614.8%

MainlandChina & Hong

Kong41.1%

Europe11.1%

Europe17.8%

MainlandChina & Hong

Kong23.2%

ASEAN-616.4%

Others7.6%

Japan8.4%

US26.6%

1998US$110.6 billion

Taiwan’s major export destinations have shifted to China Taiwan’s major export destinations have shifted to China

2009US$203.7 billion

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0

20

40

60

80

100

120

140

Taiwan's Share of Trade in GDP from 1998 to 2009

TOTAL TRADE 77.9 77.7 89.8 80.3 83.5 91.2 106.1 107.4 117.1 121.6 126.6 99.7

EXPORT 40 40.7 46.2 43.3 45.5 49.3 55.1 55.9 61.5 64.4 65.2 53.7

IMPORT 37.9 37 43.6 37 38.0 41.9 51.0 51.5 55.6 57.2 61.4 46

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Data Source: DGBAS, R.O.C.


Unit :%

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Taiwan is an export-oriented economy and foreign trade has played a vital role in Taiwan's economic development over the past years. Taiwan’s trade contribution has accounted for around 60-70% in recent years, showing the importance of trade in Taiwan's economic development.

Trade contribution to Taiwan's economic growth

Data source ： Directorate General of Budget, Accounting and Statistics, Executive Yuan

Note: The economic growth rate in 2001 and 2009 are negative, hence the contribution can not be calculated.

1999 5.97 2.70 3.27 -0.67 0.57 -0.46 3.27 5.70 2.43 54.77

2000 5.80 5.65 3.03 0.19 2.07 0.36 0.15 9.01 8.86 2.59

2001 -1.65 -6.21 0.62 0.27 -5.18 -1.93 4.56 -4.73 -9.29 -----Note

2002 5.26 2.84 2.12 0.24 0.27 0.22 2.42 5.81 3.39 46.01

2003 3.67 2.37 1.85 -0.18 -0.02 0.72 1.30 5.53 4.23 35.42

2004 6.19 7.34 3.27 0.08 3.12 0.88 -1.15 8.86 10.01 -18.58

2005 4.70 1.85 1.81 0.03 0.64 -0.63 2.86 4.86 2.00 60.85

2006 5.44 0.95 0.92 -0.09 0.02 0.10 4.49 7.34 2.85 82.54

2007 5.98 1.34 1.23 0.25 0.12 -0.27 4.65 6.49 1.85 77.76

2008 0.73 -1.54 -0.33 0.08 -2.36 1.07 2.27 0.40 -1.88 310.96

2009 -1.87 -3.34 0.83 0.42 -2.20 -2.39 1.48 -6.47 -7.94 -----Note

Sub-totalExports ofGoods andServices

Less:Imports ofGoods andServices

Demand of Rest of The World

Tradecontributionto Taiwan'seconomic

growth

Private FinalConsumption

GovernmentFinal

Consumption

Item

Period

EconomicGrow th

Rate(yoy)

Sub-total

Domestic Demand

Gross FixedCapital

Formation

Increase inStocks


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I. Preface

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Taiwan acceded to WTO as a formal & full

member on Jan. 1, 2002

WTO Rules:

Standstill

MFN

National Treatment

Transparency

I. Preface

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Turbulence

FTAs/RTAs Exceptions to MFN Rules

266 FTAs/RTAs are currently in effect, of

which 41 are signed by Asian countries.

Taiwan has signed 4 FTAs with 5 countri

es, which account for only 0.187% of our

global exports.

I. Preface

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Southern Common Market

(MERCOSUR)

North American Free Trade Area（ NAFTA）

Establishing Free Trade Area of the Americas (FTAA)

EU-Mexico Free Trade Area

European Union (EU)

ASEAN-JapanComprehensive Economic

Partnership Agreement(set to lower tariffs on most

goods to 0% in 2018)

ASEAN-South Korea Free Trade Area(set to lower tariffs on most goods to

0% in 2010)

Japan-SingaporeNew Age Economic

Partnership Agreement

ASEAN-India

ASEAN-Australia + New Zealand Free Trade Area

Signed Feb. 27, 2009Entered into force July 1, 2009

China-Hong Kong-MacaoCloser Economic

Partnership Arrangement (CEPA)ASEAN Free

Trade Area (AFTA)

US-South Korea FTA

CAFTA－ DR

Delay in concluding WTO Doha Round has caused the spread of international bilateral FTAs and accelerated the deepening of regional economic integration in the world.

EU-South Korea

ASEAN-China Free Trade Area (set to lower tariffs on most

goods to 0% in 2010)

The Trend and Present State of Acceleration of Economic Integration

The Trend and Present State of Acceleration of Economic Integration

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Taiwan’s world ranking and share of exports and imports over this past decade

Amount Ranking Share Amount Ranking Share Amount Ranking

1999 121.6 14 2.2 110.7 15 1.9 232.3 15

2000 148.3 14 2.3 140.0 15 2.1 288.3 14

2001 126.3 14 2.0 108.0 16 1.7 234.3 16

2002 135.3 14 2.0 113.2 16 1.7 248.6 15

2003 150.6 15 2.0 128.0 16 1.6 278.6 15

2004 182.4 17 2.0 168.8 16 1.8 351.1 16

2005 198.4 16 1.9 182.6 16 1.7 381.0 16

2006 224.0 16 1.9 202.7 16 1.6 426.7 17

2007 246.7 16 1.8 219.2 17 1.5 465.9 17

2008 256.0 18 1.6 240.0 18 1.5 496.0 17

Total Trade Amount ImportsExports

Data source：WTO International trade statistics annually

Unit： US$ billion;%

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ASEAN + China FTA1 Jan. 2005, began implanting tariff reductions on

goods.

1 Jan. 2010, zero tariff on most goods.

ASEAN + South Korea FTA1 July 2007, began implementing tariff reductions

on goods.

1 July 2010, zero tariff on 90% of goods.

Impact in 2010

I. Preface


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I. Preface

Countries Dates Terms

ASEAN + India FTA

Will enter into force Mar. 2010

Between 2013 and 2016, mutual reduction of import tariffs on 80% of goods.

ASEAN + Japan EPA Dec. 2008 By 2018, zero tariff on

91% of goods

Japan + Vietnam EPA Oct. 2009

By 2019, zero tariff on 92% of total bilateral trade goods.

ASEAN + Australia & New Zealand FTA

Jan. 2010 By 2020, zero tariff on 96% of goods.

Impact in the next 10 years

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Countries Dates Terms

South Korea + USA FTA

Signed Jun. 2007.

Pending approval of respective National Assemblies.

95% of S. Korean and USA industrial and consumer goods will be exempt from tariffs within 3 years of FTA implementation.

South Korea + EU FTA

To be signed in Q1 2010.

(Initialed 15 Oct. 2009)

South Korea + India FTA

Entered into force

1 Jan. 2010.

India commits to tariff cuts/exemptions for 85% of S. Korean goods.

S. Korea commits to tariff cuts/exemptions for 93% of Indian goods.

Impact in the next 10 years

I. Preface


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Potential effects of future East Asia FTAs/RTAs

FTAs/RTAs currently under study

ASEAN+3 (mainland China+Japan+Korea)

ASEAN+6 (mainland China+Japan+Korea+ Indi

a+Australia+New Zealand)

Mainland China+Japan+Korea

Korea+China FTA (5 joint studies completed as

of June, 2008)

Free Trade Area of the Asia Pacific (FTAAP)

I. Preface


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The future options

For political reasons, we haven’t yet had an

y positive response from “target trading par

tners” to our endeavor in promoting bilatera

l FTAs.

Work on the Cross-strait ECFA?

I. Preface

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II. Possible Effects of Signing ECFA

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Improve Macroeconomic Scale (1/2)

Effects of signing ECFA: Macroeconomy (dynamic analysis)

Scenario

Item

Scenario 1 Scenario 2

GDP (%) 1.65 1.72

Exports (%) 4.87 4.99

Imports (%) 6.95 7.07

Trade condition (%) 1.42 1.41

Social welfare(US$ million)

7,710.90 7,771.00

Trade balance(US$ million)

1,757.90 1,779.40

Total production(US$ million)

28,004.73 28,884.20

Resource: GTAP 7.0 database, “Evaluation on the Impact of ECFA,” CIER, 2009.06Scenario 1: Maintain current restrictions on agriculture and industry sectors, liberalize items now open to import, and have zero tariff for all Chinese goods. Scenario 2: Maintain import restrictions and do not reduce tariffs only in the agriculture sector; eliminate tariffs and fully liberalize import of industrial items.

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Simulated Scenario

Employment

(default)

Scenario 1 Scenario 2

Percent change

Persons Percent change

Persons

10,100,720 2.6 257,286 2.6 263,100

Agriculture

(1-32)716,218 1.7 12,288 1.7 11,951

Manufactg.

(33-112)1,890,890 1.4 25,961 1.5 28,105

Services

(113-161)7,493,612 2.9 219,037 3.0 223,044

Effects of signing ECFA: employment (dynamic analysis)

Note: The employment numbers in each industry are estimates based on employment table 2006 published by the Directorate-General of Budget, Accounting and Statistics.

Resource: “Evaluation on the Impact of ECFA,” CIER, 2009.06

Note: The employment numbers in each industry are estimates based on employment table 2006 published by the Directorate-General of Budget, Accounting and Statistics.

Resource: “Evaluation on the Impact of ECFA,” CIER, 2009.06

Improve Total Employment (2/2)

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Gain Larger Savings Margin on Tariffs than China(1/2)

Possible effects of tariffs (based on 2008 performance) (1/2)

Currently:China sets no special limitation on Taiwan products; its average tari

ff on industrial goods is 9%. – Taiwan’s exports to China (including Hong Kong) have reached US$

100 billion (tariffs amount to US$9 billion)

Taiwan maintains restrictions on 1,300 industrial and 834 agricultural goods with the average tariff on industrial goods at 4%.

– China’s exports to Taiwan are valued at US$35 billion (tariffs amount to US$1.4 billion)

We ran a US$65 billion trade surplus; Taiwan’s tariff burden exceeded China’s by US$7.6 billion.

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Gain Larger Savings Margin on Tariffs than China (2/2)

Possible effects of tariffs (based on 2008) (2/2)

If both sides eliminate tariffs after signing ECFA and exports for both sides grow by 20%, then:

Export growth Tariff elimination

Taiwan:Exports to China will increase US$120 billion China:Exports to Taiwan will increase US$42 billion

Taiwan’s trade surplus will expand US$78 billion

Taiwan:Will save US$10.8 billion in tariff expenditure China:Will save US$10.8 billion in tariff expenditure

Taiwan gains more!

We will benefit more from the export expansion since China has larger market scale than we do.

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Deepen Relations b/w Taiwan and Major Trade Partners Expected

FTAAP

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Create Taiwan’s Advantages in Services Trade

In addition to trade in goods, ECFA can also provide numerous benefits to Taiwan’s services trade by helping foreign businesses invest in Taiwan as well as Taiwan businesses investing in China.

In the Early Harvest List, Taiwan would like to request “market access” commitments from China in the financial and banking sectors for example, by reducing regulations on Taiwan banks setting up branches in China, restrictions on asset thresholds, and requirements for 3 consecutive years of profits. This will not only provide financial services to Taiwan businesses in China, but also help them resolve financial problems. Financially related domestic peripheral industries will also benefit while creating more employment opportunities.

The securities industry: Taiwan requests China to reduce restrictions on investments and investment advisory services by allowing Taiwan trusts to invest in China. This will enable China to raise capital for investing in Taiwan’s stock markets, increase business revenues, and enhance professional capabilities, which will benefit normal cross-strait financial business.

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Strengthen Taiwan’s Advantages in Terms of International Position (1/5)

Taiwan will enter the mainland Chinese market ahead of its main competitors.

ECFA will help convert the mainland from a production base to a core market for businesses in Taiwan.

Taiwan will become a priority cooperation partner and gateway for foreign businesses seeking to enter the mainland Chinese market.

ECFA will accelerate Taiwan’s development into a regional industrial operations center.

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Taiwan will enter the mainland Chinese market ahead of its main competitors. Tariffs on most industrial products exported from Taiwan to

China will be reduced to zero.

By getting in ahead of competitors like South Korea and Japan, Taiwan will replace their positions in that market.

Take petrochemical raw materials as an example. In 2007, China imported approximately US$76.3 billion, of which Taiwan accounted for 15%, South Korea 20%, and Japan 18%. If China’s average import tariff ( 6.17%) were reduced to zero, that would help Taiwan to win over Japan and South Korean’s combined market share (38%), worth approximately US$38 billion.

Strengthen Taiwan’s Advantages in Terms of International Position(2/5)

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ECFA will help convert the mainland from a production base to a core market for businesses in Taiwan.

Once the mainland reduces tariffs on most industrial goods to zero, it will help businesses to keep Taiwan on their supply chains and continue supplying their customers through the three links.

For instance, when the mainland reduces tariffs on scooter parts from approximately 10% to zero, the various satellite factories may choose to ship from Taiwan, since then they will benefit from the zero tariffs as well as the better quality of production in Taiwan.


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Taiwan will become a priority cooperation partner and gateway for foreign businesses seeking to enter the mainland Chinese market.

Taiwan provides: Ripple effects:

Help foreign companies

choose Taiwan as gateway

into China’s market Set up regional R&D,

production, or operation

centers Taiwan will be a first-choice

“global innovation center” and

“Asia-Pacific trading hub” for

multinationals.

Preferential tariffs for goods exported to China

Better IPR protections

The three links

Incentives for building R&D centers in Taiwan


Taiwan provides： Ripple effects：

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ECFA will accelerate Taiwan’s development into a regional industrial operations center.Effects of trade liberalization (three links, personnel

flows, lowered tariffs, removal of non-tariff barriers, etc.) will remake Taiwan into a multifunctional operations center with capabilities in transshipment, logistics, distribution, end-processing, etc.

Coupled with the relaxation of restrictions on China-bound investment, measures to encourage the return of Taiwan businesses to the domestic market will make Taiwan their “operational HQ.”


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International Views on ECFA (1/2)

American Chamber of Commerce 2009 Taiwan White Paper (May 2009)

We would also hope that the conclusion of this trade agreement with China would pave the way for Taiwan to participate in regional trade blocs and enter into bilateral FTAs with additional trading partners.

Japanese Chamber of Commerce & Industry, Taipei 2009 Taiwan White Paper Issue (October 2009)

If the ECFA comes into being, it should form a great opportunity for Taiwan and Japan to discuss signing an FTA. Therefore, this Chamber sincerely looks forward to progress being made in the ECFA negotiations.

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International Views on ECFA (2/2)

European Chamber of Commerce Taipei 2009-2010 Position Pap

er Overview (October 2009)

The sooner Taiwan signs the ECFA with China, the quicker political impediments to other countries (including the EU) signing economic agreements with Taiwan will be removed.

In order to revitalize Taiwan’s economy and increase trade, the ECCT recommends that the government seeks to sign an Economic Cooperation Framework Agreement (ECFA) with China and commit to Trade Enhancement measures with Europe as soon as possible. This will help to secure Taiwan’s position as an important link between China and Europe and reintegrate Taiwan into the global and regional economy.

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Make Taiwan a global center of innovation, an Asia-Pacific hub of economy and trade, and the headquarters for Taiwanese businesses.

Establish a stable cross-strait economic and trade cooperation framework; open a favorable cross-strait interaction mechanism.

Improve the basis of promoting Taiwan’s opportunities to enter into bilateral FTAs with other countries and participate in regional economic and trade cooperation.

Prospects for Cross-Strait Economic

and Trade Cooperation

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Cross-strait links will ease the bottleneck of participating in regional cooperation

Promote dynamic modifications in cross-strait economic and trade relations

Integration of business opportunities in global and mainland markets

• Facilitate cross-strait projects and cross-strait industry exchanges

• Expand cross-strait direct flights• Open Taiwan’s production enterprises to

Chinese investments• Loosen the 40% ceiling on investments in

China and other industry restrictions

Shanghai

Silicon Valley

Taipei

Dual Golden

Triangles of High-

Tech Industries

Tokyo Shanghai

Taipei

• Promote the ECFA• Sign FTAs• Join ASEAN + N

Possible Effects of Signing ECFA

Promoting Internationalization of Taiwan’s Economy, Trade and Investments

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III. Most Recent Progress in Promoting ECFA

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1.Steps Toward Signing the Agreement

Individual studies conducted by each side

Joint studies Negotiation Signin

g Send to legislatures for approval

Take effect

Latest Development: Joint study period is

completed, and the first formal negotiation was

held in Beijing on 26 January 2010.

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2.Achievements of the first round of formal negotiation (1/3)

Name of agreement

Basic structure of ECFA’s clauses

Rules and positions of “Early Harvest List

s” on goods and services

Arrangements for the next round of

formal negotiation

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2. Achievements of the first round of formal negotiation (2/3)

Name of agreement Each side agreed that the tentative Chinese title is「海峽兩岸經濟合作架構 (框架 )協議」

The English title “Economic Cooperation Framework Agreement” (ECFA) may be used temporarily.

Basic structure of ECFA’s clauses Include market access on trade in goods, trade in services, r

ules of origin, early harvest lists, trade relief, dispute settlement, investment and economic cooperation

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2. Achievements of the first round of formal negotiation (3/3)

Early Harvest Lists

The two sides further discussed rules and positions on the early harvest lists on trade in goods and services; agreement not yet reached.

Arrangements for the next round

The two sides agreed in principle to hold the next round in Taiwan.

The Taiwan side aims to have ECFA signed at the 5th Chiang-Chen meeting in late May or early June.

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IV. Early Harvest Program and Government Measures for Vulnerable Industries

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Industries likely to benefit more:Both production and export increases for the plasti

cs, machinery, textiles, petroleum and coal products, and steel industries

Industries likely to be more adversely affected:Electrical machinery and electronic products: the n

egative outcome is due to the low cross-strait tariff rates (0.71% and 0.58% respectively) for those sectors, but assumptions in the model do not necessarily reflect the reality

Other transportation tools, and wooden products

1. ECFA’s Effects on Taiwan Industries

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2. Early Harvest Program (provisional) (1/2)

For trade in goods: Selection process:

The Ministry of Economic Affairs (MOEA) entrusted CIER to compile a preliminary detailed list by analyzing and screening trade statistical data and collecting industry opinion through questionnaires. Then, to reconfirm the opinions and demands from industrial sectors, the MOEA commissioned the Chinese National Federation of Industries (CNFI) to hold a public hearing on 8 January 2010 that was attended by its 152 member associations on the design of the early harvest list.

Selection principles: (1) Agricultural goods would not be included; (2) items for which

opening would be difficult would be excluded; (3) include items for which tariff reduction is urgent and apply tariff deductions that correspond to those in the Chinese market, e.g. ASEAN+1.

Plan:Provisionally, we will propose several hundred important product

items in the petrochemical, textile, machinery and components, automotive, and other industrial sectors.

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2. Early Harvest Program (provisional) (2/2)

For trade in services: Four principles:

Sectors that match our commercial interests (opportunities) and those in which Taiwanese companies have expressed demand (urgency)

Sectors that are unrestricted in FTAs between China and other WTO members (including the CEPAs) and sectors included in the service opening commitment list that China submitted to the WTO Doha round.

Sectors that are on the first stage open list (late June 2009) permitting mainland Chinese funds to enter Taiwan.

Sectors for which Taiwan’s degree of opening as pledged in the WTO is greater than China’s.

After several cross-sector discussions among services authorities, approximately ten service items are planned for proposal.

On 6 January 2010, a public hearing on “ECFA’s Effects on Service Sector Development,” was held by the MOEA and CNFI, during which MOEA further explained the above principles and solicited opinions, which were consulted and used to make revisions.

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3. Possible effects of early harvest on Taiwan

Trade in goodsThose listed in the early harvest program (e.g.

petro-chemicals, textiles) enjoy tariff exemption costs down profits rise However, some less competitive industries will

suffer, so that various government measures will be implemented.

Trade in servicesStrive for better-than-WTO treatment to gain

the advantage of market access in China

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Items not yet permitted for import from mainland China and those that primarily meet domestic demand will not be included on the Early Harvest list, or they will be included on the list of sensitive sectors, or the government will try in negotiation to exclude them from lower tariff or to get a longer period of adjustment for them. During the negotiation process, they would not be included on the “Early Harvest” list, or the government would try to get a more prolonged period of adjustment for them.

Include anti-dumping and safeguard measures in the negotiations, so that when domestic industries are affected by imports of large amounts of inexpensive products, relevant relief measures can be taken to reduce the impact.

Include a termination clause. If China does not abide by the agreement or special situations occur, we may notify China of termination of the agreement.

Strive for better terms during negotiation

4. Government Response Measures (1/3)

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To deal with the possible effects on industries and laborers, three supportive strategies will be adopted; total budget for the next ten years will be NT$95 billion.

Guidance on industrial upgradingProvision of SME loan guaranteesSupport for SME cluster developmentAssistance in export promotion

Guidance on industrial upgradingLow-interest loans for upgrading plants and equipmentEmployment assistance

Stimulus, guidance

Assistance for industrial transformation and new product line developmentAssistance for career changes

Adjustment

Damage relief

Implement a project to support industries’ adjustment to trade liberalization

4. Government response measures (2/3)

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Implement a project to strengthen guidance for industries adjusting to trade liberalization

4. Government response measures (3/3)

MOEA has already launched this project for industries that are domestic demand-oriented, less competitive, and easily affected by impact of trade liberalization. It includes:

1. Industry surveys, 1. Industry surveys,

strategic planningstrategic planning 1. Industry surveys, 1. Industry surveys,

strategic planningstrategic planning

2. Assistance for 2. Assistance for market expansion and market expansion and

promotionpromotion

2. Assistance for 2. Assistance for market expansion and market expansion and

promotionpromotion

3. Technical and 3. Technical and management management guidanceguidance

3. Technical and 3. Technical and management management guidanceguidance

4. Improved 4. Improved

occupational trainingoccupational training 4. Improved 4. Improved

occupational trainingoccupational training

Surveys to keep tabs on development status and problems facedSurveys to keep tabs on development status and problems faced Strategic planning on future development based on survey resultsStrategic planning on future development based on survey results

Surveys to keep tabs on development status and problems facedSurveys to keep tabs on development status and problems faced Strategic planning on future development based on survey resultsStrategic planning on future development based on survey results

Set up MIT quality mark certification systemSet up MIT quality mark certification system Assist businesses on domestic and foreign market expansionAssist businesses on domestic and foreign market expansion Organize joint MIT product fair activitiesOrganize joint MIT product fair activities

Set up MIT quality mark certification systemSet up MIT quality mark certification system Assist businesses on domestic and foreign market expansionAssist businesses on domestic and foreign market expansion Organize joint MIT product fair activitiesOrganize joint MIT product fair activities

Help businesses improve added-value by introduction of design estheticsHelp businesses improve added-value by introduction of design esthetics Use existing tech capabilities to provide timely tech assistance on Use existing tech capabilities to provide timely tech assistance on

upgrades to individual businesses to make them competitive more quicklyupgrades to individual businesses to make them competitive more quickly

Help businesses improve added-value by introduction of design estheticsHelp businesses improve added-value by introduction of design esthetics Use existing tech capabilities to provide timely tech assistance on Use existing tech capabilities to provide timely tech assistance on

upgrades to individual businesses to make them competitive more quicklyupgrades to individual businesses to make them competitive more quickly

Provide training for technical personnel in line with industry needs and Provide training for technical personnel in line with industry needs and improve quality of personnelimprove quality of personnel

Based on needs of industrial clusters or systems, provide training for Based on needs of industrial clusters or systems, provide training for cross-industry, multifunctional capabilities, to help resolve overall issuescross-industry, multifunctional capabilities, to help resolve overall issues

Provide training for technical personnel in line with industry needs and Provide training for technical personnel in line with industry needs and improve quality of personnelimprove quality of personnel

Based on needs of industrial clusters or systems, provide training for Based on needs of industrial clusters or systems, provide training for cross-industry, multifunctional capabilities, to help resolve overall issuescross-industry, multifunctional capabilities, to help resolve overall issues

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經濟部

Please visit the ECFA website (www.ecfa.org.tw)

ECFAHelping people to make a living, improving

Taiwan’s competitiveness

bureau of foreign trade, moea mar.16, 2010 challenge vs opportunity -- tasks and prospects in...

Documents

crossstrait relations

preface slide

crossstrait agreement

taiwans foreign trade

trade milestones

round of talks

crossstrait air transport2

crossstrait charter