President Ma Ying-jeou was accompanied by Vice Premier Eric Chu on the morning of April 17 in attending a seminar on the subject of a cross-strait economic agreement. The event was held at Hsyou Lang Elementary School in Taipei County. After making remarks, the president exchanged opinions with members of the public attending the seminar.
In his remarks, President Ma commented that trade between Taiwan and mainland China commenced over two decades ago. In 2003, when the Democratic Progressive Party was in office, mainland China became Taiwan's largest trading partner, he said. At the peak, trade between the two sides exceeded US$130 billion, which is an extremely large number, he said. While trade between the two sides has continued, he said, the government has had no way to effectively regulate it. As a result, shoddy or dangerous products sometimes reach the market. President Ma said that since assuming office, his administration has begun to regulate trade and has instituted food safety, product inspection and certification, and agricultural product quarantine and inspection measures, thereby reducing the possibility of such instances from recurring.
President Ma said that the government realizes that trade and investment ties with mainland China are now an immutable fact of life. Therefore, we need to be very pragmatic and meticulous in regulating these activities. Taiwan, he pointed out, has enjoyed quite a sizeable trade surplus in its trade with mainland China over the past 20-some years. The cumulative trade surplus now exceeds US$400 billion. Over the past several years, he said, Taiwan's overall trade surplus has been smaller than its surplus with mainland China. In other words, he said, if Taiwan did not engage in trade with mainland China, we would see our global trade balance fall into a deficit. This is a fact that cannot be denied, he said.
President Ma remarked that Taiwan is isolated diplomatically, and does not want to also be isolated economically. Therefore, we applied to enter the World Trade Organization in 1990, and we formally entered the organization in 2002, he said. The president said that this has been a boon for Taiwan, and cited statistics showing that Taiwan's imports and exports in 2001 totaled some US$220 billion. By 2008, however, this number had more than doubled to US$496 billion. Entering the WTO, he noted, has had benefits for Taiwan, but has also caused harm in certain respects. The president said that Taiwan's farmers have been hurt by the easing of import restrictions. However, the agricultural sector has responded well, and Taiwan's agricultural output has not declined; in fact it has increased to over NT$410 billion. In 2001, he said, output stood at some NT$350 billion, which means that over this period, output has risen 18.75%. While the number of farmers in Taiwan and the number of people in the agricultural sector have fallen by 170,000, the output value per farmer has risen. This shows that farmers have upgraded their products and technology, he said.
Responding to those who feel that Taiwan's participation in the WTO is sufficient and see no need to sign a cross-strait economic agreement with mainland China, President Ma said that the main modus operandi of the WTO is to engage in multilateral trade negotiations every few years, with the objective of discussing how to reduce tariffs and increase trade, he said. As of April 6 this year, he said, 273 free trade agreements had been signed throughout the world, with 58 of these being in Asia. When the DPP was the ruling party here in 2000, only three free trade agreements had been signed in Asia. As of last year, however, the number had increased by a factor of 19 to a total of 58 agreements, he said, and Taiwan and North Korea are the only two countries that have not been a party to any of these agreements.
President Ma said that former president Chen had made campaign pledges to liberalize direct transport links between the two sides of the Taiwan Strait and allow mainland Chinese tourists to visit Taiwan, but neither of these campaign promises was fulfilled during the eight-year DPP administration. On the other hand, President Ma pointed out that during his first year in office, his government implemented policies allowing mainland tourists to visit Taiwan. To this point, a total of 1.51 million mainlanders, including visitors, tourists, and business travelers, have come to Taiwan, with about 900,000 of the visits being for the purpose of tourism. These 1.51 million visits have generated some NT$87 billion in spending, contributing 0.49 percentage points to Taiwan's GDP, he said. This is not a small figure, he added, because Taiwan's economy last year was the second strongest of Asia's four little dragons, contracting 1.87%, as compared to the 2.0% contraction seen in Singapore and Hong Kong, and a figure of 0.2% in Korea. If not for the 0.49 percentage points contributed by the mainland visitors to Taiwan's economy, we would have been the weakest among the four. The president commented that growth in the number of overseas tourists here was derived not only from mainlanders. The number of tourists from Malaysia rose 73%, while an increase was also seen from Hong Kong, Macao, and the United States. For the year as a whole, tourist arrivals rose 14.3%, equivalent to an increase of 580,000 tourists. This was the best growth ever seen in this respect here, he said.
President Ma said that the Ministry of Economic Affairs has clearly explained what a cross-strait economic agreement will and will not entail. It will help the people of Taiwan engage in business and raise Taiwan's competitiveness. It will not open Taiwan's doors to laborers from the mainland, nor will it further liberalize imports of agricultural products from across the Taiwan Strait. It will, however, reduce customs tariffs. Consequently, it is actually Taiwan's exports to mainland China that will increase, and this will encourage foreign firms to invest in Taiwan. At the same time, the agreement most importantly will protect Taiwan's intellectual property rights, including copyrights, trademarks, and patents, he said.
As for the potential impact upon beleaguered traditional industries, the president said that the government reached an agreement in the most recent round of negotiations on this topic to reduce any such impact to a minimum. More negotiations will be held in the future, he added, with an eye to further minimizing negative impacts on local industry. However, should local industry be affected, the Ministry of Economic Affairs has budgeted NT$95 billion that can be spent over a 10-year period to help troubled industries adapt to the situation.
He said that if Japan and Korea sign a similar agreement with mainland China, Taiwan will be hard-pressed to compete with its neighbors. In fact, he said, the market share held by Taiwan industry in markets throughout the world is on the decline.
President Ma said that the government has three strategies with respect to the global economy. The first is to help Taiwan grow stronger, the second is to integrate the economies on either side of the Taiwan Strait, and the third is to set up a global presence. In other words, he said, the government wants to help people to do business, improve the business climate, and sign a cross-strait economic agreement with mainland China. We want the products we sell to the mainland to enjoy the lowest tariffs and even in some cases face no tariffs. The more products we sell, the stronger our economy will be, he said. Factories will not need to move away, and will hire more people here instead. Strengthening Taiwan, he said, is something that we cannot achieve relying only on ourselves. Rather, Taiwan needs to attract foreign companies to invest here, he said. After the signing of a cross-strait economic agreement, the president said, our economic position in Asia will be different than it is now. Other countries will see how relations have improved between Taiwan and mainland China, and will feel more assured in negotiating free trade agreements with us, he said.
President Ma stressed that signing a cross-strait economic agreement does not betray Taiwan, and to the contrary will help to further stabilize Taiwan and increase its competitiveness. It will also help to maintain the status quo in the Taiwan Strait, he said. As to whether a referendum is required for the signing of a cross-strait economic agreement, the president said that the power to conduct referendums is a right of the people. He said that if opposition parties want to initiate a referendum on the issue, they can pursue this route in accordance with the law and the government will not intervene. However, President Ma pointed out that a free trade agreement or other agreement similar to the cross-strait economic agreement now under discussion is routinely first sent to the parliaments of the parties to the agreement. Parliamentary oversight is extremely important in this respect, he said. The president added that once the cross-strait economic agreement is signed, it will not take effect unless the Legislative Yuan approves it. The president asked everyone to rest assured that everything will be carried out in accordance with established procedures.
【Source: Office of the President】