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Mainland Affairs Council

President Ma's Remarks

President Ma attends event in central Taiwan to speak on benefits of Cross-Strait Trade in Services Agreement

On the evening of July 27, President Ma Ying-jeou visited Jenn Lann Temple in Dajia District, Taichung City to address a crowd assembled in the square in front of the temple on the benefits of the Cross-Strait Trade in Services Agreement. In addition to dispelling false claims about the agreement, the president also explained how it will benefit Taiwan.

In remarks, President Ma explained that Taiwan relies on exports for 70% of its economic growth, so the government has always sought to minimize barriers to exports while maximizing facilitative measures. He stated that Taiwan's main competitors in Asia, including Korea, Japan, and Singapore, have all signed more free trade agreements than Taiwan has. In addition, the agreements signed by these nations account for 35%, 18.7%, and 64% of their overall trade, respectively, and these figures could rise to 82%, 72.2%, and 88%. The president then compared these figures with those on Taiwan's free trade agreements, which presently cover 4.18% of Taiwan's total trade volume, with the possibility that this percentage could rise to 36.9%. Taiwan thus lags far behind the three nations mentioned above, he stated.

President Ma mentioned that in an effort to avoid being at a competitive disadvantage, three years ago Taiwan signed the Cross-Straits Economic Cooperation Framework Agreement (ECFA) with mainland China. The Cross-Strait Trade in Services Agreement is part of the broader ECFA agreement, he said, and hopefully by the end of this year the two sides will also sign the Cross-Strait Trade in Goods Agreement, as this would encourage other nations to sign economic cooperation agreements with Taiwan and effectively reduce tariffs on Taiwan's exports. For instance, the president stated, Taiwan and New Zealand in May of last year began negotiations on the Agreement between New Zealand and the Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu on Economic Cooperation (ANZTEC). This pact was signed on July 10 of this year, he pointed out, noting that the negotiation process went very quickly.

President Ma also acknowledged that the signing of the Cross-Strait Trade in Services Agreement has sparked considerable debate. He said that the government's efforts to publicize the content of the agreement have been insufficient, while inaccurate information has been repeatedly aired by the media. For instance, the president commented, some have said the agreement opens Taiwan's doors to some four million to five million laborers from mainland China in the service sector, but this is absolutely not true. In fact, he said, the government has allowed mainland Chinese enterprises to invest in Taiwan for over three years and 398 firms have been set up here so far. In this period, however, only 216 mainland Chinese managers and professionals have come to Taiwan, while these investments have created 6,771 job opportunities here. Moreover, the ROC government each year carefully checks the Taiwan entry permits of mainlanders working here, and does not issue them alien permanent resident certificates, so fears about a big wave of "investment immigrants" from the mainland are unfounded, he commented. In addition, the president stated, Taiwan liberalized laundry services in 1991, but only two foreign laundry companies do business here. This compares with 6,000 local laundry shops, which is the accurate number and not only 3,000 as some have claimed, he said.

President Ma stated that service-sector companies from Taiwan have done quite well in the mainland. For instance, the coffee shop 85°C, Wang Steak restaurants, RT-Mart, Les Enphants children's clothing stores, and Formosa Optical do business throughout mainland China. In addition, in the wake of the signing of the ECFA, mainland China each year screens roughly 10 films from Taiwan, while no limit is placed on the number of Taiwanese films screened in mainland China, he said. Mainland Chinese films screened in Taiwan over the past two years have generated box office receipts of roughly NT$67 million, while the box office receipts of Taiwanese films screened in the mainland have reached NT$3 billion, which shows that Taiwanese films are very competitive. The president also pointed out that the Cross-Strait Trade in Services Agreement will allow the 800 films produced in mainland China each year to have post-production work done on them in Taiwan, which is a potential boon for firms here.

President Ma stressed that an important constant throughout Taiwan's history is that "engagement brings prosperity, while isolation brings atrophy." Taiwan has no choice but to open its doors, otherwise the size of its market will become smaller and smaller. The president stated that the signing of the Cross-Strait Trade in Services Agreement will bring significantly more benefits to Taiwan than harm. Furthermore, the president commented, the Ministry of Economic Affairs three years ago budgeted NT$95 billion over a period of 10 years to assist industries that are impacted by the agreement.

After completing his initial remarks, the president hosted a prize quiz on the Cross-Strait Trade in Services Agreement. Members of the audience participated enthusiastically in the quiz, which helped them better understand the content of the pact.

【Source: Office of the President】