Friday, June 25, 2010

ECFA to be signed amid optimism, concerns

Taipei, June 25 (CNA) Taiwan and China finalized details of a key trade pact Thursday to cut export tariffs and allow more market access to each other, but Taiwan's opposition is planning a massive rally Saturday to protest the deal.

According to President Ma Ying-jeou, the economic cooperation framework agreement (ECFA) -- expected to be signed in the Chinese city of Chongqing June 29 -- will prevent Taiwan's economy from being marginalized in the process of East Asian economic integration and will help reduce Taiwan's jobless rate.

The Chung-hua Institution for Economic Research has said the ECFA could create more than 260,000 jobs in Taiwan and increase the gross domestic product by around 1.7 percent per year.

However, opposers of the deal, led by the main opposition Democratic Progressive Party (DPP) , fear that the ECFA will make Taiwan, which exports more than 40 percent of its products to China, even more dependent on the other side of the Taiwan Strait and increase the unemployment rate when an influx of Chinese products and services jeopardizes local industries.

The DPP and the Taiwan Solidarity Union, a minor opposition party led by former President Lee Teng-hui which will organize Saturday's rally, will again demand a referendum on whether the deal should go ahead. Similar demands have already been rejected by the government.

The DPP said it was hoping to mobilize 100,000 supporters to take part in the protest.

The ECFA will be reviewed by the Legislative Yuan in an extra session in July. While the ruling Kuomintang (KMT) has said the legislature can only decide whether it will ratify the pact or not, opposition legislators have insisted on an article-by-article review.

Another concern is whether China will stop interfering with Taiwan's effort to seek free trade agreements (FTAs) with other countries, especially its major trading partners such as the United States, the European Union and Japan, once the ECFA is signed.

Zheng Lizhong, vice president of China's Association for Relations Across the Taiwan Straits, did not give a direct answer Thursday when asked about the issue, saying only that "China will properly address the issue to help create an environment in which Taiwan can tackle opportunities and challenges arising from growing cross-strait economic integration." The agreement has been welcomed by various countries, including the United States and the European Union.

Meanwhile, a Presidential Office spokesman said the government realizes that the ECFA does not solve all the country's problems because local businesses will have to upgrade themselves after the pact kicks in to increase their global competitiveness. President Ma Ying-jeou will deliver "in due time" Taiwan's global econom