A joint statement by Taiwan and Singapore Thursday that they have agreed to explore the feasibility of an economic cooperation agreement represents a breakthrough for Taiwan following its recent historic trade pact with China.
The Taiwan government has said that the economic cooperation framework agreement (ECFA) with China will prevent Taiwan from being marginalized in the Asia Pacific region, where economic integration is taking place rapidly.
The ECFA will also help to reduce cross-Taiwan Strait tensions and thus increase Taiwan's chances of securing trade deals with its major trading partners, as China will stop blocking the efforts in that direction, the government has said.
Taiwan is hoping that the Singapore initiative will be the first in a series of trade liberalization negotiations with other countries.
The level of success of Taiwan's efforts to forge other trade pacts will be seen as a barometer of whether the ECFA is living up to expectations.
The following are the positions of Taiwan's major trading partners on potential bilateral trade deals:
-- The United States
The U.S. has said that a full-fledged FTA with Taiwan is not on the cards at this time because it does not think Taiwan is fully prepared to open its market. However, it supports Taiwan's right as a World Trade Organization (WTO) member to sign FTAs with other members, the U.S. said.
"The United States has no plans to begin talks with Taiwan about an FTA at this time," said David Shear, a deputy assistant secretary of state, at the Carnegie Endowment for International Peace.
Raymond Burghardt, chairman of the American Institute in Taiwan, made a similar statement at a round table meeting with the Taiwan press June 4.
The U.S. intends to improve bilateral trade ties with Taiwan under the framework of an existing Trade and Investment Framework Agreement (TIFA) and there is not much enthusiasm in Washington for another FTA, he said.
Both sides will try to use a "block-building" format that will rely on a series of specific deals under the TIFA framework, such as a bilateral investment agreement and an agreement on avoidance of double taxation, to enhance cooperation, he said.
Taiwan and the U.S. have not held TIFA talks since 2007.
-- The European Union
The EU and Taiwan have been talking about the adoption of trade enhancement measures (TEMs) rather than an FTA.
Mauro Petriccione, director of the European Commission's Directorate General of Trade, said June 3 in Taipei that the EU member states will not give the commission permission to negotiate trade deals with Taiwan " unless they have some reasonable assurance that this will not damage our economic interests in China."
Petriccione also said China remained the key to whether the EU and Taiwan would be able to sign TEMs. He added that the possibility of an FTA between Taiwan and the EU at the moment is "very unclear."
Taiwan's top envoy to the European Union and Belgium Y.L. Lin said Aug. 2 in Brussels that the Taiwan government "has a high degree of willingness" to sign an FTA with the EU but should first seek to remove trade barriers.
The EU is Taiwan's fourth largest trading partner. In 2009, aggregate investment in Taiwan by EU member states exceeded US$27.4 billion, making the EU Taiwan's largest source of investment from abroad.
-- Japan
Japan, Taiwan's second largest trading partner, has been carefully evaluating the impact of the ECFA and considering its strategy beyond that.
Japan has said it would welcome closer economic relations with Taiwan.
Japanese officials have been quoted in the media as saying that it might be necessary to promote an FTA among Japan, China and South Korea.
Taiwan will liberalize its trade relations with Japan through a "block-building" approach, starting with investment protection and intellectual property rights protection, Nien Shinn-shyh, deputy secretary-general of the Ministry of Foreign Affairs' Association of East Asian Relations, told reporters July 7.
A spokesman for Japan's representative office in Taiwan, the Interchange Association, confirmed Thursday that both sides had held discussions in Tokyo on economic matters, including investment. However, no decision has been made on bilateral cooperation, the office said.
None of Japan's existing trade agreements with other countries are called free trade agreements, but rather Closer Economic Partnerships.
-- The Philippines
The position of Taiwan's closest neighbor to the south is not yet clear, as the new Philippines government has only been in office since June.
"Taiwan's proposal for an FTA with the Philippines will most likely be presented at the next meeting of the Joint Economic Conference scheduled for around the end of the year, " Antonio Basilio, managing director of the Manila Economic and Cultural Office (MECO) in Taipei, said Thursday.
He said the existing Subic-Clark EPZ/Taiwan EPZ Economic Corridor Agreement could serve as a precursor to an FTA.
The economic corridor is a project aimed at linking the economic zones of the two countries to make the Philippines "Taiwan's entry point to the ASEAN market." It seeks to take advantage of the fact that products processed in the Philippines are regarded as ASEAN products and are thus allowed duty free entry to other ASEAN member countries.
Ramon Vicente T. Kabigting, the Philippines assistant secretary of Trade and Industry, was quoted as saying Friday that while the Philippines' will stick with the one-China policy, it will not rule out the possibility of an FTA with Taiwan.
-- Thailand
Thailand, Taiwan's 12th-largest export market, is reportedly one of Taiwan's priorities in its FTA efforts.
Porpot Chagyawa, the head of the Economic Affairs Section of the Thailand Trade and Economic Office in Taipei, said Aug. 2 that an FTA with Taiwan or any other country is a matter that requires careful assessment, as its effects could be significant.
However, existing mechanisms have provided a substantial foundation for the expansion of trade and investment between Thailand and Taiwan over the years, he said.
-- Malaysia
Malaysia, one of Taiwan's top investment destinations in Southeast Asia, reopened ministerial-level meetings with Taiwan on trade and economics on March 31 after a six-year hiatus.
According to a comment in the media by a Taiwanese official, Malaysia has said that the cross-strait ECFA "will facilitate the signing of an FTA between Taiwan and Malaysia."
-- Vietnam
Taiwan is Vietnam's fifth largest trading partner. There has been no indication of Vietnam's intention with regard to an FTA between the two countries.
However, Huang Chih-peng, director-general of Taiwan's Bureau of Foreign Trade and one of the main negotiators in Taiwan's ECFA talks with China, has been designated as Taiwan's representative to Vietnam. By Chris Wang CNA Staff Reporter enditem /pc