Tuesday, June 17, 2014

Policy for pilot zones faulty: Tsai

By Chris Wang  /  Staff reporter

President Ma Ying-jeou’s (馬英九) free economic pilot zones policy is based on faulty logic, which assumes more market opening would lead to economic prosperity, without recognizing the importance of upgrading Taiwan’s industrial structure, Democratic Progressive Party (DPP) Chairperson Tsai Ing-wen (蔡英文) said yesterday.

Engaged in a debate in the past two weeks with the Ma administration over the impact of the planned pilot zone project, which looks to serve as a model for business convenience and liberalization, Tsai wrote an open letter, published by the Chinese-language Apple Daily yesterday.

It was the second time that Tsai stressed that a mature and open economy like Taiwan should not bank on the establishment of special economic zones to drive economic development following her concluding remarks at a DPP meeting in Greater Taichung on June 10.

“While the pilot zones project highlights free economics, it would in fact destroy the spirit of free trade and fair trade, because Taiwan, is already a model trading partner in the world in its market opening in goods and service,” Tsai said.

The Ma administration has said that the policy would benefit Taiwan’s accession to the proposed Trans-Pacific Partnership and the Regional Comprehensive Economic Partnership and has described Tsai and the DPP’s policy as isolationism.

Ma’s policy design encourages the establishment of as many pilot zones as possible, which could come in the form of free trade ports, agricultural technology parks, processing zones and technology industrial parks, and pledges tax incentives and relaxed restrictions on Chinese investment and personnel flow, Tsai wrote.

The unilateral opening of market access could eventually jeopardizing Taiwan’s bargaining chip on the negotiation table and become a hotbed for corruption due to the lack of administrative management, she said.

More importantly, it could have a damaging impact on Taiwan’s robust service sector and fragile agricultural industry, Tsai said.

The government’s No. 1 priority should be promoting and helping upgrade local industries and even if the pilot zones are necessary, the government should be very careful with its selection, the chairperson said.