TT: What about the proposed economic cooperation framework agreement (ECFA)? You said Taiwan would benefit by signing an ECFA with China. Will you include different voices from the opposition parties?
Ma: I will, and it is because of the opposition parties’ opinions that we made some changes in how we negotiate and how we communicate with the public. We will present a report to the legislature after holding formal negotiations with mainland China, and will also explain the matter to the public, so that people will understand what ECFA is. (but when? Ma keeps saying this but it seems Ma and his government will explain its contents fully AFTER it is signed and a fait accompli for the Legislature to rubber stamp. By that time any public concern or protest will be irrelevant and impotent)
The Ministry of Economic Affairs and the Mainland Affairs Council toured the country last year to explain the ECFA to the public and helped people from all walks of life know what kind of problems they would encounter. For example, the petrochemical industry wants us to sign an ECFA as soon as possible, so that it can enjoy export tariff cuts. (If you look at the boldened part of the paragraph above and then the last sentence that follows it, Ma's statement has no internal logic. He is saying "We travelled to tell people what problems policy A would given them. For example, industry X will benefit".)
As to whether the textile industry should be included in the “early harvest” list, I visited King Fu-lung Corporation in Shetou (社頭), which produces silk socks for the famous Huagui brand. The company’s president said the industry was willing to be on the list. I told him that if we put the industry on the list, they will receive a reduction in export tariffs, but the imports from China will also receive tariff cuts. Textile companies said they should be able to handle the situation.
The Ministry of Economic Affairs also discussed the issue with the towel and bedding industries, and they do not want to be on the early harvest list. We will either exclude them from the list or extend the grace period. The government will communicate with those who will be affected by an ECFA so that people will have a better understanding of what they need to plan for in the future. (Remember that the question asked about different voices from the opposition parties? Ma skips that in the first paragraph by claiming to 'have made some changes in how we negotiate and communicate with the public'. Instead, Ma attempts to paint a picture of corporatism at its finest. Need to win over the entire Textile Industry? Just speak to one company's President and then claim that all textile companies said they can handle the 'situation'.)
TT: You said the towel and bedding companies could be excluded from the early harvest list, but an ECFA is, after all, a mere transitional mechanism, and in the end, the country will still have to open for tariff concessions and more liberal trade. How will the government provide the needed assistance and help with industry transformation?
Ma: There are several ways to do it, including giving short-term assistance or helping businesses to transform themselves and increase their competitiveness. In the process of industrial development, Taiwan went from exporting agricultural and textile products to exporting electronics. Some industries must experience transformation in the process; this is a normal situation in the course of industrial development.
The government will spare no efforts to reduce the damage to local companies. The Ministry of Economic Affairs is planning on appropriating a NT$95 billion [US$2.9 billion] budget over 10 years to help local businesses. Why do we spend so much money and why don’t we just stay where we are? Because we will fall behind if we maintain the status quo. (This is 'Change We Can't Believe In' redux KMT style. You have to credit Ma for staying on message: No ECFA = fear, doom, the end, economic catastrophe, stuck in the past etc. He's been saying this since the idea of the agreement first leaked out. The problem with Ma's ECFA or Bust! theology is that it is one that puts nearly all Taiwan's eggs in the Chinese basket without even considering other ways to reinvigorate the economy. Here's just one ... How about moving away from export dependence and motivating companies and individuals to join a green industry revolution: one that would aim to cut carbon emissions by 90%, clean up the air, soil and water and create a sustainable tourism industry that, along with services, seals the gaps in income and employment generated by dumping old dirty industries. But then, inaugurating another science park that will almost certainly pollute land and water as well as threaten a species of dolphin's habitat is more like the way the KMT regards 'building for a sustainable future'.)
TT: Mr. President, you just mentioned that signing an ECFA is just the beginning. Can you tell us exactly where it will eventually lead Taiwan? Is it an interim agreement to a free-trade area? If so, then in accordance with the WTO, an open market for free trade and labor needs be set up within a 10-year time period. Wouldn’t that then contradict your promises to ban the import of more agricultural products and workers from China and more toward some kind of "one China market?"
Ma: First, we have to ask ourselves this question: Can we afford not to sign an ECFA? (YES!) Ten years ago, there were only three FTAs [free-trade agreements] in Asia, but the number jumped to 58 last year. The only two countries in Asia that do not have FTAs [with other Asian nations] are Taiwan and North Korea.
Taiwan has signed FTAs with five of its diplomatic allies in Central America. Although they have increased bilateral trade, the amount of the increase has been small.
So when we sign FTAs, we can do it with our major trading partners, such as mainland China, Japan, the US, ASEAN countries, the European Union, South Korea and Singapore.
However, we have encountered various obstacles over the past years. We launched FTA negotiations with Singapore about 10 years ago, but many factors made the attempt unsuccessful.
TT: What factors? Would you say China was the main factor?
Ma: That’s correct. And because of this, we want to talk with mainland China first. (Excuse me? China blocked Taiwan's FTA talks with Singapore but now we go to China with cap and bowl in hand asking them to give us a break. Ma is attempting to inveigle the Taiwanese public into believing that the Chinese have changed their position. China helps Ma by staying relatively quiet but they have nonetheless maintained that they do not wish Taiwan to sign FTAs with other countries. Ma keeps suggesting that once ECFA is signed China will 'allow' Taiwan to sign FTA's. Mainland Affairs Council Chair Lai Shin-yuan insisted that Taiwan will make its own FTA policy independent of China but Ma is arguing that it is through China, and with their blessing, that we will get the golden carrot of a FTA with a third country. I have no faith that China will agree to Taiwan signing FTAs before or after ECFA. But there's more ...)
TT: China has never promised that we could sign FTAs with other countries after we ink the ECFA with it.
Ma: Their position in the past (it is their position now too!) was against it and we know it. But we cannot stop developing our relationships with other countries simply because the Chinese Communists are against it. (no but the Chinese Government can stop you!)
We want to participate in UN activities, and we still have to make an effort despite the Chinese Communists’ opposition. Our efforts have paid off. We managed to participate in the World Health Assembly [WHA] and join the Government Procurement Agreement [GPA]. Where there is a will, there is a way. (The way here being subsuming your sovereignty by having your delegation be listed as Taiwan, China)
Mainland China has signed more than 10 FTAs. Once we ink an ECFA with the mainland, ASEAN countries will not reject the idea of talking with us. (Another unverifiable and quite undeliverable promise. 633 anyone?)
TT: The thing is, none of these countries has made such a promise. Don’t you think you are being overly optimistic?
Ma: That’s true, but Taiwan cannot simply depend on somebody else’s promise to survive in this world. (Ma should take a leaf out of his own book. I think the Taiwanese know better than anyone by now that they cannot simply depend upon Ma's promises to survive in this world. At least not if they want to exercise any continued autonomy and democracy.)
TT: Judging by your words, you seem to suggest that we would be limited to signing FTAs only with those countries that have signed FTAs with China.
Ma: I heard that’s mainland China’s view. (See Mike Turton's post: Ma was the one who said that so it is his view not China's: Asked whether Taiwan will sign FTAs with other countries after signing an ECFA with the mainland, President Ma answered, “It most certainly will.” “As long as other nations have already signed FTAs with the mainland, Beijing will have no objections if these countries wish to discuss similar deals with Taiwan,” the president said.) But when we negotiated an FTA with the US, China did not have an FTA with the US. The Chinese Communists and Singapore did not have an FTA when we began negotiations with Singapore. (Neither attempt to sign FTAs with the US or Singapore were successful in large part owing to Chinese pressure, regardless of whether it had an FTA with the relevant country)
So it shows that mainland China’s policy does not affect us. (Cough, splutter...! Didn't Ma just a few minutes previously say that China was the factor that blocked Taiwan from signing an FTA with Singapore? Oh, yes, that was OLD China. NEW China's policy is designed not to hinder Taiwan. Except that NEW China's bottom line hasn't changed, only its policy of how it will defend it). Our foreign policy and international relationships are independent. (Of reason and wisdom)
If we sign an ECFA with mainland China, the pressure and obstruction to our effort to sign FTAs with other countries will be reduced. (Another promise I suspect Ma will fail spectacularly to come through on. Note also Ma fails to name a cause for 'pressure and obstruction'. In his mind its not conducive to relations with China to blame them for the things they most patently do. Instead, its much better to go to negotiations with one eye blind and one hand tied behind your back so as to give the much bigger negotiator a more even playing field.)
The reason why we want to sign an ECFA is not other countries. If we don’t sign one, other countries will enjoy zero tariffs (A 'beautiful mind' forming a beautiful contradiction!) when they export products to China, while our products will lose their competitiveness because of higher tariffs.
TT: So that brings us back to our original question. Exactly where will the ECFA lead Taiwan, if it’s just the beginning?
Ma: First, it will help us catch up with the pace of economic integration in the region. There are 58 FTAs in Asia, but Taiwan has none. (Why can Joey play with the FTA and I can't? wah!) We have FTAs with our diplomatic allies in Central America, but we must remove the obstacles and sign more with other countries. The solution is to sign an ECFA with Beijing. (Here Ma makes his promise explicit. Sign an ECFA with China and that will remove the obstacles to Taiwan signing FTAs with other countries - there is as yet not one shred of earthly evidence that can be cited to back up Ma's supposition.)
Cross-strait trade in 2008 exceeded US$130 billion, but there was no mechanism in place to institutionalize the trade. If there is such a mechanism, it will not only reduce obstructions to our effort to sign FTAs with other countries (and again! Talk about tell a lie often enough ...), but also increase the ratio of our products in the Chinese market. (And what about the ratio of our products in other countries?)
An ECFA is conducive to Taiwan, but some local businesses will pay a price at the same time. We have conducted studies on the issue and held countless meetings to integrate opinions. (The KMT held countless meetings to sway and co-opt opinion. 'Integrating opinion' is the new bland phrase of the moment that sounds like building consensus without having the need to actually to it through sound and reasoned argument backed up by fact. No, Ma and the KMT will continue to 'integrate opinion' until opinion is no longer necessary to integrate, namely about 1 second after the wet ink of Taiwan's signature has splashed itself on the ECFA agreement.)
But it seems all of your questions presume that signing an ECFA will be negative to Taiwan. Do you think it’s better not to sign it? (And on to the offensive ... Much better option than actually trying to answer a question you don't know the answer to)
We wanted to negotiate an FTA with the US, but they have their own problems. Japan and South Korea did not dare to talk with us because they are afraid of the mainland. (Can you tell us why you think Japan and South Korea fear China Mr Ma? If they perceive a threat from China without Chinese missiles facing them, do you think it is wise for Taiwan to act like China doesn't threaten it?) So we begin with the mainland, hoping to negotiate a mechanism to institutionalize bilateral trade. Once we sign an ECFA with the mainland, we will have more opportunities. (OMM ... now chant with me until you believe it ... 'AFTER ECFA, FTAs HERE WE COME')
TT: Have any of these countries made any promises?
Ma: None of those countries have diplomatic ties with us. It’s very hard for them to make any promise. (In other words ... NO. Ma falls on the sharp edge of the lack of logic underpinning his 'ECFA will lead to other FTAs' argument. Here he is stripped bare and has to concede that not one statement from any country could be used to indicate that Taiwan could sign more FTAs with third countries after it sings ECFA. Surely, that lays to rest that particular misnomer and we can all go home now knowing that ECFA will not lead to FTAs with other countries?)
TT: You earlier said our questions seemed to presume that signing an ECFA would be negative to Taiwan. But it seems to many that your presumptions about an ECFA appear overly optimistic. Don’t you think you may be indulging in wishful thinking? (Have at you Sir! How do you like THEM apples?)
Ma: No. Since I took office [May 2008], cross-strait relations have improved. I said in my inaugural speech that if Taiwan continues to be isolated internally, cross-strait relations would be hard to develop. (I'm not sure what that means at all. Isolated internally?)
In the past, the Chinese Communist Party spared no effort to entice our diplomatic allies, but over the past 20 months our diplomatic relations have remained quite stable. (Let's see what happens in Haiti when the dust settles)
So when the cross-strait ties are stable, our international space also increases. (This is a specious and disingenuous claim. We participated in the WHA as Taiwan, China against the wishes of the Taiwanese people and against the dignity of their self evident sovereignty and we sent pro-unification Lien Chan to APEC in order to make friendly with President Hu) We finally participated in the WHA after 12 years of trying. The GPA took four years and there have also been concrete achievements in our participation in APEC.
These are not outstanding, but at least we have made some breakthroughs, thanks to the improvement of cross-strait relations. The policy has received recognition from the international community. (Who are mostly blind to the reality of Taiwanese opinion on the ground and are engaged in a love you-hate you complex as they eye the Chinese market and imagine that the Chinese Government is going to let them develop market dominance)
Of course, some people who are doubtful may say you are too naive or it’s too risky. But what other strategy can we use? (One that is not designed to end in annexation to China perhaps?) We already know what will happen if we adopt a belligerent approach on the diplomatic front. We secured three new diplomatic allies, but lost nine. (So Taiwan defends its own interests and it is 'belligerent' but when China complains about everything and anything to pressure countries to ignore Taiwan and threatens Taiwan with missiles then it is on a path of 'peaceful rise'?)
TT: Some people have proposed that when we negotiate an ECFA with Beijing, we ask it to stop obstructing us from signing FTAs with other countries, or demand the ECFA take effect in tandem with FTAs signed with the US or Japan.
Ma: I will convey your opinion to the Mainland Affairs Council and the Ministry of Economic Affairs. (or in other words ... 'whatever, its not going to happen - we don't negotiate like that. We don't have a bottom line. its the new 'position of strength and dignity')
TT: That’s not our opinion, but reflects the doubts some others have on the planned pact.
Ma: I know. That’s why I said I would let the government agencies deliberate on the proposal.
There may be remedies for diplomatic isolation, but economic seclusion will hurt our muscles and bones. So we must find a way out. That is why most businesses support signing an ECFA (do they? on what evidence is Ma making this claim and what types of businesses?), especially foreign investors in Taiwan. You are an English-language newspaper, so you must have read the White Papers released by the American Chamber of Commerce and European Chamber of Commerce. Before 2000, every year they urged the administration to open direct transportation links and liberalize cross-strait trade. (And the DPP tried and did a lot in unofficial negotiations but China prevented any development that could have been claimed by the DPP to be substantive) We didn’t make them write those White Papers, you know.
TT: These groups obviously had their own interests in mind when they penned their White Papers. During the Democratic Progressive Party [DPP] administration, they said direct transportation links would help Taiwan secure a FTA with the US. The two sides now have broader direct transportation links since you took office, but there are still no FTAs.
Ma: That’s because we just resumed the talks. It will take some time. (Ma here is appropriating the progress made under the DPP as that made by him alone. The truth is that the DPP did most of the work securing direct transport links and they had begun before Ma go into power. Only the frequency and official status of the links changed after Ma got into power)
As for the ECFA, the two sides completed their individual studies last year and a joint study was just made public (on Wednesday). The conclusion is that the ECFA will benefit both sides. (Surprise surprise!) It will boost Taiwan’s GDP by 1.6 percent to 1.7 percent and increase employment by some 200,000 people (ooohh ... I feel Ma may have just had another '633' moment here.) The negotiations will take time.
It took Singapore and the US three years to negotiate an FTA and about 10 years for ASEAN countries and mainland China.
TT: Given that, why the rush to launch official negotiations on an ECFA with China this month and to sign the pact in May? (good question)
Ma: Because we are already falling behind. If we don’t catch up now, we won’t be able to catch up in the future because we are already 10 years late. (It's now or never folks. You'll just have to believe me on that one and I should know, not being all that well versed in economics. If we don't sign ECFA it will mean THE END. There will be no future without it.)
TT: In numerous speeches you’ve often spoken of “listening to the people’s voice and letting the people be the boss.” Given that, will you reconsider holding a referendum to approve the signing of an ECFA, since a referendum is a way to directly reflect public opinion, as opposed to through the legislature, which is indirect democracy, especially in the wake of the ruckus over the amendment to the Local Government Act. That uproar suggested that KMT lawmakers were merely supporting the party’s decision instead of conveying the opinions of the voters in their districts.
Ma: We have enacted a lot of laws and pushed for the signing of agreements with other countries by winning the approval of the Legislative Yuan. (Examples please)
Referendums are a good approach and are a form of direct democracy, but they cost too much. And there are limitations. Not all government policy can be formed this way. As long as we can have good communications with the pubic and have sufficient discussion with legislators, I think this is normal and a way to follow most other democratic countries, which receive the approval of their congresses to ink pacts. (Note that Ma has changed from arguing against referendums on economic agreements that don't affect sovereignty to saying that communication with the public and legislators is sufficient)
Costa Rica is an exception because its congress has collapsed. Joining the European Common Market, or adopting the euro are different things and will have a bigger influence on people’s lives so they [European nations] held referendums to make the decision. (So ECFA will not have a big influence on people's lives?)
To solicit support from the public (or to claim that the support exists sure because we asked lots of people), we are sending government officials around the nation, including remote areas (Saturation of the ECFA or Bust! message is the key), to promote the ECFA. We are making an extra effort to explain clearly to those people who may suffer from the trade agreement about the possible impact. I think what we are doing should meet the requirements of a democratic country.
Most countries around the world are adopting the same approach when it comes to signing similar agreements. (Again, examples please ...)
TT: If an ECFA is signed, will both sides sign it under their status as WTO members? Will Taiwan register the signing of the ECFA with the WTO?
Ma: Yes. (This at least seems welcome. Let's see if it actually pans out that way. Before I get too enthusiastic perhaps I should remember that Taiwan is listed as a 'customs union' under the WTO and not a 'State') Only under the WTO framework can we offer tariff reductions just to mainland China. Usually such tariff cuts would have to apply to other countries as well. The signing of an ECFA will certainly meet the essence of the WTO.
TT: Does Taiwan have any countermeasures against the possible cancellation of the proposed ECFA by China, which could use it as a tactic to obstruct Taiwan’s efforts to enter into free-trade agreements with other countries?
Ma: This is merely an assumption. (But also by a factor of ten it is also a more credible and likely assumption than Beijing 'allowing' Taiwan to sign FTAs without countries after it signs an ECFA with China) This also leads back to my previous assertion that we should develop Taiwan’s foreign affairs and its relations with mainland China at the same time (or does he mean in co-ordination with each other e.g Check with China before MOFA makes a decision?). We hope to make it a positive cause-and-effect. If Taiwan is isolated on the international stage, it will be difficult to achieve further progress in cross-strait ties. (This is hilarious. Beijing is isolating Taiwan on the international stage and it also happens to be the one manipulating the other half of cross-strait ties. Cross-strait ties will surely improve once Ma moves Taiwan into Beijings sphere of influence and, ultimately, rule.) Taiwanese will feel they are losing their dignity since they cannot have a say in national affairs (Which nation's national affairs Mr Ma?). This will harm cross-strait relations. (And the prize for Most Insensible and Twisted Logical Construction goes to ...)
In the future, we will seek free-trade agreements by selecting countries that are easier to approach, as it will then be easier to make progress. We have been trying for many years. Taiwan has a small handful of trading partners. We will put them on our priority list because it will be less meaningful than signing free-trade agreements with other [non-allied] nations. But, we do not have to sign such agreement with all of them. We will be selective. We do not have to ink a trade pact with countries where it could have negative impact on some Taiwanese sectors, such as agriculture. (All of this is suppositional, based on the misconception that Beijing will 'allow' Taiwan to sign trade agreements with other countries in the first place - like talking about how you will spend the lottery win when you're not even going to buy a ticket.)
If we can take our first step now, however, it will help a lot. People may ask me: What is the haste? We have lagged behind our Asian peers for 10 years and we have to catch up, or our situation will worsen. (Ma again threatens a doom-ladened scenario by drawing on Taiwanese tendency to compare themselves to others and desire to 'be as good as the others' quite out of proportion to what is actually NECESSARY for the economy or environment.) Others might say that ‘ASEAN-plus-one’ will not pose a threat to Taiwan anytime soon. But, we have to be well prepared for their expansion to ASEAN-plus-two, or ASEAN-plus-three. As a political leader, I have to look at what Taiwan will face in next 10 or 20 years. (Annexation?)
Signing an ECFA will also help Taiwan hit three major goals — being the world’s innovation center, the economic and trade hub of Asia and the headquarters of Taiwanese businesses. (Governments in Taiwan have talked about making Taiwan a trade hub for Asia for the last 16 years and it is indicative of the effect of opening up that begun under President Lee that one of the major goals is to encourage 'Taiwanese' businesses to make Taiwan their HQ - not a question for most companies in most countries who don't have the luxury of moving HQ to a an offshore tax haven island country.) The trade pact with mainland China will strengthen Taiwan’s role in becoming the economic and trade hub in Asia as more countries will be interested in investing in Taiwan in light of its closer trade ties with the world’s No. 2 economy, mainland China [sic]. (And finally, another suppositional claim to end with and one to hold up to Ma when his best laid plans come crashing around his ears.)
This post is already ridiculously long so I'll stop there.
LINKS:
- LA Dodgers coming to Taiwan in March
- The capitulation begins on Tuesday .. ECFA negotiations start in Beijing.
- Google quietly backs down and life goes on (don't tell me .. Google can do more to help people in China by staying there?)
- Taiwan groups protest Chinese culture that kills the environment for the sake of prestige, hubris and tradition
