Siew Xi Meeting Will Help Taiwan Turnaround
China Times Editorial (Taipei, Taiwan, ROC)
November 11, 2014
Executive Summary: Yesterday Beijing and Seoul held a summit meeting. They announced the completion of substantive negotiations on a PRC-ROK FTA agreement, to be signed within days. The PRC-ROK FTA will have a huge impact on Taiwan's economy. Time is not on our side. We must create a new and upgraded framework for cross-strait economic cooperation. We cannot delay, even for a minute. Taipei must immediately take action to catch up. Mainland President Xi Jinping should uphold his "The two sides of the Strait are a single family” concept. He should work with Vincent Siew to promote the new framework.
Full Text Below:
The widely anticipated Siew Xi meeting was held in Beijing on the afternoon of the 9th. Former Vice President Vincent Siew met with Mainland President Xi Jinping on behalf of President Ma Ying-jeou, and set forth “three reaffirmations.” He hoped to upgrade cross-Strait economic relations. Xi Jinping offered his own mantra: "Maintain confidence, increase mutual trust, mutual respect, and positive interaction." Cross-strait relations over the past six years have remained at low ebb. The Siew Xi meeting may be able to reestablish cross-Strait mutual trust, repair damaged cross-strait relations, restart economic restructuring, and reaffirm our desire for a new arrangement. PRC-ROK FTA negotiations have just been concluded. The Siew Xi meeting is expected to create opportunities for Taiwan's economic rejuvenation. For this, it deserves recognition.
Consider cross-strait interaction. Cross-strait relations have recently taken numerous twists and turns. The two sides are now determined to consider the Big Picture. Vincent Siew wants to ensure peaceful development. He wants to reaffirm the "1992 consensus" as the foundation for cross-Strait interaction, formal negotiations, and cross-Strait economic cooperation. Hence, his “three reaffirmations.” These three affirmations show the Ma government’s determination to promote the path of peaceful development it has over the past six years. The "1992 consensus" institutionalized cross-Strait economic and political cooperation. The core of this policy is ECFA. Xi Jinping noted that cross-Strait relations have encountered difficulties and resistance. These were unavoidable. But they merely mean that we need increased exchanges and mutual trust, and respect for each others’ systems. He affirmed the two sides’ adherence to the "1992 consensus," the establishment of a common political foundation for opposing Taiwan independence and enhanced mutual trust, as the key to the cross-strait relations and maintaining the peace.
The Siew and Xi exchange helped untie cross-Strait knots. It reaffirmed and consolidated the "1992 consensus." It left both sides room for different interpretations. It enabled cross-Strait relations to remain unaffected by recent ups and downs. Meanwhile, to overcome cross-Strait economic stagnation, Vincent Siew proposed a new upgraded framework for cross-Strait economic relations. This framework is highly innovative and pragmatic, and offers concrete proposals for the solution of problems. The two sides should explore this proposed framework. They should study it, then implement it.
Current cross-strait economic cooperation is based primarily on the cross-Strait framework formulated by Ma in 2008, when the Ma government took office during the financial crisis. It was built on a foundation of cross-Strait economic complementarity and reciprocity. But in recent years, dramatic changes have taken place in the global economy. Cross-Strait economic relations have undergone structural changes. The original economic cooperation framework is inadequate for the new cross-Strait situation. This can be viewed from several angles. First of all, Mainland economic development has entered a new phase. It has gone from high-speed growth to medium-speed growth. Therefore it must change its economic growth mode. It must turn its attention to domestic demand and the equitable distribution of wealth, and away from reliance on exports. Industrial development must shift away from demand-driven and investment-driven to innovation-driven. This is Xi Jinping's often stressed “new normal." The Mainland economy has entered a "new normal" phase. This has changed the pattern of cross-strait trade. A complementary relationship has rapidly changed to a competitive relationship. As a result the public on Taiwan has become increasingly concerned about a potential Mainland threat to Taiwan's economy.
Secondly, accelerating regional economic integration is rapidly rewriting the global economic map. This includes the US-led "Trans-Pacific Partnership Agreement" (TPP) and the Mainland-led "Regional Comprehensive Economic Partnership Agreement" (RCEP), and FTAAP (FTAAP) promoted at this year's annual meeting of APEC. Taiwan cannot participate in TPP and RCEP negotiations because of political factors. It is in danger of economic marginalization. This has substantially increased the difficulty of ECFA follow-up negotiations.
Cross-Strait economic cooperation tends to favor consortia and large enterprises. Most SMEs, young people, and ordinary citizens receive few benefits. They may even become victims of market openings and distortions in the distribution of benefits. As a result, public support for cross-Strait economic cooperation is far lower than government expectations. Cross-Strait economic and trade relations should bring substantial benefits to people's lives. Only that would qualify as a true cross-strait peace dividend. We must create a new, upgraded framework for cross-strait economic cooperation. We must expand the peace dividend, and correct the imbalance in trade and economic interests. This is a matter of the utmost urgency.
Vincent Siew noted the need direction for a tripartite, upgraded version of cross-Strait economic relations. One. We must establish a new mechanism for joint participation in regional integration. The two sides should support each other in participating in in TPP, RCEP and FTAAP. The new mechanism should inspire public confidence in cross-strait trade liberalization. Two. We must establish a new model for cross-Strait economic cooperation. We must acceleration MTA negotiations. Three. We must establish a people-centered new platform for cross-strait exchanges. We must allow SMEs, young people, and ordinary citizens to fully share the fruits of exchanges and cooperation. These three strike at the core of current cross-Strait economic issues. They reinforce each other. The two sides should form research teams consisting of government officials and scholars. They should develop specific, in depth programs. Then, through existing institutionalized consultation and cooperation mechanisms, they should promote and implement them.
Yesterday Beijing and Seoul held a summit meeting. They announced the completion of substantive negotiations on a PRC-ROK FTA agreement, to be signed within days. The PRC-ROK FTA will have a huge impact on Taiwan's economy. Time is not on our side. We must create a new and upgraded framework for cross-strait economic cooperation. We cannot delay, even for a minute. Taipei must immediately take action to catch up. Mainland President Xi Jinping should uphold his "The two sides of the Strait are a single family” concept. He should work with Vincent Siew to promote the new framework.