TIFA: First Test for New Cabinet

TIFA: First Test for New Cabinet
United Daily News editorial (Taipei, Taiwan, ROC)
A Translation
February 6, 2013

Summary: The government's new fiscal policy cabinet is gradually taking shape. Everyone is looking forward to cooperation between the old and new cabinet members. They hope the cabinet can make a fresh start. Two major issues need to be addressed immediately. One. Talks are about to resume for the Taiwan-US Trade and Investment Framework Agreement (TIFA). Two. Cross-strait trade agreement negotiations are about to become a touchstone for the new cabinet. A cross-strait agreement is nearing completion. TIFA is about to begin. These are real tests for the new cabinet.

Full text below:

The government's new fiscal policy cabinet is gradually taking shape. Everyone is looking forward to cooperation between the old and new cabinet members. They hope the cabinet can make a fresh start. Two major issues need to be addressed immediately. One. Talks are about to resume for the Taiwan-US Trade and Investment Framework Agreement (TIFA). Two. Cross-strait trade agreement negotiations are about to become a touchstone for the new cabinet. A cross-strait agreement is nearing completion. TIFA is about to begin. These are real tests for the new cabinet.

TIFA is a platform for Taipei and Washington to deal with bilateral economic and trade issues. Taipei and Washington may have other channels of communication for individual issues. But TIFA is the only high level, formal, consultative mechanism between Taipei and Washington that encompasses all ministries. It is a means by which we can join the Trans-Pacific Partnership Agreement (TPP). Therefore we must succeed. Failure is not an option.

TIFA is still a long way from becoming a free trade agreement (FTA). But it can serve as a starting point for a Taipei-Washington FTA and TPP. TIFA has two main functions. One. It enables negotiations over individual issues such as insurance agreements, inspection standards, and e-commerce cooperation. It strengthens bilateral economic and trade relations. It lays a cornerstone for a future FTA. Two. It gradually eliminates economic and trade barriers between Taipei and Washington. It helps us gains future TPP membership.

But the relationship between Taipei and Washington is asymmetrical. For us the goal of TIFA is a Taipei-Washington FTA. But for the U.S. a Taipei-Washington FTA is not its preferred solution. Therefore Washington focuses more on the elimination of trade barriers. Put simply, Washington gauges our determination to liberalize by how vigorously we eliminate trade barriers. This also determines whether TIFA can become the mechanism for normal dialogue.

Consider the nature of Taipei-Washington trade barriers. Some people look forward to further liberalization by both sides, based on commitments to the World Trade Organization (WTO). Others seek the fulfillment of WTO obligations. To the former, Taipei must voluntarily engage in self-examination and implement reform. Otherwise, the failure to do so will become an obstacle to a future Taipei-Washington FTA or TPP. To the latter, Taipei must fulfill its obligations. Therefore Washington considers its demands entirely righteous. Failure to fulfill these obligations will be the main source of pressure. These matters issues cannot be delayed until negotiations over an FTA or TPP. They must be to resolved in advance. Only then will we be in a sound negotiating position. Only then can we hope to gain future TPP membership.

The trade barrier Washington is most concerned about is for clenbuterol or ractopamine treated U.S. pork. This is the most controversial issue. It is likely to be the most difficult issue during renewed TIFA talks. Under WTO rules, the maximum amount of ractopamine residues allowed in meat products should be based on international standards. If the importing country has different eating habits, or wishes to set more stringent standards, it must cite scientific evidence.

The U.S. beef imports controversy early last year was actually an advance skirmish in the battle over US pork imports. In the U.S. beef imports case, the government eventually cited scientific arguments and the residue limits specified by the United Nations Codex Alimentarius Commission (Codex). It established open standards. But the Codex international standards also apply to pork, chicken, duck, and other poultry products. Therefore past claims that ractopamine is safe also apply to pork. Never mind that we have already accepted international standards for beef. If we want pork treated differently we must summon up even more scientific evidence.

Domestic beef production accounts for only 7% of domestic beef consumption. The market is also segmented. Domestic beef is mostly isothermal. Therefore opening up the market to U.S. beef is unlikely to impact the domestic beef industry. Even then, it generated enormous controversy. Pork is the public's most important meat product. Domestic pork production meets 94% of all domestic pork demand. US pork, especially organ meats and pigs feet, are priced much lower than domestic pork. The impact from increased US pork imports would vastly exceed the impact from US beef imports. A backlash is predictable. Moreover the government has already committed to treating beef and pork differently. It cannot take back what it said. This makes a solution even more difficult.

Three responses are needed. One. TIFA is a "framework agreement." We hope ractopamine is not on the early harvest list. First build the framework. Then deal with this issue later. That would be best for both sides. Two. Our eating habits differ from people in the West. Ractopamine treated U.S. beef has been allowed in. But restaurants all over display "We serve only Australian or New Zealand beef" signs. This can be cited during negotiations with Washington. Three. US pork can in fact be imported. It is merely that they must not contain ractopamine. Therefore there is still room for negotiation. Washington need not make a fuss over this issue.

But most importantly, we must improve the quality of domestic pork and of its marketing. A Taipei-Washington FTA or TPP means a more open environment. We may enjoy a temporary buffer period. But eventually US pork will have to be allowed in. Therefore we must strengthen our competitiveness. That is the only way for long-term development of the pork industry. Ultimately we will have to solve the problem with a "We use only domestic pork" approach.

TIFA是新內閣的第一個考驗
【聯合報╱社論】
2013.02.06

政府新經濟團隊陸續到位，各界也期盼能在老幹新枝搭配下，能開創出新的局面。不過眼前立即要解決的，有兩件大事，一是即將復談的台美貿易暨投資架構協定（ＴＩＦＡ），一是兩岸服務貿易協議協商，這將成為新內閣的第一個試金石。其中兩岸協議即將完成，但ＴＩＦＡ卻才要開始，是真正的考驗所在。

ＴＩＦＡ是台美處理、解決雙邊經貿議題的平台，目前台美之間雖還有其他個別議題的溝通管道，但是ＴＩＦＡ將是台美之間唯一的高層級、跨部會的正式協商機制，同時也是我國爭取美國支持加入「跨太平洋夥伴協定」（ＴＰＰ）的重要途徑，因此有只許成功，不許失敗的壓力。

ＴＩＦＡ的層次距離自由貿易協定（ＦＴＡ）雖還很遠，但其之所以能作為台美ＦＴＡ及ＴＰＰ的起點，主要有兩個功能：首先，在於藉此啟動如投保協定、檢驗標準調和及電子商務合作等個別議題談判，強化雙方經貿關係，堆砌未來ＦＴＡ的基石；其次，在於逐步解決當前台美雙方關切的經貿障礙，以取得加入ＴＰＰ的入場券。

然而，台美的情勢卻不對等。對於我國而言，ＴＩＦＡ的目標在於推動台美ＦＴＡ。但對於美方而言，台美ＦＴＡ並非優先選項，因此將更注重貿易障礙的消除。所以簡單的說，我國消除障礙的程度及力道，正是美方評估、檢驗我國自由化決心的考題，更是ＴＩＦＡ能否回復成為常態性對話機制的關鍵。

按照台美貿易障礙的性質，有些是期待雙方能在世貿組織（ＷＴＯ）承諾的基礎上，進一步自由化的項目，有些則是屬於落實ＷＴＯ義務的議題。對於前者，除非我國自願在現階段檢討改革，否則將會是未來啟動台美ＦＴＡ或ＴＰＰ後的談判議題，彈性較大。但對於後者，因涉及既定義務的滿足，美方要求起來自認為理直氣壯，也會是主要的壓力來源。也由於這些問題無法拖到未來加入ＦＴＡ或ＴＰＰ後再談，必須先予以化解後，方可能創造取得談判資格的條件，才會被稱為ＴＰＰ的入場券。

在美方所關切的「入場券」型的貿易障礙中，大概以開放含有瘦肉精的美國豬肉進口最具爭議性，也很可能是ＴＩＦＡ復談後最困難的一題。在ＷＴＯ的規範下，肉類產品中的瘦肉精（萊克多巴胺）的最高殘留值，原則上應該依據國際標準，但若是進口國因飲食習慣等原因，要訂出比國際標準更嚴格的限制，則必須建立在充分的科學證據上。

去年初引發爭議的美牛事件，其實是美豬的前哨戰。在美牛一案中，政府最後依據學界論證及聯合國食品法典委員會（Codex）所訂的殘留值，訂出開放標準。然而Codex的國際標準，實際上也包含了豬肉及雞、鴨等家禽，所以過去許多萊克多巴胺安全無虞的論述，也一樣適用在豬肉上。更何況已經接受牛肉的國際標準後，未來要對豬肉差別待遇，所需要的科學證據就要更充分。

國產牛的產量僅佔國人消費的七％，而且市場區隔明顯（國產牛多屬溫體供應），因此開放美牛並不至於影響國內養殖業。但即便如此，還是引起很大的爭議。豬肉是國人最主要肉類產品，國產豬的產量可滿足九十％的需求；美豬（特別是內臟及豬腳）價格遠低於國產，一旦擴大進口，影響不是美牛可以比擬，激烈反彈已可預見。何況在政府「牛豬分離」的政策下，話已說死，都增加解題的難度。

因應之道有三：一、ＴＩＦＡ既是「架構協定」，希望萊劑豬肉不列「早收清單」；先將「架構」搭起，延後處理此一議題，這對雙方應皆是上策。二、國人飲食習慣異於西方，萊劑美牛雖開放，但滿街皆見「本店使用澳紐牛肉」的告示，或可據此向美國力爭。三、美豬其實原本即可進口，只是不得含有萊劑，因此還有用其他開放議題以交換美方不再拿此做文章的空間。

當然，最重要的，還是要提升國產豬的品質及行銷，因為未來台美ＦＴＡ或ＴＰＰ皆將朝向更加開放的境界邁進，即使暫時有緩衝期，豬肉的門禁恐怕最終還是必須打開，因此強化競爭力，才是養豬產業長期發展的不二法門，最終或許仍須以「本店使用本土豬肉」的告示來解決問題。