Trade Liberalization, Substance over Form

Trade Liberalization, Substance over Form
China Times editorial (Taipei, Taiwan, ROC)
A Translation
March 18, 2013

Summary: Taiwan-US Trade and Investment Framework Agreement (TIFA) talks were suspended six years ago. Last week they finally resumed. The participants issued two joint statements. They organized two working groups. They offered a surfeit of diplomatese. The verbal exchange concluded amidst dense rhetorical fog. The government said the meeting was fruitful. But it was more symbolic than substantive. An accurate evaluation of TIFA effectiveness and pragmatic follow-up consultations are critical to Taiwan-US trade policy and Taiwan's overall trade policy.

Full Text below:

Taiwan-US Trade and Investment Framework Agreement (TIFA) talks were suspended six years ago. Last week they finally resumed. The participants issued two joint statements. They organized two working groups. They offered a surfeit of diplomatese. The verbal exchange concluded amidst dense rhetorical fog. The government said the meeting was fruitful. But it was more symbolic than substantive. An accurate evaluation of TIFA effectiveness and pragmatic follow-up consultations are critical to Taiwan-US trade policy and Taiwan's overall trade policy.

Consider the TIFA agreement's substance. Its purpose is to establish a platform for economic and trade dialogue. Its purpose is to enable Taipei and Washington to promote bilateral trade and investment. It contains no substantive provisions. It does not even spell out the frequency with which TIFA should convene committee meetings. Taipei and Washington have numerous formal and informal channels of communication outside of TIFA. Therefore, strictly speaking, whether TIFA convenes or not, will not substantially affect Taiwan-US economic and trade interaction. In 1998 inadequate protection of intellectual property rights (IPR) and other issues led to a six year hiatus. But during that time our government gained the approval of the United States and other WTO members. It gained access to the World Trade Organization (WTO) in 2002. South Korea and the United States have no TIFA relations. Nevertheless they negotiated a Free Trade Agreement (FTA). That is the best example.

Therefore the suspension and resumption of TIFA talks is basically a matter of show, both for Taipei and Washington, but especially for Washington. The suspension of talks began with the US beef imports controversy. The resumption of talks is a symbol that the disagreement has been resolved. Therefore the suspension and resumption of TIFA talks has long been more symbolic than substantive significanc. In other words, if the meeting proceeded smoothly, its purpose has already been achieved. Any concrete progress is merely icing on the cake.

Consider the US pork imports controversy. It is similar to the previous U.S. beef imports controversy. As long as Washington feels the need, it will raise concerns whether TIFA talks resume or not. Therefore people should not perceive this as a basis on which to support TIFA. Everyone looks forward to the Taiwan-US Free Trade Agreement (FTA) and our government's accession to the Trans-Pacific Partnership Agreement (TPP). Washington has yet to offer an official response. But talks were suspended for six years. Our government's liberalization is not yet complete. Under the circumstances, we cannot expect Washington to offer an official response yet. Our government raised these issues mainly to mollify domestic sentiment. The lack of progress was expected.

The resumption of talks is largely symbolic. But TIFA remains a substantial prize. Especially noteworthy are signs that Taipei and Washington may sign investment agreements. Taipei has been promoting investment agreements with Washington for ten years, without concrete results. This time, Taipei and Washington jointly announced an "International Investment Statement of Principles." They established an investment working group. The two sides have achieve a high degree of consensus. A Taipei-Washington agreement on investments should be just around the corner.

Consider the direction of TIFA following the resumption of talks. Everyone questions Washington's too high asking price. But to be fair, whether Taipei and Washington sign an FTA, or Taipei joins the TPP, the economic and trade impact on the United States and other TPP members will be limited. The "China Factor" may involve considerable extra political risk. Therefore it is not surprising that Washington is demanding a high asking price. Taipei is in a difficult situation. For it to take part in regional economic integration, it must indeed pay a price.

Whether TIFA talks resume, or whether we wish to join the TPP, we will be subject to the demands of the United States or other countries. These requirements may provoke a domestic backlash or impact government administration and industrial restructuring. But if the result enables industry and the people on Taiwan to benefit equally, then Taiwan will clearly being taking a giant leap forward.

We have been weighing these points for years. The bottlenecks in the way of liberalization have slowly emerged. Everyone tends to accuse a minority of agricultural workers and sunset industries of being the stumbling blocks to a solution. But the real problem is the government's style over substance mentality. This phenomenon is not confined to TIFA. It applies to many policies.

The government's liberalization of public works is weak. Almost all recent reform and liberalization relate to cross-Strait exchanges. But cross-Strait exchanges do not really qualify as liberalization. At best we are playing catch-up. Various agencies have inventoried their regulations and concluded that they have no problems. But our European, US, and other trade partners are not buying it. They repeatedly question our resolve. They think we care only about the number of agreements we can sign, not about their quality.

Another example is the US pork imports controversy. If Washington makes concessions, we must make concessions in return. But our pockets are empty. In fact, the FTA or TPP are ultimately economic and trade interests. We have relatively little to offer in terms of natural resources. If we cannot offer something else, these FTA or TPP strategies will be difficult to implement, no matter how many policy road maps we draw up. In short, if our proposals are continually rebuffed, the government will have only itself to blame. If that happens, do not attempt to use industry as an excuse.
   
中時電子報 新聞
中國時報 　2013.03.18
社論－推動貿易自由化 實質重於形式
本報訊

    　台美「貿易暨投資架構協定」會議（ＴＩＦＡ）在停開六年後，於上周終於復談。本次會議在發表二個共同聲明、組成二個工作小組，加上許多外交辭令、似有似無的言語交鋒下落幕。政府說本次會議成果豐碩，但也有象徵意義大於實質的質疑。我們認為，正確的評估ＴＩＦＡ成效，務實的推動後續協商，對台美乃至於台灣整體對外經貿政策而言，具有關鍵意義。

    　從ＴＩＦＡ協定內容觀察，其本意就只是建立一個經貿對話平台，以促進台美雙邊貿易及投資，沒有任何實質規定；即便連本次召開的ＴＩＦＡ委員會的開會頻率，也無明文。而台美在ＴＩＦＡ以外，各部會間還有許多正式、非正式溝通管道，因此嚴格來說，ＴＩＦＡ的開與不開，並不會實質影響台美經貿互動。一九九八年時，ＴＩＦＡ曾因智財權保護不足等問題，停開了六年，但其間我國還是取得美國等會員同意，於二○○二年順利加入世貿組織(ＷＴＯ)，而韓國與美國在完全沒有ＴＩＦＡ的情況下，一樣洽簽了自由貿易協定（ＦＴＡ），就是最好的例子。

    　所以ＴＩＦＡ的停開與復談，在性質上原本就是一齣台美（特別是美國）藉此表態的戲。停開為表達牛肉問題而起，而復談則象徵歧見解決。所以本次ＴＩＦＡ復談，本來就是重形式輕實質，亦即，能順利舉行會議，目的便已達成；若有任何具體進展，都是進一步為順利舉行加分。

    　至於美豬問題，就如同過去的美牛問題一樣，只要美國認為有需要，無論ＴＩＦＡ復談與否都一樣會提出關切，因此各界其實無需以此議題，作為是否支持ＴＩＦＡ的判斷標準。而如各界所期盼的台美自由貿易協定（ＦＴＡ）、支持我國加入「跨太平洋伙伴協定」（ＴＰＰ）等議題，美國都沒有正面回應。然而在停開六年、我國自由化準備尚未到位等情況下，本來就不可能期待美國給予正面回應。我方提出這些議題，看來主要是為國內交代之用；沒有進展並不令人意外。

    　雖然復談以形式為重，但本次ＴＩＦＡ仍有相當的實質收獲。其中最值得注意的，可能是台美簽署投資協定已初見曙光。我國推動與美洽簽投資協定，至今已有十年光景，但始終欠缺具體進展。本次台美雙方不但共同發布了《國際投資原則聲明》，更進一步成立投資工作小組，顯示雙方對此具有高度共識，台美投資協定應該指日可待。

    　回到ＴＩＦＡ復談後的努力方向上。各界對於美國姿態太高、「要價」不菲，頗有質疑。但平心而論，台美洽簽ＦＴＡ或加入ＴＰＰ，對於美國及其他ＴＰＰ成員國而言，經貿利益並不特別突出；在「中國因素」下，可能要額外付出的政治風險成本卻很高，因此美國拉高起價點或許也並不意外；台灣在如此艱難的處境下，要加入區域經濟整合，的確是要付出一些代價。

    　無論是ＴＩＦＡ的復談，或是想要加入ＴＰＰ，都可能會面臨美國或其他國家的各種要求，這些要求或許會引發國內的反彈，或者帶來行政與產業調整的衝擊，但若是其結果可以讓台灣的產業及人民雨露均霑、一起受益，那麼，這顯然還是台灣必須邁開大步前進的方向。

    　經過這幾年的盤點比對後，自由化的瓶頸其實已慢慢浮現。大家往往都怪罪少數農工弱勢產業是大局的絆腳石，但實際上真正的問題，很可能是在於政府重形式輕實質的心態，這樣的現象並不只ＴＩＦＡ有，其實很多政策也都是如此。

    　目前政府推動自由化工程亮點十分微弱。這幾年的改革開放項目，幾乎都與兩岸有關。但兩岸開放絕稱不上自由化，充其量只是「補課」而已。各單位盤點體制法規的結果，往往都回報沒問題、無落差，但歐美等經貿夥伴顯然不買賬，屢屢質疑我們的決心，更認為我們只在意協定的數量，而不在意質量。

    　又如美豬問題，若要美方讓利，就須拿出對價交換；但我們的口袋裡，卻好像也沒有更好的禮物。事實上，無論是ＦＴＡ或ＴＰＰ，最終都是以經貿利益為依歸，我國先天條件並不誘人，若後天又無法提供更多的甜頭，這種推動策略，畫再多的政策路徑圖恐怕也很難走得通。總之，未來若還是年年提案卻又年年碰壁，政府只能怪自己，千萬不要再把產業推出來當擋箭牌。