Although the title “Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu” at the WTO is not the most desirable, the need to maintain “normalization of economic and trade relations” with the People’s Republic of China (PRC) under the WTO framework does not necessarily mean that Taiwan has to sacrifice its political autonomy for economic benefits. However, this is what the incumbent government in Taiwan is doing (“ECFA poses three likely outcomes for Taiwan,” March 5, page 8).
The central issue on an economic cooperative framework agreement (ECFA) is not about normalizing trade relations with the PRC. It’s about the trade-off that comes when we consider giving up our independent sovereignty, Taiwan’s “de facto” political autonomy, for economic/trade benefits. Furthermore, sovereignty is a public good and belongs to the 23 million people of Taiwan.
A negative outcome of an ECFA is the erosion of Taiwan’s autonomy which will be borne by all its citizens, yet the benefits of the agreement will only extend to those sectors negatively affected by the free-trade agreement (FTA) between the ASEAN nations and the PRC.
It is like asking the general public to bear the burden of pollution without penalizing those firms who dispose of their industrial wastes. In socio-political terms, it would be more justifiable for the government to adopt some remedies through industrial adjustment policies or even social policies in sectors such as petrochemicals, textiles/clothing, machinery and others affected by the ASEAN-PRC FTA.
What evidence is there that Taiwan’s sovereignty will be eroded by signing an ECFA with the PRC? One could give a list of concrete examples, which is too long to be published here. Yet, the fact the contents of an ECFA were not based on the equilateral basis of the WTO principle, but on Chinese President Hu Jintao’s (胡錦濤) six points erodes Taiwan’s political autonomy.
The erosion of Taiwan’s sovereignty in signing an ECFA includes the absence of a guarantee that Beijing won’t block Taiwan from signing FTAs with other countries, which is a legitimate right for any WTO member.
While President Ma Ying-jeou’s (馬英九) administration claims an ECFA would mean Taiwan won’t be marginalized from economic integration, one has to point out that, without signing FTAs with other major trading partners, Taiwan will be locked into the “Greater China Economic Zone” in the short run, and get sucked into the PRC’s political orbit over the long term.
The PRC has been and still is an authoritarian regime. A marriage of convenience between a democratic Taiwan and an authoritarian PRC is doomed to fail economically and politically.
Moreover, the PRC’s relationship with the US and other industrialized democracies in the world is subject to instability and is unpredictable. Should the US-PRC relationship deteriorate in the near future, Taiwan’s inclusion in the “Greater China Economic Zone” will make the country vulnerable to external shocks from Washington.
One has to remind the Ma administration that globalization without independent sovereignty is like a piece of drifting wood in the ocean. Anyone can claim it. Ma should not trade away Taiwan’s sovereignty, which belongs solely to the people of Taiwan, for presumable economic benefits from a trade pact with the PRC.
Peter C.Y. Chow is professor of economics at the City University of New York and a research associate of the National Bureau of Economic Research.
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