Echoing former Taiwan High Speed Rail Corp (THSRC) chairwoman Nita Ing’s (殷琪) remark that migration of industries was what “killed” the high-speed rail business, Taiwan Solidarity Union Chairman Huang Kun-huei (黃昆輝) yesterday said the government’s plan to sign an economic cooperation framework agreement (ECFA) with China would just make the situation worse.
“Ing said that migration of industries [to China] ‘killed domestic airlines and the high-speed rail,’ but I think it’s only the beginning,” Huang told a press conference. “The situation will only get worse as the government continues to open up to and signs an ECFA with China.”
Before stepping down as THSRC chairwoman, Ing said in an inteview with Common Wealth (天下雜誌) magazine that the migration of industries to China was a key reason why THSRC was NT$400 billion (US$12.3 billion) in debt. She said that more than 2 million people have moved to China to work in the past 12 years because of the government’s policy to open up to China, reducing the average daily number of passengers from an estimated 230,000 to 80,000.
Huang agreed with Ing and said that after signing an ECFA with China, Taiwan’s markets would further open up to China which would have a grave impact on low-skilled workers and low-threshold industries, as more people would leave for China and the dumping of cheap Chinese products would be more common.
“[The ECFA] will cause an employment and wealth crisis for the Taiwanese,” he said.
Huang added that when former president Lee Tung-hui (李登輝) was in power and applied a more restrained policy toward cross-strait economic exchanges, “the average growth rate was 6.5 percent.”
“Since the government started opening up to China economically in 2001, however, average economic growth has dropped to around 3.8 percent,” Huang said. “A year after President Ma Ying-jeou [馬英九] took office and enhanced cross-strait exchanges, the economy has contracted by minus 3.52 percent.”
He said that if the former president’s cross-strait policies had been continued, “the per capita average income would have doubled.”
Straits Exchange Foundation (SEF) Vice Chairman Kao Koong-lian (高孔廉), on the other hand, argued that Taiwan would face a dilemma of being marginalized from major economic entities in Asia if it failed to speed up negotiations on signing an ECFA with Beijing.
Kao made the remarks in Taipei yesterday while addressing a forum of China-based Taiwanese businesspeople.
Kao said Taiwan would soon lose its global competitiveness and face the crisis of being marginalized by Japan, South Korea, China and ASEAN if it did not develop a closer economic relationship with China.
“We must step up efforts to sign an ECFA with China before ASEAN including China, Japan and South Korea form a regional economic bloc,” Kao told the forum.
Kao admitted that the proposed pact was not 100 percent conducive to Taiwan, but he emphasized that its advantages outweighed its disadvantages, adding that a smaller economic entity usually benefits from economic integration with a bigger one.
The penetration of Taiwanese products in the Chinese market began to deteriorate three years ago, but Kao said there was much room for development in the service sector.
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