Opposition to service trade pact slows down talks with China: MOEA


TAIPEI–Strong opposition in Taiwan against a cross-strait service trade agreement has slowed down the pace of negotiations on further economic exchanges between Taipei and Beijing, the Ministry of Economic Affairs (MOEA) said Saturday.

In June, Taiwan and China signed the service trade pact in Shanghai. It was considered the most significant economic accord signed between the two sides since the landmark Economic Cooperation Framework Agreement (ECFA) was inked in 2010.

After the service trade agreement was reached, both sides have continued their negotiations under the ECFA, with the aim of concluding the talks and even signing a product trade agreement by the end of this year.

However, the service trade pack has faced strong resistance from the opposition political parties, including the Democratic Progressive Party, and failed to clear in a special session of the Legislative Yuan, which ended on Aug. 9.

The academic and private business sectors have also voiced fears that the pact will bring about negative impact on local services businesses and eventually hurt the local job market.

Under the service trade pact, Taiwan has agreed to allow China to run businesses in fields including printing, car rental, cargo transportation, gondolas, beauty parlors and salons, online gaming and funeral services.

Beijing, meanwhile, agreed to open businesses, such as e-commerce, printing, hospitals, construction and transportation to Taiwanese investors.

Officials from the MOEA said due to the stiff resistance against the trade pact, negotiators on the product trade pact have proceeded more slowly than expected, and simply focused on technical issues.

The officials said talks on the product trade agreement are more complicated than negotiations on the service trade pact as the product trade agreement involves tariff reductions for more than 8,000 items of goods. They added that the government needs more time to communicate with local enterprises.

However, they said the government has maintained its goal to complete the talks on the product trade agreement by the end of this year.

President of the Chung-Hua Institution for Economic Research Wu Chung-shu said the service trade pact, still pending in the Legislative Yuan, is an equivalent of a free trade agreement, and its openness to Taiwan’s service sector is greater than the commitment under the World Trade Organization.

Wu said the trade pact is expected to bring more benefits than harm to Taiwan in the long run, although it could fail to produce significant immediate effects in the short term.

Zhang Zhijun, director of China’s Taiwan Affairs Office, said he cannot understand why the service trade agreement is not well received in Taiwan, adding that Beijing has shown a good gesture to open its market in the pact.

Zhang said he hopes that the service trade agreement will be passed by Taiwan’s lawmakers and take effect as soon as possible so that Taiwan will be able to seize the opportunity to gain easier access to the huge China market.

Taobao.com, the largest C2C e-commerce business operator, said the presence of any Taiwanese counterparts in China will be welcome as competition will improve the business and is good for consumers.