Nearly 45 p.c of Taiwan’s exports went to China and Hong Kong in 2020, in contrast with simply 14.5 p.c to the United States, 6.8 p.c to Japan and 6.6 p.c to the EU, according to World Trade Organization statistics.
The state of affairs is considerably higher on the import aspect, with China accounting for 22.2 p.c of Taiwan’s abroad purchases, adopted by 11.5 p.c from the United States.
Trade between the United States and Taiwan has boomed over the previous two years, pushed by elevated demand for semiconductors, private protecting gear and different items as a results of the coronavirus pandemic.
But Taiwan would really like to increase its financial ties with the United States as it diversifies its trade away from China over the subsequent 20 to 30 years, Deng stated.
Earlier this week, the United States and Taiwan formally launched talks on the brand new U.S.-Taiwan Initiative on Twenty first-Century Trade, regardless of Beijing’s sturdy objection.
“China firmly opposes all forms of official interaction between the Taiwan region and countries having diplomatic ties with China, including negotiating or concluding agreements with implications of sovereignty and of official nature,” Chinese Foreign Ministry spokesman Zhao Lijian stated Tuesday.
Taiwan’s political leaders “need to give up on the idea that they could seek independence with U.S. support. Otherwise the higher they jump, the harder they will fall,” Zhao stated.
China additional isolates Taiwan by bullying international locations that deal with it as an impartial nation, as occurred to Lithuania earlier this yr when it agreed to let Taiwan open a consultant’s workplace within the Baltic republic.
The new initiative with the United States guarantees to be far lower than the full-fledged free trade settlement that Taiwan has lengthy sought. But Deng stated it’s nonetheless an vital improvement as a result of it should set up “a very solid legal infrastructure” for trade between the 2 sides.
That will repay over the long run by aligning requirements and coping with rising points, even when it doesn’t present substantial new market entry positive aspects within the nearer time period, Deng stated.
The new talks are additionally important as a result of there may be each expectation of manufacturing a concrete settlement for the 2 international locations to signal, as opposed to the extra open-ended dialogue underneath the longstanding U.S.-Taiwan Trade and Investment Framework Agreement, he stated.
Deng stated he hoped negotiations on the Twenty first Century trade pact might be completed by the point the United States hosts the annual APEC leaders summit in late 2023, if not earlier than then.
After former President Donald Trump turned conventional free trade trade agreements right into a potent political weapon within the 2016 presidential marketing campaign, the Biden administration has proven little curiosity in negotiating new offers that scale back tariffs.
The White House’s nascent trade agenda focuses as an alternative on elevating labor and environmental requirements; decreasing nontariff obstacles in areas such as agriculture; and growing guidelines on matters such as regulatory practices, anti-corruption, digital trade, state-owned enterprises and nonmarket insurance policies and practices.
Many of the problems that the Biden administration plans to negotiate with Taiwan are additionally on the agenda for the proposed Indo-Pacific Economic Framework for Prosperity — a a lot greater proposed trade initative between the United States and 13 different international locations.
Taiwan had hoped to be a part of the IPEF, however the Biden administration — in a nod to China’s sensitivities about Taiwan being handled as a sovereign nation — left it out so as to entice extra participation from different international locations within the area.
For now, Taiwan’s focus is on forging a bilateral deal with the United States, somewhat than interested by how the settlement may be linked to the IPEF sooner or later, Deng stated.
However, it might be simpler — and faster — for the U.S. and Taiwan to attain settlement on points additionally being negotiated in IPEF, creating the potential for the U.S.-Taiwan pact to turn into “a model” for the larger regional pact, Deng stated.
Deng additionally stated he stays hopeful the proposed U.S.-Taiwan deal might morph right into a free trade settlement when the U.S. political surroundings is extra “agreeable.”
“It’s always our goal,” Deng stated. “But we don’t need to push something which cannot succeed now.”
