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China-Taiwan

In early 2009, the Ma administration in Taipei and the Chinese government in Beijing began seriously discussing the possibility of signing a free trade agreement between the two. The stakes are quite large and so is the controversy around any such deal. Ever since 1949, when nationalists fled the mainland, China considers Taiwan a breakaway province that should fall under Beijing’s rule. Taiwan, on the other hand, has been trying to build and maintain its autonomy as a sovereign democratic state. Military tensions have surrounded this antagonistic relationship for 60 years, while China has been quite successful in asserting its "one China" policy among the world’s governments and alienating Taiwan diplomatically.

The new urge to sign an FTA comes after the nationalists lost power in Taiwan’s 2008 elections. China is, in fact, Taiwan’s top trading partner. Taiwanese businesses have built up strong investments in the mainland and the island’s political leadership is particularly concerned about losing economic strength in Asia once the China-ASEAN FTA starts coming into force in 2010.

The big question is whether a China-Taiwan FTA would trigger the start of Taiwan’s transition toward effective economic and political control by Beijing ("reunification"). In this regard, people have even been fighting over the possible name of the FTA. Taiwanese opposition forces insist that it should not be called a Comprehensive Economic Partnership Agreement, as originally proposed, because that is what China’s FTAs with Macao and Hong Kong are called. (Therefore, calling it a CEPA would insinuate that Taiwan has the same political status as these two special administrative regions of China.)

In June 2010, the governments of China and Taiwan signed an Economic Cooperation Framework Agreement (ECFA) which took effect in September 2010. The two governments intend to complete negotiations under this agreement by 2014. There have been major protests and much criticism of the deal in Taiwan.

last update: May 2012
Photo: WaDaNaBe / CC BY-NC-SA 2.0


ECFA talks to be finished in two years: president
Taiwanese President Ma Ying-jeou yesterday said the government will complete negotiations on the cross-strait Economic Cooperation Framework Agreement (ECFA) with China in the next two years, as well as deepen economic and trade relations with other countries to raise the nation’s economic competitiveness.
International community responds positively to ECFA: MAC
The Economic Cooperation Framework Agreement (ECFA) signed between Taiwan and China has received positive feedback from the international community and has helped advance the country’s international image and development, said a Mainland Affairs Council (MAC) official Thursday.
WIKILEAKS: AIT doubts ECFA impact: cable says
Former American Institute in Taiwan (AIT) director Stephen Young was skeptical of President Ma Ying-jeou’s (馬英九) position that signing the Economic Cooperation Framework Agreement (ECFA) would open the door for Taiwan to pursue free-trade agreements (FTA) with other partners, a US cable recently released by WikiLeaks showed.
Taiwan firms reshaping cross-Strait relations
Taiwan industrial companies have been reorganizing resources on both sides of the Strait to sharpen their competitive edge in the wake of tariff reductions that took effect earlier this year.
ECFA debate marred by faulty reasoning
One year after the Economic Cooperation Framework Agreement was signed by Taipei and Beijing, Taiwan’s opposition Democratic Progressive Party has declared the ECFA "myth" busted, while the ruling Kuomintang continues to tout its many benefits.
DPP says ECFA claims are overblown
Taiwan’s Democratic Progressive Party yesterday criticized the cross-strait Economic Cooperation Framework Agreement as “part fantasy,” saying it had failed to generate any substantial gains for Taiwan’s economy.
ECFA benefiting wealthy: report
People who possess large amounts of capital appeared to reap benefits from the Economic Cooperation Framework Agreement (ECFA), while those on the lower end of the economic scale absorbed the costs, a recently released report on the cross-strait China-Taiwan trade pact signed in June last year suggested.
Taiwan’s trade link with China set to grow
Taiwan is only “a quarter to a third” of the way through opening its economy to the Chinese mainland, President Ma Ying-jeou has said, indicating that he intends to expand greatly a free-trade deal that Taiwan’s opposition says has already gone too far.
Calls for safeguards surge as Taiwan enters post-ECFA era
Despite much controversy, the Ma administration proceeded to sign an Economic Cooperation Framework Agreement with China effective September 12, 2010, and Taiwanese people woke up to find themselves plunged into a post-ECFA era.
ECFA to widen income disparity: forum
Experts at a forum on economics yesterday said the Economic Cooperation Framework Agreement (ECFA), which came into force yesterday, would exacerbate income disparity and unemployment in Taiwan.