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EU-Taiwan trade arrangements on right track: envoy

Focus Taiwan News Channel

EU-Taiwan trade arrangements on right track: envoy

8 January 2011

By Chris Wang

Taipei, Jan. 8 (CNA) Negotiations on trade arrangements between the European Union (EU) and Taiwan are on the right track despite imbalance in bilateral trade and investment, according to a top EU diplomat in Taipei.

While they are still exploring the feasibility for a deal similar to a free trade agreement, both sides have already started to collaborate in various areas that could have a huge impact, said Guy Ledoux, chief of the European Economic and Trade Office in Taipei, the bloc’s representative office in Taiwan in the absence of official bilateral ties.

Taiwan has turned to other major trade partners, including the EU, for possible FTA’s after signing a historical pact called the Economic Cooperation Framework Agreement (ECFA) with China last June to liberalize two-way trade.

In an interview the Central News Agency on Friday, Ledoux said that the EU received positive and constructive feedback from Taiwan in the annual consultation held in Brussels last November, which showed that the process is "on the right track."

"Brussels hasn’t forgotten Taiwan…If there is will on the Taiwanese side to make progress, the EU will also find the resources to engage in dialogues, " Ledoux, said, noting that the EU has never interrupted the annual consultations with any excuse.

Ledoux will soon be re-assigned to the Philippines after heading the EU office in Taiwan for four years.

The EU and Taiwan have started collaboration in three different areas — investment, public procurement and standards, he said, and if someday there would be negotiation on the Trade Enhance Measures (TEM), the temporary name of an EU-Taiwan FTA, those three elements will be part of such an arrangement.

However, there have been two major imbalances between the two sides — export and investment — which "need to be corrected, " he said.

According to the diplomat, Taiwan has a significant amount — roughly 30 billion Euros — of export to the EU and, while the EU is Taiwan’s largest foreign investor, Taiwanese companies have invested very little in EU countries.

There has not been any progress in terms of Taiwan’s investment in Europe during his four years in Taiwan despite the energy his office has devoted to investment promotion, he said.

"Maybe we haven’t touched the right button, " he lamented, adding that investing in China has been also the "easy choice" for Taiwanese companies.

The French-born diplomat said Taiwanese businessmen tended to forget the size of the European economy, which is around 14 trillion euros, compared to China’s 5 trillion.

While a two-percent growth for Europe is not as impressive as a 10-percent growth in the Chinese economy, the EU is adding 300 billion euros — about the size of the Taiwanese economy — to the size of its own economy each year, he noted.

He hoped that the recent Schengen visa exemption to Taiwanese passport holders will make it easier for Taiwan business people to fly to Europe to meet partners and explore business opportunities.

Ledoux also said he didn’t think a European Commission decision last December to slap a total of 433.92 million euro fines on a group of Taiwanese manufacturers would impact bilateral trade relations.

AU Optronics, Chi Mei Optoelectronics Corp., Chunghwa Picture Tubes Ltd. and HannStar Display Corp. were fined for for allegedly fixing prices in violation of the EU’s competition rules after Samsung, their South Korean competitor, blew the whistle.

On the anger of some Taiwan business leaders over Samsung’s behavior, Ledoux said the EU underlined the importance of a level playing field.

Even though mnay people said the mechanism was unfair, it is "the make sure that somebody’s going to blow the whistle to tell you that something is going on."

Regarding media reports of a possible lifting of the EU’s 21-year arms embargo on China, Ledoux said that there was no new element that would have influence on why the EU should suddenly change its position, but he declined to elaborate.