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Senior US official dashes FTA hopes

Taipei Times | Feb 08, 2007

Senior US official dashes FTA hopes

TRADE: A US negotiator denied that China could `veto’ FTA talks with Taiwan, but said that expanded cross-strait ties could boost support from the business sector

By Charles Snyder

A senior US trade official on Tuesday dashed Taiwan’s hopes that Washington could enter into negotiations on a US-Taiwan Free Trade Agreement (FTA) anytime soon, and said that Taiwan would have to gain strong support from the US business sector and Congress before an FTA could ever be considered.

Eric Altbach, the US Trade Representative (USTR) office’s top China and Taiwan negotiator, also urged the Taiwanese government to expand cross-strait economic ties, but backed off from statements by previous USTR officials that seemed to demand greater concessions to China as a prerequisite for FTA negotiations.

He also denied that China’s opposition to any US-Taiwan pact played a "veto role" in the Bush administration’s refusal so far to enter into FTA talks with Taipei.

Meanwhile, Rick Ruzicka, the American Institute in Taiwan’s (AIT) top trade official, said that the US did not require Taiwan to accept the "one-China" principle before Washington would agree to an FTA.

The two officials were speaking at a seminar on prospects for a US-Taiwan FTA at the Brookings Institution think tank.

’Full agenda’

Altbach said that the USTR and the Bush administration had a full trade agenda, and that "given the demands this full agenda places on USTR and other agencies ... it is frankly impossible for us to launch any new FTA negotiations at this time."

Altbach said that Taiwan had to open up cross-strait economic ties to meet the needs of multinational corporations that might seek to set up hub offices in Taiwan, although he did not phrase this as a requirement before Washington would consider negotiations toward a trade pact.

"China is playing an increasingly central role in regional production networks, not only as a site for final assembly, but also as an increasingly important market for both commodities and finished goods," Altbach said.

"Taiwan’s remaining restrictions on travel to Taiwan by PRC [People’s Republic of China] employees of Taiwanese companies and multinational companies, on outward investment to China, bans on cross-strait trade on certain products and the lack of cross-strait air and shipping all have a negative impact on Taiwan’s competitiveness," he said.

Welcoming the "progress" that Taiwan is making in establishing "a more liberal regime in cross-strait links," he cautioned, however, that "it takes place in the context of very rapid increases and integration among other regional economies, and this is part of the context of [the US] evaluating policy changes."

Nevertheless, Altbach said, "the US government fully recognizes that decisions regarding these issues and how to move forward, these are decisions for Taiwan to make."

China’s influence

Asked whether China had the power to veto an FTA with Taiwan, the USTR official said "China does not have a veto over any US government political decision."

"We don’t have a serious understanding of exactly what China’s reaction would be if we were at the point of launching an FTA negotiation with Taiwan, because we’ve never been at that point," he said.

However, "it is an important issue ... and it would be part of the broader foreign policy context for US policymakers to consider," he added.

Ruzicka, AIT’s director for Trade and Commercial Programs, rejected claims that the US had demanded that Taiwan relent on its opposition to a "one-China" policy before an FTA would become possible.

Ruzicka said that "US trade officials at the highest level" deny that "Taiwan must declare acceptance of the `one-China’ principle before any kind of FTA can be started. Rather, it is important to recognize that entrepreneurs have established a supply chain, and that supply chain extends across the Strait. And it only makes sense to facilitate that. That’s a far cry from saying that there is a `one-China’ principle that Taiwan must accept."

The AIT official was responding to comments by Taiwan Thinktank chairman Chen Po-chih (陳博志) and another panelist, who implied that Washington’s call for a relaxation of cross-strait economic curbs were tantamount to a "one China" policy.

 source: Taipei Times