Taiwan: Cabinet to set up special task force for US FTA talks

Cabinet to set up special task force for US FTA talks
By Ko Shu-ling
STAFF REPORTER
Taiei Times, 28 May 2004, Page 1

The Cabinet will set up a special task force to handle the signing of a free-trade agreement (FTA) with the US in a bid to speed up the trade negotiations that have been stalled since the beginning of last year, Premier Yu Shyi-kun announced yesterday.

Yu also pledged that the annual budget for cultural development and social welfare, which he promised to pay special attention to during his second term as premier, would not crowd out the defense budget, because it would be prepared as a special budget.

Yu made the announcement yesterday afternoon during a tea party with the media in the Cabinet complex. During the 90-minute party, Yu unveiled the new Cabinet’s four policy goals with a focus on culture, society, politics and the economy.

On the economic front, Yu proposed developing an economic strategic alliance with diplomatic and non-diplomatic allies, particularly the US and Japan.

Among the many initiatives to develop an economic alliance is the US-Taiwan FTA, Yu said.

Panama, one of Taiwan’s diplomatic allies in Central America, was the nation’s first diplomatic ally to sign an FTA. The agreement, signed by President Chen Shui-bian (陳水扁) and his Panamanian counterpart Mireya Moscoso in Taipei on Aug. 21, came into force on Jan. 1.

US-Taiwan consultations under the Trade and Investment Framework Agreement (TIFA) are expected to resume next month at a high level, the first such meeting since 1998, according to Taipei Times sources in Washington.

That dialogue was suspended by Washington at the beginning of 2002 when the US decided it was getting nowhere in trying to solve a number of trade issues that had poisoned bilateral trade relations, primarily intellectual property rights (IPR) violations in Taiwan.

The resumption of the talks came after progress has been made on all four main trade frictions between the two sides — IPR, pharmaceuticals, telecommunications and agriculture.

US officials, however, predicted that no FTA is likely possible before the US presidential elections in November.

While some have argued that the prospect of the FTA might not sound as rosy as the government projected, Yu said that Taiwan simply cannot afford not to ink the agreement, especially with the US.

"We might not benefit much from the agreement but we’re bound to be worse off economically, politically and diplomatically if we don’t pursue it," he said.

Regarding the defense budget, Yu pledged that as the budget would come in the form of special budget, it would not crowd out other expenses in the annual budget.

"The Cabinet’s plans to outlay NT$700 billion for 11 items as a part of its arms-procurement spending through 2012 remains unchanged," Yu said, suggesting that the Cabinet would give the NT$67 million military budget the go-ahead when the budget proposal reaches the Cabinet.

The defense ministry has sent an NT$67 million special budget request to the Cabinet for review.

The budget will include eight diesel-electric submarines, 12 P-3C anti-submarine aircraft and three batteries of the Patriot PAC-3 anti-missile system.

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