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Taiwan should focus on joining RCEP, instead of TPP: scholars

Focus Taiwan News Channel

Taiwan should focus on joining RCEP, instead of TPP: scholars

23 November 2012

By Scarlett Chia and Ann Chen

Taipei, Nov. 23 (CNA) Taiwan should focus on joining the Regional Comprehensive Economic Partnership (RCEP), instead of the Trans-Pacific Partnership Agreement (TPP), local scholars said Friday.

Mignonne Chan, executive director of the Chinese Taipei Asia-Pacific Economic Cooperation Study Center, said at a forum on regional integration that if Taiwan joins negotiations under the RCEP, the potential economic benefits for Taiwan will be twice as great as those under the TPP.

The RCEP was first discussed at the 19th Association of Southeast Asian Nations (ASEAN) Summit in November last year.

A RCEP framework was set out between the 10 ASEAN member states — Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam — that map out the general principles for broadening and deepening ASEAN’s engagement with its free trade agreement (FTA) partners.

ASEAN members’ FTA partners include Australia, New Zealand, China, India, South Korea and Japan.

The RCEP market is estimated to have a combined population of more than 3 billion and a combined gross domestic product (GDP) of about US$19.9 trillion, according to 2011 official data.

The integrated market will be the largest in the world, Lin Chien-fu, professor of economics at National Taiwan University, said at the forum.

He added that the combined GDP, population, total trade volume of the RCEP will be bigger than the TPP, even if Canada, Japan, and Mexico are to join the TPP in later stages.

Now that a three-way FTA between Japan, China, and South Korea is underway, with the ongoing negotiations between ASEAN plus 6 states, Taiwan should seek to join the RCEP or try to negotiate FTAs with individual ASEAN countries to try to break into the world’s largest regional market, he said.

Lin also suggested that Taiwan seek vertical integration with Japan by taking advantage of the Economic Cooperation Framework Agreement that Taipei signed with Beijing.

"Taipei could be the shortest path from Tokyo to Beijing," he said, suggesting that Taiwan partner up with Japan and become a vital link between the world’s second and third biggest economies.

He continued that Taiwan should sign an FTA with Thailand, as the latter is one of Taiwan’s largest trading partners and holds an important key to Taiwan’s access into the European market.

He cautioned that Taiwan’s export-reliant economy should avoid putting too much emphasis on China, and should diversify its exports to other regional market, especially the emerging markets in the Asia-Pacific region.