Taiwan signs free trade pact with El Salvador, Honduras
May 8, 2007
Taipei — Taiwan has signed a free trade agreement with El Salvador and Honduras to expand trade ties between the three countries, the Bureau of Foreign Trade (BOFT) said on Tuesday.
The Taiwan-El Salvador-Honduras FTA, signed Monday in San Salvador, is Taiwan’s fourth FTA with foreign countries following the FTA with Panama, Guatemala and Nicaragua, and is Taiwan’s first trilateral FTA.
It was signed by Taiwan’s Economics Minister Chen Ruey-long, El Salvador’s Economics Minister Yolanda Gavidia and Honduras’ Minister of Development, Industry and Commerce Elizabeth Azcona, BOFT said in a statement.
Salvadoran President Antonio Saca and Honduran President Manuel Zelaya attended the signing ceremony.
The FTA is expected to take effect on January 1, 2008, after being approved in the three countries’ parliaments.
When the FTA takes effect, 3,590 items from Taiwan (57.1 per cent of Taiwan’s goods) will enjoy tariff-free entry into El Salvador, while 5,688 items (64.4 per cent) from El Salvador will enjoy the same treatment in Taiwan.
After 10 years, these figures will jump to 65.4 per cent for Taiwan and 93.1 per cent for El Salvador.
Furthermore, 3,881 items from Taiwan (61.9 per cent of Taiwan’s goods) will enjoy tariff-free entry into Honduras, while 6,135 items (69.4 per cent) from Honduras will enjoy the same treatment in Taiwan.
After 10 years, these figures will jump to 70.3 per cent for Taiwan and 93 per cent for Honduras.
Taiwan, El Salvador and Honduras will benefit from the FTA in terms of industry, agriculture, telecommunications, finance and investment, the BOFT statement said.
This FTA will serve as a gateway for El Salvadoran and Honduran goods to enter the greater Asian market, and for Taiwanese goods to enter markets in Latin America.
Taiwan is also holding FTA talks with the Dominican Republic, which like Panama, Guatemala, Nicaragua, El Salvador and Honduras, is among the 25 countries that have diplomatic ties with Taipei.
Fifteen of Taiwan’s 25 diplomatic allies are in Latin America and Taipei is trying to use trade to consolidate ties.
Taiwan is also seeking to sign FTA deals with countries that do not recognize Taipei, like the United States, Japan, South Korea Singapore and Chile, but they are reluctant to do so for fear of angering China, which sees Taiwan as its breakaway province.