US-Korea FTA ’setback for Taiwan’
Bangkok Post, Thailand
US-Korea FTA ’setback for Taiwan’
1 July 2007
Taipei (dpa) - The US-South Korean free trade agreement (FTA) will seriously hurt Taiwan because South Korea and Taiwan are both main trading partners of the US, the Economics Ministry said on Sunday.
In a report carried by the United Evening News, the ministry estimates that the US-South Korean FTA, signed Saturday, would wipe out 2 billion US dollars from Taiwan-US trade and cause Taiwan to lose 20,000 jobs.
The impact on Taiwan translates into 2 billion US dollars’ export to the US or 5 per cent of Taiwan’s total export, the report said.
The biggest victims will be Taiwan’s traditional industries - textile, garment, bicycle, plastics and rubber shoes.
The report also warned that the US-South Korean FTA could hurt US investment in Taiwan as there would be greater incentives for US firms to invest in South Korea.
The report urged Taiwan to speed up FTA talks with the US to avoid Taiwan’s being marginalized by foreign countries and regional free- trade zones.
Taiwan’s economy relies on export and the US is Taiwan’s third- largest trading partner after China and Japan.
Taiwan has been seeking to sign an FTA with the US, but Washington has been reluctant to sign it, apparently for fear of angering China, which sees Taiwan as its breakaway province.
Taiwan is recognized by only 24, mostly small, nations. So far Taiwan has only signed FTAs with Panama, Guatemala, Nicaragua, El Salvador and Honduras, which have diplomatic ties with Taipei.
