Taiwan Lifts U.S. Pork Import Restrictions: Soft-Footed Pro-American Policy
By Lin Chu-chia
United Daily News, August 30, 2020
President Tsai Ing-wen announced on Friday the easing of import restrictions on American pork containing 10 parts per billion (ppb) of ractopamine, as well as 30-month-old American beef. This decision came out of the blue. I believe it will cause great controversy in Taiwan. The ruling Democratic Progressive Party (DPP), which was in opposition in 2012, had tried its best in the Legislative Yuan to block the opening. Hence, further opening of American pork and viscera of cattle by Kuomintang (KMT) were stopped. Unexpectedly, the DPP administration unilaterally opened American pork imports without any conditions and enough reasons. The claim that the DPP administration will be soft-footed if it encounters the US interests is once again proven.
First, the main reason why cattle less than 30-month old were allowed in that year was that the calf had the least chance of having mad cow disease; cattle viscera were excluded because they contain much higher ractopamine. American cattle over 30-month old cause a higher risk to human health. Minister Chen Chi-chung of the Council of Agriculture was the pioneer who opposed the opening of American cattle then, but he made a total reversal of his position now. It is necessary for him to give our people more enough evidence to justify his change of policy position.
Second, our people consume on average about 5 kilograms of beef a year, but consume about 36 kilograms of pork, which are six times the consumption load of beef. If American pork containing ractopamine is allowed, the food risk will surely be much higher.
Third, Taiwanese people consume a small quantity of beef, and the proportion of domestically produced beef is also low. Therefore, the opening of American cattle imports has little impact on domestic beef market. What’s more, domestically produced beef is warm body beef, and the price is higher than that of frozen beef imported from the United States. The impact is relatively small; but even so, the DPP blocked it strongly in the Legislative Yuan. The amount of pork consumed in Taiwan far exceeds that of beef, and about 90 percent of the pork consumed is domestically produced. The opening of the American pig has a far more serious impact on domestic pig farmers.
Fourth, President Tsai announced the establishment of a NT$10 billion (about US$340 million) pig raising fund to compensate pig farmers for their possible losses. However, with the domestic annual pig production value standing at NT$ 70 billion, whether this fund is enough remains a big question.
Fifth, another puzzling question is that when the previous KMT administration wanted to open American cattle, the case had to be sent to the Legislative Yuan for deliberation, but not this time, President Tsai said. The DPP is the ruling party and has a majority in the Legislature Yuan. Such a controversial issue, of course, needs to be reviewed by the public, and the Legislative Yuan is a perfect institution to reflect public voices. What is the DPP administration afraid of, I doubt?
Sixth, President Tsai said that the main purpose of opening American pigs is to respond to changes in the international economic environment, especially the reorganization of the international industrial chain, and to improve economic and trade relations with the United States. We presume the decision is aimed at establishing free trade agreement (FTA) or bilateral trade agreement (BTA) with the United States, but we didn’t hear any related information in Tsai’s press conference. The opening of the American pork has caused great apprehension in Taiwan. Didn’t we unilaterally agree to open without any promise from the United States? Or is it just to support President Donald Trump’s policies, so the health of our people can be disregarded?
Finally, as of now, the opening is only unilateral by Taiwan, I suppose the main purpose lies in enhancing economic collaboration with the United States, in the form of FTA or BTA. However, judging from the standards of negotiations between America and other countries, there may still be a long way to go. In the meantime, the United States will require Taiwan to liberalize in all aspects, especially the opening of some service industries. Whether the people of Taiwan be willing to bear it is a big question mark.
In short, the DPP administration suddenly liberalizes American ractopamine pig to such a great extent that it not only contradicts its past position, but also fails to obtain any US promise. It seems that the policy of accommodating the United States is the only viable reason.
The author is a professor of economics at National Chengchi University.