China's Elimination of ECFA "Benefiting Taiwan" Measures Augurs New Script towards Taiwan Post-Election
China Times Editorial, August 18, 2023
During Vice President William Mr. Lai’s foreign visit to Paraguay, mainland China’s Ministry of Commerce levied anti-dumping duties on polycarbonate imported from Taiwan and accused Taiwan of breaching WTO rules. China also expanded the investigation on the trade barriers imposed by Taiwan on 2,455 mainland products. The zero-tariff preference enjoyed by polycarbonate in accordance with the early harvest list of the Economic Cooperation Framework Agreement (ECFA) signed by the two sides of the Taiwan Strait has been cancelled. The Taiwan Affairs Office (TAO) of the State Council also implied that the preferential tariffs in ECFA's early harvest list may also be cancelled in total. This is the clearest message sent by Beijing on ECFA up to date.
The termination of ECFA, however, requires both sides of the Taiwan Strait to finalize it via the formal negotiation channel. The problem is that, as the ruling Democratic Progressive Party (DPP) refuses to recognize the "1992 Consensus," mainland China has been ignoring Taiwan, and it would be impossible that they would opt to reinstate a formal negotiation just to terminate ECFA.
What is more, the current ECFA is nothing but a "framework," with preferential tariffs in the early harvest list only; the trade in goods and the trade in service have become "unfinished buildings." To know if ECFA could be continued, Taiwan has to wait for the announcement by the General Administration of Customs of the mainland’s State Council at the end of each year.
On April 12, the mainland’s Ministry of Commerce initiated an investigation into the trade barriers imposed by Taiwan on 2,460 items of Chinese products. The investigation will be completed on January 12, 2024, one day before Taiwan's presidential election. If the investigation is completed in accordance with the procedure, then mainland China can announce its conclusion depending on the result of Taiwan's presidential election. If the DPP's Lai is elected, then the unilateral preferential tariffs given by the mainland to Taiwan will evaporate in one night, leaving ECFA with only a name without content.
The anti-dumping investigation was initiated in November last year based on market and economic considerations. But the levy of anti-dumping duties is political, timed to counter Lai's transit through the United States. As a matter of fact, mainland China's preferential policy toward Taiwan is meant to benefit Taiwanese businesses in the mainland. The big businesses in Taiwan, such as the Formosa Chemicals and Fibre Corporation and the CHIMEI Corporation, which are negatively affected by the levy, are not its concern. Consequently, "Lai elected, ECFA lost” may become the mainland’s new script for Taiwan after the election.
As such, if the DPP lost in accordance with mainstream public opinion, the Taiwan Strait will return to peace and stability. The economic problems raised in the past few years could be tabled and resolved in the formal negotiation after the new president takes office on May 20, 2024. The continuation of ECFA and the deepening of preferential treatment will also present no problem.
On the other hand, if Lai got elected, given his die-hard position on Taiwan independence, mainland China would exert even greater economic, diplomatic, and military pressures on Taiwan.
Although Mr. Lai claims to break up from de jure independence, his narrative on the refusal of the “One China” policy is basically finalized. This is going even a few steps backward than the administration of President Tsai Ing-wen.
Mainland China’s elimination of ECFA preferential treatment towards Taiwan is reaching the point of no return. If cross-strait relations under the Tsai administration is bumpy, but not capsized, then Mr. Lai's success in the election could bring about disaster! This is not an alarmist’s talk, this is a crisis in the making for every Taiwanese.
From: https://www.chinatimes.com/opinion/20230818003443-262101?chdtv