Both Sides Win
from Cross-strait Economic Links
The two
sessions of talks between Chairman Chiang Pin-kung of Taiwan’s Straits Exchange
Foundation (SEF) and Chairman Chen Yunlin of Mainland China’s Association for
Relations Across the Taiwan Straits (ARATS) in 2008 laid the foundation for the
normal operation of systematic negotiations between the two sides. The third
Chiang-Chen talks will be held in the first half of 2009; the topics discussed,
and the direction in which cross-strait relations will move in the future, will
not only involve interest of the peoples of Taiwan and China but also attract
intense attention of the international community.
The time and place of the third round of talks are not yet finalized,
but four major issues will definitely be addressed: joint efforts on cracking
down on crimes, regularly scheduled Cross-strait passenger flight services,
financial cooperation, and opening to Mainland Chinese investment in Taiwan.
According to Mainland Affairs Council Deputy Minister Fu Don-cheng, the
government is still soliciting a broad base of opinion about the Economic
Cooperation Framework Agreement (ECFA) with which so many people are so
concerned and it is not yet on the agenda for the talks. If the needed
consensus is achieved and the necessary preparations made, however, preliminary
discussion of related issues could possibly be included in the upcoming
Chiang-Chen talks.
Negotiations on the four big issues
Deputy Minister Fu explains that discussions on cracking down on
criminal activity will focus on cross-border cooperation in criminal
investigation, the establishment of a mechanism for information exchange, and
mutual assistance in judicial matters. On scheduled passenger flights, the
meeting will emphasize the normalization of daily charter flights and the
expansion of cooperation in air transportation. In the area of financial
cooperation, the negotiations will focus on the signing of a memorandum of
understanding on cooperation in the oversight of the banking, insurance, and
securities and futures businesses, as well as on the establishment of a
mechanism for currency settlement. If the two sides reach a consensus on these
three issues, an agreement covering them can be signed.
The
deputy minister points out that the issue of Chinese investment in Taiwan
involves the establishment of enterprises, the bringing in of personnel, the
residence in Taiwan of spouses, and other matters that require detailed
communication between the two sides, and so both sides have agreed to have a
thorough dialogue first to achieve a full consensus on the different rules. The
exchange of funds involves two-way interaction, Fu points out, but in the past
most investment went in a single direction—from Taiwan to China, with Chinese
investment in Taiwan being extremely limited. The Executive Yuan opened up
investment in Taiwan by Qualified Domestic Institutional Investors (QDIIs) from
China last year, but no such investment has been realized so far because China
still restricts investment in Taiwan by its people. More negotiation and
coordination between the two sides will be needed before Chinese investment
will be able to come in and inject economic energy into Taiwan’s market.
The
Taiwan side hopes that the first areas of investment in Taiwan opened to
Mainland China will include real estate, manufacturing, services, and the
i-Taiwan 12 projects, and this will, if feasible, be included in the upcoming
dialogue. The government will also pursue negotiations with China on other
issues of concern to Taiwanese businessmen, including the signing of agreements
for the protection of investment and the avoidance of double taxation. These
issues could possibly also be included in the third round of talks.
