AmCham's New White Paper

The American Chamber of Commerce in Taipei has just released its annual White Paper full of advice for the government (White Paper). Their press release notes:

In the Overview section, entitled “Getting Down to Business,” the Chamber notes that the new administration is starting its term amid high hopes and expectations, but that it now faces the difficult task of producing concrete results. Part of that task will be to restore an atmosphere of greater social harmony after a long period of emotionally charged political strife, the Chamber said. Simply diminishing the harsh rhetoric and divisiveness that characterized the Taiwan political arena for too long will help revive business’s willingness to invest and consumers’ willingness to spend.

The Kuomintang’s substantial election victories this year should end the painful policy gridlock that Taiwan was often subjected to in recent years, said AmCham, but with that electoral success comes immense responsibility. The KMT must also guard carefully against a return to “black gold” and other forms of corruption, especially when the opposition has been weakened and the pro-blue media may be less of a watchdog than before.

AmCham reiterated its long-held position in favor of eased economic interflows across the Taiwan Strait, with particular reference to expanded non-stop charter flights. If air travel between Taiwan and mainland cities becomes time-saving and convenient, more multinational – and Taiwanese – companies will choose to locate more key personnel and business units in Taiwan for reasons of quality of life, IPR protection, and other rule of law issues, it said. The Chamber called on Beijing to appreciate the special opportunity created by the current political environment in Taiwan, and therefore to respond positively to the Ma administration’s initiatives. In addition, it asked the Taiwan government to take action on measures that it could implement unilaterally, such as removing caps on direct Taiwanese investment in China and on mutual fund investments with China holdings, and eliminating “frivolous” items such as potato chips from the list of products banned from being imported from China.

The White Paper also stressed the need for further deregulation to address such problems in the regulatory environment as inconsistent interpretations, inadequate transparency and due process, and departures from international best practices. It praised recent improvements, including eased entry and work-permit rules for foreign professionals and the drafting of a Financial Services Act. But it noted the need for a reorganized National Communications Commission to grapple with crucial policy matters, and for the National Health Insurance system to ensure both financial solvency and optimal patient care. It also pointed to the importance of ensuring that foreign companies can compete fairly for contracts in the planned new i-Taiwan infrastructure projects, so that Taiwan has benefit of the high-quality infrastructure they can build.

The paper also directs suggestions at the US, including calling for US support for Taiwan's WHA bid:

• Assist Taiwan in mitigating the consequences of international isolation, for example by helping it attain observer status in the World Health Assembly.
• Remove Taiwan from the Special 301 Watch List regarding IPR violations.
• Pursue trade policies that promote economic liberalization, such as restoring the president’s “fast-track” authority and exploring the negotiation of bilateral agreements with Taiwan.
• End tax-policy discrimination against U.S. citizens overseas.

The Chamber's appeals to the people of Taiwan are interesting. Each year it asks for stepped-up enforcement of fake agrochemicals and for Taiwan to clean up its water, something the island could easily afford to do. But in addition to the usual appeals for direct flights and for more government enforcement of intellectual property rights, AmCham also calls for more legislative transparency and greater multiparty democracy, saying that Taiwan's polarized political environment gives businesses a lack of confidence in the island. Laudable comments -- if only AmCham had made them louder in the most recent election, instead of openly siding with the KMT in so many policy areas.

[Taiwan]