Sunday, May 02, 2010

Remarks on Moving Forward with a U.S.-Taiwan Free and Fair Trade Agreement

FAPA sent this around. The US-Taiwan FTA, in various forms, has been on the back, back, back burner for quite some time. It would have been great if the US had offered Taiwan one a while back, it might be good if we got one once Ma forces the ECFA agreement on Taiwan. Perhaps the US might consider formalizing an FTA offer contingent upon ECFA. It would be a good test of Chinese intentions. On to the remarks, which are quite strong. Andrews made some good ones....


Ranking Member Ileana Ros-Lehtinen (R-FL)
Remarks on “Moving Forward with a U.S.-Taiwan Free and Fair Trade Agreement”
Rayburn HOB Room B354
Wednesday, April 28, 2010, at 12:00 noon

Members of the Formosan Association for Public Affairs, Friends of Taiwan, Supporters of Fair and Free Trade, Members of the Taiwanese American Community:

While American trade interests in Asia stagnate, the Chinese dragon is extending its claws ever further out into the Pacific.

The China-ASEAN Free Trade Agreement went into effect at the beginning of the year.

While the White House and Democratic Leadership in Congress allow the Korea-US Free Trade Agreement to languish without formal Congressional action, Beijing sings its siren song to seduce Seoul and Tokyo into joining a China-centered trade agreement.

In June, the perhaps inaccurately named Economic Cooperation Framework Agreement (ECFA) between Taiwan and Mainland China is set to be signed, despite concerns over growing Chinese economic influence on the island.

Like the Trojan horse which allowed the Greek invaders to penetrate the inner walls of Troy, the ECFA may prove to be one gift horse that the people of Taiwan would rather not look in the mouth.

The ECFA may well prove to be a political tool that masquerades as a trade instrument to achieve China's ultimate goal of absorbing Taiwan.

Strategic, political and cultural influences are all closely tied to economics.

Washington cannot cede supremacy in economic influence over the Pacific to Beijing.

A U.S.-Taiwan FTA will boost U.S. exports to Taiwan, expand the U.S. market share in Asia, and strengthen bilateral ties.

Taiwan, currently the 10th largest trading partner of the U.S. and 6th largest destination of U.S. agriculture products, is a desirable market for U.S. goods and services.

Studies by the U.S. International Trade Commission show that U.S. exports to Taiwan would grow at a rate of approximately 16% per year if a US-Taiwan FTA were enacted.

Taiwan, a democracy that supports a free market, the rule of law and human rights, provides a transparent, free and stable environment for U.S. investment and business opportunities in Asia.

It is a sad fact that most countries refrain from an FTA with Taiwan out of fear of China's reprisals.

The Taiwanese workforce and economy are increasingly left out and negatively impacted due to this isolation.

A U.S.-Taiwan FTA, however, will help Taiwan break out of its international isolation.

A U.S.-Taiwan FTA can also help halt China's growing economic and political leverage over Taiwan and give Taiwan more confidence in negotiations with China.

Now is the time for the Administration to begin moving forward in pursuing at FTA with our good friend, Taiwan.

Thank you.

Transcript of Congressman Robert Andrews' remarks (D-NJ)

April 28, 2010

Coen, thank you very much for your friendship and mentorship over the years. I so much enjoy our discussions of the issues and many wonderful people that I have had a chance to meet around our great country as a result of this association and our association.

Issues don't make sense without context. And I think the imperative for those of us who care about the great friendship between Taiwan and the United States is to educate Americans about the context of that relationship.

The greatest asset of the United States is not our mighty military although it is mighty indeed. Thank goodness.

It is not our economy. It's a bit ragged these days but it still stands as the most entrepreneurial and powerful economy in the world.

The greatest asset of the United States is our value system, and the esteem with which it is held around the world.

There is no more graphic image, no more poignant image of that point than the paper mache statue of the Statue of Liberty in Tiananmen Square twenty years ago. This is not an image that has been limited to those fighting for freedom in Asia, and the same is true in the Middle East, in Africa, in Europe and around the globe.

The context of the United States is that people around the world believe that we stand for something that is universal and desirable. The right to speak one's mind, the right to worship or not worship as one sees fit, the right to make decisions within your family, your personal affairs as you see fit, democratic rights under government, civil liberty, freedom and human rights. This is what defines us as a people. And each of those characteristics is characteristic of Taiwan.

Imperfectly in some instances, as we are imperfect but these are the core values of the people of Taiwan, and it is because the people of Taiwan hold these values that they are imperiled.

They are imperiled by an aggressive and bellicose neighbor which periodically rattles its sabers literally and figuratively towards their system; whether it's the Anti-Secession Law a few years ago or military operations a few months ago.

When the People's Republic of China rattles its sabers against Taiwan, it's not simply testing Taiwan, it's testing the United States of America! It is testing whether we truly adhere to the values we profess.

I know people in this room, including my friend and colleague from New Jersey Congressman Scott Garrett, believe strongly and passionately in the independence and the freedom of the people of Taiwan.

But even if one puts aside that very crucial value, there is another value at stake – and that is the American value and the American perception of whether we truly mean what we say and practice what we preach.

THAT is what is being tested when the rest of the world looks at the relationship between the United States and Taiwan.

I think there are three steps the United States should take to validate the point that we revere and respect human rights and freedom even when it's inconvenient, even when it's risky, even when it's not the easiest course.

And those three steps involve trade, involve our reactions to the political and economic negotiations between Taiwan and the PRC, and for the way we treat Taiwan in the global framework.

First, with respect to trade, I think for both economic and strategic reasons, the time has arrived for a Free Trade Agreement between the United States and Taiwan.

I'll be introducing a resolution in the weeks ahead that will call upon the administration to actively pursue such an agreement and present it in the U.S. Congress under the Fast Track type of rule.

The economic value is obvious. Even those of us who have frankly opposed such agreements with other countries, and I have, have opposed such agreement on grounds that we should not trade down, we should not reduce our environmental, or legal or labor standards down to another level.

That argument, which is a hotly debated argument in these halls, is relevant to the relationship between the United States and Taiwan.

Taiwan has the 20th largest economy in the world, the per capita GDP is approaching or near $30,000 per person per year, the economy of Taiwan is vibrant, modern, and advanced, and in every respect, there will be true mutual benefit for such a relationship.

But the strategic advantage is even more self-evident, in my view. It is an affirmation of an important sense that the United States regards the people of Taiwan, functionally as a free, sovereign and independent people. You don't make free trade agreements with someone else's state or territory. You make free trade agreements with sovereign people. That is a hugely important symbol – which leads to my second point.

The so–called "Economic Framework" that's being discussed between the PRC and Taiwan, in my view, is more of a "Cage" than a "Framework."

I think it reflects a negotiation from the point of a disadvantage.

Now I believe any duly elected government has the autonomy to negotiate any agreement it sees fit for its people, but that presupposes a negotiation that is free of coercion and is conducted in a truly bilateral, equivalent context. And that is most assuredly not the case.

Because, I think, of the absence of United States support for Taiwan, the PRC is really reading the situation as an invitation to engage in a more coercive discussion with Taiwan than a bilateral free one.

It would be ironic if you link these two points. If there was a so-called "Trade Agreement" signed between Taiwan and the PRC before there was a free trade agreement signed between the United States and Taiwan.

I think these issues are quite related. I think that active pursuit of a free trade agreement between the United States and Taiwan would set a better context for whatever negotiation that is going to proceed between Taiwan and the PRC. It would be an affirmation of our view that Taiwan is sovereign and independent, which leads to my final view.

Taiwan is functioning as a sovereign, independent state. There's no question about that. The rest of the world uses that way in economic terms, legal terms. And I think the time has come to end that fiction that politically and in terms of international law that that is not the case.

It is a provocative position. There is no question about that. But I think rather than simply asserting the obvious point that the World Health Organization should include the voice of the people of Taiwan, asserting the point that there should be military exchanges between the United States and Taiwan, asserting another point of this nature, I think that our policy should move in a bolder and more truthful direction of acknowledging Taiwan as sovereign and independent.

I know that is provocative. I know that's provocative. It's meant to be. Because we are confronted here with a longer struggle, between a government based in Beijing that I hope will evolve into a peaceful trading partner of the United States and a true asset to the world economy.

I hope that this is an evolution that will take place in the PRC. But for us to ASSUME that there would be an evolution would be a dramatic mistake. If the economy of the PRC grows over the next twenty years at the rate which it has grown the last twenty years; and the government of the PRC devotes to military expenditures the same share of GDP it presently devotes, the truthful share it devotes, not the share it reports, then in 20 years, the Chinese military structure will be twice the size as that of the U.S. Plane for plane, ship for ship, missile for missile.

And there will be five times as many citizens of age to bear arms in China than as there are in the United States. This is not the future that I aspire to, not the one that I predict, but it's the one that I think we have to prepare for. And I think the best preparation is not to compromise or coward on matters of principle, it is to assert matters of principle.

And the issues regarding Taiwan are matters of principle, not simply for the security and freedom of the people of that country but for the advocacy of promises made by the people of our country.

Yes, this is provocative. But I believe we should provoke a discussion, a non-violent discussion, but provoke the discussion of differences NOW, rather than wait for the day when the person with whom we are going to have this discussion is growing stronger and powerful and perhaps irreversibly bellicose in its relationship with the United States.

The great moments of our history have been the ones when we advocated with principle, even when it was risky or inconvenient. And I think this is one of those moments.

I believe in the pursuit of the free trade agreement, frankly, the creation of a new diplomatic concept for any negotiation between Taiwan and the PRC, and actions which assert our functional reality that Taiwan is a free and independent, sovereign state or the right course of Taiwan, frankly more importantly, the right course for the United States of America.

Thank you.

* * * *

QUESTION (part of it inaudible): How practical and credible is it to conclude a free trade agreement between Taiwan and the U.S. when you cannot get TIFA talks to move forward? And the free trade agreements with Columbia and South Korea have been languishing in this Congress for two years now.

Andrews: I think it is very practical and credible for these reasons. The other trade agreements that you mentioned do fall into the normal dichotomy of views on these which I am a part of, that look at the environmental standards, labor standards, and relative size of GDP. And for those of us who believe that trading down is a mistake. Those reasons are quite salient.

They are irrelevant in the case of Taiwan. For those like myself who would like an opportunity to assert my understanding of the principles of free trade and value of them, I think it is a perfect opportunity. Putting aside the strategic issue of Taiwan, for those of us who say "Yes, we should have free trade with countries that have equivalent economies, environmental and legal standards, this is the case, this is the one we ought to do. So I think it has practical values in that respect."

Question (part of it inaudible): What about the beef problems?

Andrews: I think those are "Means" problems, not "End" problems. They are important but I think they are issues of means, rather than ends.

Question: So far we haven't seen much negotiation done by the U.S. government. There seems to be reluctance from the administration to go forward.

Andrews: I think there is some reluctance on this question because they believe this is indelicate with respect to relations with the PRC. I think we should be indelicate; we should be obstreperous, or volatile in our behavior. But I think we should be indelicate. I think the policy of downgrading human rights concerns is a mistake. I don't think they should be the only object of our foreign policy but I think that, when we overlook those concerns because what we believe is economic convenience or necessity, I think, that is a mistake. The purpose of my resolution is to try to get Congress, as many Members of Congress as we can on record to assert the economic and strategic and moral value of asserting this agreement.
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Tommy said...

Let's hope for some traction for this idea. I do wonder though what he means about S. Korea being inferior to Taiwan in his argument about "trading down".

Don said...

Fascinating remarks by the good congressman and FAPA.

But I wonder if talking about future Taiwan FTAs isn't just blind optimism. So far as I can tell (from Wikipedia) a Free Trade Agreement is Treaty, and treaties are signed between sovereign states (and international organizations representing sovereign states).

Regardless of ECFA why would Beijing ever let any country (this includes the US!) sign an FTA-treaty with the ROC in the future, so long as doing so equates to adopting a two Chinas policy?

What's the alternative? Well it turns out the recent HK-New Zealand "FTA" was actually a "CEP" -- a Closer Economic Partnership agreement, with terminology defined to clarify that the HK side is the sub-sovereign entity called "Hong Kong, China" --according to this from a few days ago:

So the best Taiwan can hope for, even with an ECFA, is a future of CEP agreements as a sub-sovereign entity, approval granted case by case courtesy of those kind hearts in Beijing.

Shit. Even North Korea can do better than that.