ECFA Agreement reached

Welcome counterfeiters and smugglers! ECFA is in the house! Media organs began reporting last night that negotiators for the CCP and the KMT had reached agreement on 200 items from China to Taiwan, and 500 from Taiwan to China. Bloomberg reports:

China and Taiwan said they reached a basic agreement on tariff reductions in a third round of talks to boost economic and trade relations.

“We are still working on details, but the basic agreement has been reached,” Tang Wei, head of Taiwan, Hong Kong and Macau affairs at China’s Ministry of Commerce, said late yesterday after talks in Beijing with Huang Chih-peng, director- general of Taiwan’s Bureau of Foreign Trade.

An agreement would lower tariffs on more than 200 items exported from China to Taiwan including car parts, petrochemicals and machinery, the officials said. The exact items have yet to be decided, and Tang said he hoped that Taiwan would export textiles and car parts to China. An accord would allow service providers to compete in the two markets, he said.

The report is entirely one-sided, but it does note that:

Any accord “will boost market sentiment and confidence,” Tony Phoo, an economist at Standard Chartered Plc, said by phone in Taipei yesterday. Still, “the preferred-tariff treatment won’t happen at least for the next one to two years.”

One to two years? Just like the financial agreements, the effects are in the future.

Kyodo, and this report above, also hint that the agreement is about having an agreement -- yesterday Kyodo said that negotiations remain to "confirm" the list. As AFP reports, negotiations had stalled. Further, the "early harvest" list had been dropped entirely. It looks like they agreed to simply announce an agreement, so the KMT wouldn't lose face, and then hammer out the details over time. Taiwan News reported:

The administration of President Ma Ying-jeou wants to sign the accord before the end of June, but Premier Wu Den-yih for the first time threw doubt on that timetable Saturday when he said the negotiations were stuck in differences over the early harvest list.

Taiwan’s chief negotiator, Huang Chih-peng, said at the start of the talks Sunday that both sides had largely agreed on the text of the ECFA and on the basic principles for the early harvest list. Taiwan and China had also largely agreed on other items such as measures to solve trade disputes, he said.

Huang is the director-general of the Bureau of Foreign Trade under the Ministry of Economic Affairs. His counterpart at Sunday’s talks was Tang Wei, the head of Hong Kong, Macao and Taiwanese affairs at China’s Commerce Ministry.

During the morning, negotiators discussed the wording of the accord itself, according to statements made to the media during the lunch break.

KMT officials had flown over to make one last desperate bid this weekend for an agreement after the early harvest negotiations collapsed. Looks like they succeeded in reviving an agreement. Or at least the appearance of one.

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