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Let business be business: No honey for the double-dealers

Reality Check


Editor's note: Starting January 1, 12 items of chemical products from Taiwan no longer enjoys preferential tax rates stipulated in ECFA. What's driving the Chinese mainland's decision? What message does it send? Take a look at this episode of Reality Check.

On January 1, the Chinese mainland suspended tariff reductions on 12 items of chemical products from Taiwan. They will no longer enjoy the preferential tax rates stipulated in the Economic Cooperation Framework Agreement (ECFA). The Taiwan Affairs Office of the State Council said in a statement that Taiwan’s trade restrictions have damaged the interests of mainland industries and enterprises and have breached ECFA.

Since it was signed in 2010, trade between the mainland and Taiwan grew from less than $150 billion to close to $320 billion in 2022. The island is running a $156.5 billion trade surplus with the mainland. In terms of trade in goods, by June, 2023, ECFA has saved Taiwan $8.8 billion taxes in trade.

Yet, before the mainland suspended tariff reductions for 12 items, Taiwan has already banned the imports of 2,509 items from the Chinese mainland.

Cheng Li-wun, a KMT legislator, said in a program that "to put it bluntly, the Chinese mainland has been giving profits to Taiwan through the ECFA. The mainland helps Taiwan get more profits, yet still gets blamed by Taiwan authority and characterized by it as offering "sugar-coated poison," while taking the "poison" so happily every day! But meanwhile, it continues to vilify the mainland and exacerbate cross-Straits antagonism as if there's going to be a war at any time. The mainland is now saying, let business be business, and Taiwan needs to pay tax and tariff in accordance with the international trading rules."

There was a time when the current leader of Taiwan had a "business" attitude towards ECFA.

When she was a candidate in the race for leadership in 2011, Tsai Ing-wen said that "trade with the mainland has to be consistent with the WTO rules. We don't want to make exceptions in order to get privileges from the mainland." It was less than a year after ECFA was signed. She was very clear in her opposition to it that she wanted a referendum to abolish it should she take power.

But, after taking power, she and her party has embraced it more than anyone. Over her tenure, Taiwan's economy has become unprecedentedly dependent on trading with the mainland. At the height of it, nearly 44 percent of Taiwan's total export was to the mainland (including Hong Kong). What have Tsai Ing-wen and the DPP done with all the benefits?

Let business be business then. Over her tenure, Tsai Ing-wen spared no effort in undermining the cross-Straits relation and the one-China principle. Her deputy Lai Ching-te, a candidate in the upcoming leadership election, has made it clear that he refuses to accept the "1992 Consensus" on numerous occasions. These people need to realize that they cannot be allowed to enjoy the benefits that the mainland offers and use the resources gained to push for a pro-independence agenda.

Trade with the mainland is a lifeline for Taiwan's economy. Those in power are responsible for the welfare of the young people and future generations. They need to recognize one simple fact: There is only one China and Taiwan is part of China.

(If you want to contribute and have specific expertise, please contact us at opinions@cgtn.com. Follow @thouse_opinions on Twitter to discover the latest commentaries in the CGTN Opinion Section.)

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