Taiwan to urge Korea to explore FTA

By Kim Young-jin

Taiwan is urging Korea to explore the feasibility of a bilateral free trade agreement (FTA) — despite their lack of official diplomatic ties — under a “pragmatic” approach to regional relations, the Taiwanese representative in Korea said on Nov. 2.

Such a pact would most certainly face an uphill battle, however, as Seoul maintains diplomatic ties with Beijing, not Taipei, under its “One China” policy.

Still, Liang Ying-ping, Taiwan’s representative in Korea, said one of his main tasks is to urge Korea to look into the prospects of an FTA.

“Korea is positioning itself as a hub of an FTA network in the Asia-Pacific region and I hope Taiwan can make some contribution to such a network,” he told The Korea Times at his office in downtown Seoul.

Liang, who began his term in September, said the two sides are “exchanging concepts” and that Taiwan, the 18th largest trader worldwide, has done its best to get its message across to the Korean government.

Such a deal faces the tall hurdle of Taipei’s political circumstance.

China has claimed sovereignty over Taiwan since 1949, when nationalists led by Chiang Kai-shek took to the island after Mao Zedong’s communists won the Chinese civil war. The situation forces countries to choose with which side it will maintain relations.

Seoul severed ties with Taiwan in order to establish official relations with Beijing in 1992, after having maintained relations with Taipei since 1949.

Still, the countries have a robust economic interaction, with Korea standing as Taiwan’s fifth largest trading partner in 2009 and Taipei

Seoul’s ninth largest, according to Liang’s office in Korea.

It added that bilateral trade reached $17.8 billion in 2009 despite the financial crisis, and that the amount climbed to $19.3 billion between January and September this year.

“I think our relations are on the right track,” he said. “In order to help both sides to carve out more niche markets overseas, including in mainland China, we would like to urge Korea to set up a study group on the possibility of an FTA,” Liang said.

In such a case, Taiwan would establish a corresponding group so the sides could compare notes, he said.

Taiwan currently has FTAs in place with Panama, El Salvador, Honduras, Guatemala and Nicaragua — all countries it maintains diplomatic relations with. It has also launched a feasibility study group with Singapore, with which it does not, he said.

Liang’s call comes on the heels of the implementation of the China-Taiwan Economic Cooperation Framework Agreement (ECFA), which eliminate tariffs on 539 Taiwanese goods worth $13.83 billion — a precursor to full-fledged FTA in the future.

The pact set off alarms in Korean and Japanese business circles, as a considerable share of their exports to Chinese markets overlap with those of Taiwan, one the largest suppliers of computer chips, notebook computer and LCD panels.

As a result, many here urged Seoul to step up its efforts to sign its own accord with Beijing.

The two sides concluded a nearly-four-year feasibility study in May, but it has not lead to the immediate launch of official negotiations.

‘Modus Vivendi’

Taipei’s rapprochement with Beijing and its FTA overtures to Korea come courtesy of a new approach to foreign policy implemented by President Ma Ying-jeou, who took office in 2008, Liang said.

Dubbed “Modus Vivendi,” which in Latin refers to a temporary agreement pending a final settlement, Taiwanese foreign policy under Ma has sought friendly ties with Japan and a pro-United States policy, according to the representative.

“Our policy is to handle economic issues before political, urgent matters rather than general, easy matters rather than difficult,” Liang said.

Of course, it is the improved ties with China that have taken the lion’s share of the attention.

The ECFA included clauses that restricted the importation of Chinese agricultural goods to Taiwan, a major boon to Taiwan’s agricultural sector seen as a major sign of goodwill between the states.

“Through this process we can build up mutual trust. If we have full-fledged confidence between China and Taiwan, between the two governments, it will be easy for us to manage to solve political issues ahead,” he said.

In May last year, Taiwan attended a World Health Assembly meeting as an observer, marking the first time it has participated in meeting hosted by a UN agency in 38 years.

In another diplomatic gain, a committee of the European Parliament passed a resolution last month to allow Taiwanese nationals visa-

free entry into EU countries.

Liang said Modus Vivendi likely precludes any switching of diplomatic recognition from Taiwan to China in the foreseeable future “because there is goodwill shown by both sides in the international arena.”

In 2007, Costa Rica sacrificed its ties to Taiwan in order to establish relations with Beijing.

As for Korea, the representative suggested that relations should be “enhanced on all levels.”

He suggested that the sides look into opening up a direct air link from Gimpo International Airport west of Seoul to Taipei’s Songshan airport. Such a move would create a city-to-city network in Asia, as Songshan recently opened direct flights to both Tokyo and Beijing.

Liang acknowledged the major hurdle of the Seoul’s “One China” policy. Still, he remained optimistic about addressing the challenge through increased communication.

“During my stint I would like to promote ‘functional cooperation’ between our countries,” he said. “Any undertakings between us should be beneficial to both sides. If we use our imagination and wisdom, I think our communications can be enhanced in the future.”