On May 26, 2016, the Atlantic Council’s Brent Scowcroft Center on International Security’s Asia Security Initiative hosted a Cross-Straits Series event on the future of trade and the Trans-Pacific Partnership (TPP) in Taiwan. The discussion brings together Ms. Wendy Cutler, vice president and managing director, Asia Society Policy Institute; Ms. Tami Overby, senior vice president for Asia, US Chamber of Commerce; and Dr. Olin Wethington, nonresident senior fellow, Brent Scowcroft Center on International Security, Atlantic Council. Mr. Shawn Donnan, world trade editor at Financial Times moderated the discussion.
Dr. Wethington remarked that the future of TPP is genuinely insecure in the current domestic context. He also mentioned that, despite current challenges, Taiwan’s economy has been outperforming expectations and has become an essential part of the global supply chain, particularly in electronics and information technology (IT). In the context of institutional positioning, he pointed out that Taiwan’s participation in global and regional institutions is not aligned with its economic performance. Lastly, he mentioned that the United States has to advocate deeper institutional integration of Taiwan, which is in the interests of the United States, its allies, and the world economy. He specifically mentioned three things: 1) the United States should not just wait until TPP is in place, 2) the United States needs a more politically-committed diplomatic strategy, and 3) the United States should tell Beijing to pay attention to the mindset of the Taiwanese people.
Ms. Overby discussed the US-Taiwan trade relationship. She mentioned about significant US policy concerns, especially in agriculture. A lack of transparency in the regulatory process is also a key concern for American businesses. Taiwan also faces trade challenges, for instance, with other countries localizing their entire supply chain and Taiwan’s over-reliance on China as an export market. Recently, President Tsai placed high priority on joining TPP. Taiwan’s inclusion in TPP will increase the trade pact’s GDP by over $74 billion. To Join TPP, Taiwan needs to address standards on foreign meat imports and non-tariff barriers pertaining to Taiwan’s nontransparent regulatory approval process. Taiwan also should create a high-level TPP preparation task force within the executive branch and reform its Administrative Procedure Act to provide more time for public feedback.
Ms. Cutler emphasized that Taiwan is facing a lot of economic challenges, including a decrease of economic growth, and an increase of unemployment, particularly for youth. She outlined seven steps for countries that are interested in joining TPP: 1) Study the TPP text in detail, 2) resolve bilateral issues of concern, 3) build support in the home economy, 4) develop an effective negotiating structure for trade agreements, 5) build support for inclusion in other TPP countries, 6) consult bilaterally with other TPP countries, and 7) avoid waiting until they participate in the TPP negotiation to undertake reforms or changes in their economy. Ms. Cutler especially emphasized the final step. She mentioned that implementing some reforms right away not only helps the economy but also demonstrates their seriousness of wanting to participate in the negotiation.
A discussion with
Dr. Richard Bush
Director, Center for East Asia Policy Studies
Mr. Clyde Prestowitz
Economic Strategy Institute
The Hon. Dave Reichert (R-WA)
Representative, 8th Congressional District of Washington
US House of Representatives (TBC)
Ms. Annie Lowrey
Economic Policy Reporter
New York Times (TBC)
Please join the Brent Scowcroft Center of the Atlantic Council for a panel discussion on the continuing negotiations regarding the Trans-Pacific Partnership (TPP) and what it means for Taiwan.
The TPP is a free-trade agreement currently being negotiated between twelve countries: the United States, Canada, Mexico, Peru, Chile, New Zealand, Australia, Singapore, Malaysia, Brunei, Vietnam, and Japan. If agreed to, it would be one of the largest “free trade” agreements in US history. After WikiLeaks released the intellectual property chapter of the text on November 14, the TPP has run into serious resistance due to public scrutiny. Indeed, 151 Democrats and twenty-three Republicans in the US House of Representatives signed letters to the US’ chief negotiators expressing opposition to a “Fast Track” procedure for voting on the proposed agreement. Lost in the US domestic battle is what the TPP means for Asian allies, especially Taiwan. Taiwan is not part of the twelve-nation agreement, but it wants to be. Recently, former Taiwanese Vice President Vicent Siew said that not only should the US and Taiwan renew bilateral trade negotiations, but Taiwan should be invited to join the TPP. As Taiwan claims, joining the TPP would not only contribute to the US’ initiative to rebalance its Asia policy, but it would also be a positive extension of the Taiwan Relations Act of 1979.
To discuss the TPP and its impact on the region and Taiwan, the Atlantic Council has assembled top thinkers and policymakers on this issue. This event is part of the Asia Security Initiative’s Cross-Straits series, which examines strategic and current affairs surrounding cross-straits relations.