Tang Yonghong: US-Taiwan FTA will do more harm than good

News portal DW News recently published an interview with Professor Tang Yonghong, deputy director of the Taiwan Research Center at Xiamen University. 

With the upcoming 10th anniversary of implementation of the cross-Straits Economic Cooperation Framework Agreement (ECFA), discussions and controversies have followed in quick succession. Although many Taiwan scholars recognize that ECFA is beneficial to Taiwan's industrial and economic development, they are still calling for Taiwan to strive to sign a free trade agreement (FTA) with the United States. Professor Tang Yonghong said that the United States has diplomatic relations with the Chinese mainland, and the US should abide by the commitments made to China when establishing diplomatic relations, but this does not rule out the possibility that the United States and Taiwan will take the risk to sign the FTA. However, this will certainly be strongly countered by Chinese mainland, and the US and Taiwan will probably pay a huge price far more than what they can get from the FTA.

Q: Although Taiwan joined the WTO in 2002, because of its "special status", many countries are reluctant to sign the FTA with Taiwan because of its "special status". Some scholars from Taiwan believe that in addition to ECFA, Taiwan should strive to promote the US-Taiwan FTA, because the United States is the only country that is likely to sign the FTA with Taiwan regardless of the view of the Chinese mainland. Is it possible for the US and Taiwan to sign the FTA?

A: The cooperation agreement at the level of public power is based on mutual recognition of public power (the establishment of diplomatic relations). Countries or regional economies that have established diplomatic relations with the Chinese mainland must recognize that the government of the People's Republic of China includes the mainland, Taiwan, and HK and Macao special administrative regions (this is the political basis and prerequisite for the establishment of diplomatic relations). Of course, Chinese mainland cannot agree with Hong Kong, Macao and Taiwan to develop partnership with other countries without China's authorization. Through the basic law, Hong Kong and Macao have been authorized by the People's Republic of China to develop foreign economic and trade relations at the level of public power.

However, Taiwan, as a separate customs territory, has not yet obtained similar authorization due to the cross-Straits relations. Taiwan's accession to the WTO as a separate customs area was indirectly agreed by the PRC through the WTO. However, this does not mean that the People's Republic of China has authorized or agreed that Taiwan's separate customs area can freely develop relations with other WTO members who have diplomatic relations with the Chinese mainland.

Currently, the US has diplomatic relations with the Chinese mainland. It should also abide by the commitments made at the time of the establishment of diplomatic relations between China and United States, and should not develop any relations at the level of public power with Taiwan. Since the establishment of diplomatic relations, the US has in fact acted in the same way. Although there are some changes in the current US policy toward China, the interests of Sino-US relations far outweigh those of establishing diplomatic relations with Taiwan. Therefore, the United States will still maintain its diplomatic relations with Chinese mainland and abide by its commitment to establish diplomatic relations.

Q: But do you foresee any unexpected situations? Although as you said, when China and the US established diplomatic relations, there was also a commitment, and the possibility of such a situation was not high. However, given the efforts made by Taiwan, and the pressure of the election and the epidemic situation in the United States, plus the factors of Trump himself, could the US and Taiwan FTA be eventually produced under the influence of various factors? If that happens, will the Chinese mainland consider severing diplomatic ties with the United States? In your opinion, what is the worst-case scenario?

A: With the economic rise of Chinese mainland and the fear of it surpassing the US, the United States has become increasingly anxious and adjusted its strategy and policy toward China in recent years, and at the same time is using various opportunities to continuously strengthen its containment of China, including playing the "Taiwan card". At the same time, the green camp represented by the DPP and its ruling authorities have been seeking and creating opportunities and conditions for the United States to support Taiwan's independence, including harming Sino-US relations. In this context, the United States and Taiwan are interconnected and making use of each other, which is more demanding and stronger than ever since the establishment of diplomatic relations between China and the US.

Therefore, the possibility that the US and Taiwan will take the risk to sign the FTA is not ruled out. However, this will certainly be strongly countered by Chinese mainland, and US and Taiwan will probably pay a huge price far more than what they can get from the US-Taiwan FTA. The cost for the United States may not be only losing the benefits of Sino-US trade agreements, and the cost for Taiwan may not be only losing the benefits of cross-Straits economic and trade activities. Due to the high cost, the possibility of the US and Taiwan to sign the FTA is very small.

Q: There have been a lot of discussions on the existence or termination of ECFA in recent days. What are your considerations in advocating that the mainland should terminate the agreement?

A: Any international economic and trade cooperation agreement is based on the necessary political consensus and the normal development of bilateral relations. The "1992 consensus" or the core meaning that both sides of the Straits belong to the same country was the political basis and prerequisite for the negotiation of public power and the signing of 23 agreements, including ECFA. Once the "1992 consensus" or the core meaning that both sides of the Straits belong to one country are not recognized by Taiwan, all these agreements, including ECFA, will of course be invalid in political and legal sense.

If Taiwan does not agree with the "1992 consensus" but engages in "Taiwan independence" separatist activities, while ECFA still continues to operate, that would not only cause "political and economic separation", but also make no one in Taiwan agree with the "1992 consensus". More people would pursue "one China, one Taiwan" and refuse the reunification, which is not conducive to opposing the "Taiwan independence" and promoting reunification.

Moreover, it would objectively lead to the DPP taking advantage of the fruits of economic development as a way to remain in power, and continue the "Taiwan independence" separatist activities, including have money to buy more weapons to resist reunification. And it is likely to pose a greater threat to the safety of life and property of people in Chinese mainland.