Taiwan MPs set to review China trade deal in July

Taiwan's divided parliament will meet in July to review and possibly stall a China trade deal that is expected to boost the $390 billion island economy.

Taiwan MPs set to review China trade deal in July

Taiwan's divided parliament will meet in July to review and possibly stall a China trade deal that is expected to boost the $390 billion island economy but may also bring an unwelcome flood of cheaper Chinese goods.

The ruling Nationalist Party caucus said on Wednesday it would schedule a special legislative session in late July to approve, reject or change the economic cooperation framework agreement (ECFA) set to be signed a month earlier.

Taiwan's anti-China opposition Democratic Progressive Party (DPP) is sure to protest to parliament, citing over-dependence on Beijing, while the Nationalists are seen offering the DPP concessions to look good ahead of tense year-end local polls.

Negotiators from export-reliant Taiwan and economic powerhouse China, political rivals for decades, would need to rehash the pact to approve any suggested changes, setting back its implementation and perplexing markets that have firmed on hopes of a smooth passage.

"It wouldn't go too smoothly, because the DPP will hold it up," said Nationalist lawmaker Lee Hung-chun, whose party controls parliament. "We don't know how long that will take."

Strong opposition from the DPP, which fears China may use the deal to flood Taiwan with cheaper goods or assert the sovereignty it claims over the self-ruled island, would prompt concessions most likely affecting the agreement's core list of some 300 items set for tariff cuts.

Small Taiwan firms could be put out of business by any sharp influx of Chinese merchandise following import tariff reductions, opponents of the deal say.

Concessions in parliament would keep the populist DPP from using the pact as an issue in Nov. 27 city elections seen as a barometer for Taiwan's presidential race in 2012.

"It would be politically correct and politically wise to give some concessions," said Shane Lee, a political scientist at Chang Jung University in Taiwan. "If they don't, the society will never rest in complaining about ECFA."


Reuters

Last Mod: 26 Mayıs 2010, 16:34
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