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Sunday, June 6, 2004



VIEW FROM TAIWAN

Free trade agreement
between Taiwan and U.S.
would benefit Hawaii, too


Trade is everywhere apparent in our lives, from mundane errands to the supermarket to import and export on a transnational scale. Trade has always played an important role in history as the mechanism by which supply strives to meet demand. It is even more vital and important today in this fast-paced world, as evidenced by the oft-heard phrase -- "time is money."

However, trade protection and political constraints between countries can sometimes harm trade flow. That is why the free trade agreement, a bilateral mechanism, becomes important, as it can increase access for goods and services to both signatory nations' markets with respect to manufacturing, services, investment, government procurement, telecommunications and electronic commerce, intellectual property rights and movement of people. An FTA offers significant benefits to signatory nations in terms of economic growth and employment.

An FTA between Taiwan and the United States is crucially important. The United States has been and still is one of the Pacific powers with vital interests in the economic growth, political stability and strategic balance of the region.

Since the late '80s, trade flows between the United States and the Asia-Pacific region have exceeded that of the United States and its traditional trading partners in Europe. Taiwan particularly has had a long tradition of close economic and political ties with the United States.

Geographically, Taiwan sits at the gateway to the "center of gravity" of three major regions of economic growth -- Northeast Asia, Southeast Asia and the Pacific Rim.

After years of hard work, Taiwan has succeeded in transforming itself into a knowledge-based economy by developing its research and development and high-tech industries. Taiwan has also become a role model of free enterprises, market economy and democratization in the region. It is thus a natural candidate for the United States to partner with to bridge the gap in the promotion of the U.S. economic interests, and to support its effort to further trade liberalization in the Asia-Pacific region.

A U.S.-Taiwan free trade agreement will have both strategic as well as economic benefits for the United States because Taiwan is America's eighth-largest trading partner with bilateral trade volume totaling $48.8 billion in 2002.

When it comes to the trade relations between Taiwan and Hawaii, both also share long and close relations. In 2003, Taiwan was Hawaii's 15th-highest export destination. My office has worked hard to bring Taiwan and Hawaii closer, and in return, the Hawaii Department of Business, Economic Development & Tourism opened an office in Taipei in 1994 to increase the trade volume between both sides. My government also assists the office in its effort to expand its operations.

In March, the Hawaii Taipei Office and my office successfully brought a delegation from Taitung County in Taiwan to Hawaii. Magistrate Hsu Ching-yuan of Taitung County and Ted Liu, director of DBEDT, together signed a memorandum to further strengthen the exchange in commerce, trade and technology. Lt. Gov. James "Duke" Aiona and I witnessed the signing. As another example, last July, after years of communication and planning between the state government, China Airlines and my office, China Airlines successfully reinstated its Taipei-Honolulu direct flight service which brings an additional 258 tourists per flight to this beautiful state.

The trade relations between Taiwan-U.S. and Taiwan-Hawaii are substantial. With a U.S.-Taiwan FTA, these relations can be further strengthened and will serve to fill in the gap of "open regionalism" for the United States by linking niche markets in Northeast and Southeast Asia for U.S. firms.

It is in the United States' interests to sign an FTA agreement with Taiwan so that many U.S. firms may further use Taiwan as the hub of their logistics and operations in their efforts to penetrate the markets in the region. Such an agreement will enable Taiwan to become the linchpin of the supply and demand chains for U.S. firms as they expand their market horizon in the three centers of gravity in the Asia-Pacific region.


Raymond Wang is consul general of the Taipei Economic and Cultural Office in Honolulu.

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