US-Taiwan trade pact key to countering diplomatic isolation, Taipei’s top trade negotiator says

By Eric Cheung, CNN

Taipei (CNN) — The signing of a trade pact between Taiwan and the United States will play a key role in helping the island counter its diplomatic isolation from China, according to Taiwan’s top trade negotiator.

Taipei has described the initiative as the most comprehensive trade agreement between the United States and Taiwan since Washington switched diplomatic recognition to Beijing in 1979.

The agreement will allow Taipei to demonstrate its track record in following international trade rules, which will help enable future trade deals with other advanced economies, John Deng told CNN in an interview.

“Our message is that Taiwan is a reliable trading partner. We respect intellectual property rights, follow rules, and we are a transparent, democratic society,” he said.

“If we can have more international connection and attract more foreign investment, Taiwan will become stronger and also much safer.”

But the deal has also drawn ire from the Chinese government, which claims Taiwan as a part of its territory despite having never controlled it. In a statement from China’s Taiwan Affairs Office in June, Beijing criticized Washington for “giving a wrong signal to Taiwan separatist forces.”

The self-governing island has been facing hurdles in international recognition due to growing pressure from Beijing, which sees the democratic island as its own territory that must eventually be “unified.”

In recent years, China has staged massive military drills around the island, chipping away at some of its remaining diplomatic allies and blocking imports of certain Taiwanese goods.

After signing the first part of the trade pact in June, the two sides plan to begin talks on the remaining area of negotiation, including agriculture and labor, as soon as in August, Deng said, adding the goal was to complete discussion by the year end.

The deal comes amid efforts by Taiwan to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a major free trade agreement that came into force in 2018.

In March, Britain reached an agreement to join the free trade bloc, which includes 11 inaugural members: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore and Vietnam.

Pending applications

Taiwan and mainland China both submitted applications to join the organization in 2021, and their requests are still under consideration. In order to join, each member state will be required to approve the application.

Deng says the US-Taiwan trade agreement could pave the way for the island to join the CPPTT, though he also admitted that mainland China could use its economic influence to block some members from considering Taiwan’s application.

“I will say we have a good chance,” he said. “The message we pass to [these countries] is we want to follow the rule, and our track record is very clear. Please give us a chance.”

China has already signaled its opposition towards Taiwan’s application.

“There is only one China in the world … we firmly oppose the Taiwan region from entering into any agreement or organization of official nature,” foreign ministry spokeswoman Mao Ning said in March.

Deng said his team has been “working very hard” to overcome the pressure from China.

“It is the most frustrating thing shared by our society, that China is using its influence to push Taiwan outside of international organizations. We should have our voice,” he said.

“But if [global democracies] can prove to China that we can help each other, I think this sends a much stronger message to them that their behavior is not approved.”

Becoming a CPTPP member means that most exports to other members will be eligible for tariff-free trade, and it also removes barriers for businesses to provide services in other jurisdictions.

The Taiwanese government has called the pact, which covers 500 million people and is worth 15% of global gross domestic product, as “the most important” trade agreement in the region.

But Chinese pressure is not the only hurdle facing Taiwan’s trade negotiators like Deng, as trade deals could also become a politically sensitive issue on the island itself.

In 2014, a controversial service trade agreement between Taipei and Beijing — which was passed by the then ruling Kuomintang — resulted in mass student protests, known as the Sunflower Movement.

Opponents voiced concerns over Taiwan’s national security. Student protesters occupied the parliament building for weeks, ultimately leading to the suspension of the agreement.

In 2020, some lawmakers in Taiwan threw pig intestines in parliament to protest against a referendum to ease restrictions on pork imports from the United States. They opposed it because it would allow meat products containing ractopamine, an animal feed additive common in the United States. The referendum ultimately passed.

— CNN’s Will Ripley and John Mees contributed reporting.

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