January 15, 2014

Be ‘hyper-aggressive’ over trade deal: US academic

Source: Taipei Times

Journalist: William Lowther

The nation should learn to be “hyper-aggressive” about trade and not be “fretting constantly” over China, a Washington conference was told on Monday.

The nation should be a “global trader” seeking partnerships with big countries like India and Brazil, said Derek Scissors, a resident academic at the American Enterprise Institute.

Addressing a Hudson Institute conference on “US-Taiwan Economic Relations,” Scissors said the now-being-negotiated Trans Pacific Partnership (TPP) could be a “wonderful way” for Taiwan to overcome its international isolation.

There was no question that the TPP offered major potential opportunities to Taiwan, but the administration of President Ma Ying-jeou (馬英九) should be doing more to win membership, he said.

He said the administration’s comments about joining the TPP in eight or 10 years sounded “silly.”

Scissors said that while the TPP had great potential benefits for the nation, it also had large economic risks.

If the TPP is launched in the near future and is a weak agreement, it could undermine US strength in Asia, leaving Taiwan with fewer options and friends who were less powerful.

Or, if the TPP evolves into a stable agreement and Taiwan is not a member, the nation will be left behind.

“It’s wonderful that Taiwan wants to join TPP, but that is not a response,” Scissors said.

He said a response would be to change policies and hold active negotiations on joining within one month of the agreement going into effect.

“Taiwan has not responded adequately to TPP,” he said.

“It should be doing all that it can to get ready to join — changes need to be made now so that Taiwan can jump to the front of the TPP line,” Scissors said.

Instead, the nation was boasting about its importance and putting on “a road show,” he said.

“I can see us standing here in 2020 still wondering about Taiwanese TPP membership, and that would be dangerous,” he said.

Scissors said it would be a sign of interest and good faith — and would speed up the process — if Taiwan moved now to liberalize its agricultural sector.

“Agriculture would be a great area for Taiwan to show how serious it is about joining TPP,” Scissors said. “The more Taiwan gets itself into position on the critical issues, the more it can stand out from the crowd and show that it can make difficult liberalizing steps.”

Patrick Cronin, senior director of the Asia-Pacific Security Program at the Center for a New American Security, said that Taiwan was being squeezed out and left with an uncertain picture of its future.

He said that economics were the underpinning of security and that Taiwan needed to protect itself militarily, buy more space for diplomacy and trade, and ensure it had diversified global relationships.

“Without a balanced economic strategy and sufficient political space, Taiwan will simply be absorbed,” Cronin said.

“It will be absorbed within the next couple of decades,” he added.

Cronin said that the TPP was going to be the decisive trading framework across the Asia-Pacific and that it was “vital” for Taiwan to join.

“This is an urgent matter for action now and not some distant point in the future,” he said. “It is really a matter of political will for Taiwan to take the steps necessary.”

He said that Taiwan should use the TPP framework negotiations — scheduled to conclude soon — to spur domestic reform and trade liberalization.

Taipei Economic and Cultural Representative Office senior executive economic officer William Liu (劉威廉) said that over the past six decades, Taiwanese had created an economic miracle from scratch.

There was a “profound friendship” between Taiwan and the US, and Taiwan treasured the relationship and wanted to develop it further, he said.

However, there were some “worrisome signs” that the two economies were becoming decoupled, Liu said.

“Taiwan’s participation in the TPP would greatly enhance US-Taiwan relations,” Liu said.

“Taiwan has made a magnificent contribution to regional security and stability. What better friend in the Asia-Pacific region does America have?” he added.


  • Patrick M. Cronin

    Former Senior Advisor and Senior Director, Asia-Pacific Security Program

    Patrick M. Cronin is a former Senior Advisor and Senior Director of the Asia-Pacific Security Program at the Center for a New American Security (CNAS). Previously, he was the ...