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China trade reliance too high: chamber

Taiwan should strive to reduce its trade dependency on China and instead seek to expand in central and eastern Europe, General Chamber of Commerce chairman Paul Hsu said on Sunday in response to President Tsai Ing-wen’s Double Ten National Day address.

Hsu said he focused on the part of Tsai’s speech where she said: “Our position on cross-strait relations remains the same: Neither our goodwill nor our commitments will change. We call for maintaining the status quo, and we will do our utmost to prevent the status quo from being unilaterally altered.”

Hsu said that while everyone wants peace, “China’s understanding of Taiwan’s ‘status quo’ may not be the same as that of Taiwan.”

He said that the different perspectives help explain China’s constant incursions into Taiwan’s air defense identification zone.

He said that in terms of cross-strait economics and trade, more than 40 percent of Taiwan’s exports go to China.

Should Taiwan lose China as a trade partner, the damage would be disproportionately bad for Taiwan, and it is therefore in the national interest to reduce exports to China to about 20 percent, he said.

Hsu mentioned China’s Belt and Road Initiative as an example of how Taiwan could establish better relationships with other countries and draw in prospective trade partners, so as not to “put all our eggs in one basket.”

Regarding the government’s widely promoted New Southbound Policy, Hsu said the program has shown less potential than expected at diminishing China’s economic power over Taiwan.

Hsu said that China’s influence on Southeast Asian nations likely exceeds the goodwill gestures of Taiwan.

Hsu said the nation should expand its horizons to new markets in central and eastern Europe, to countries such as the Czech Republic and Lithuania, which recently donated COVID-19 vaccines to Taiwan.

Chinese National Federation of Industries secretary-general Tsai Lien-sheng said that in light of a US-China trade dispute, Taiwan is seeing more foreign residents invest in their home countries.

However, Taiwan could use more investment to resolve its shortage of water, energy and land, as well as ensure that the workforce has the requisite skills, he said.

Although economic growth this year is expected to be about 5 to 6 percent, CNFI data show that profits are generally going to either large conglomerates or companies in the semiconductor industry.

Small and medium-sized enterprises, which comprise the majority of Taiwan’s businesses, are still suffering because of the COVID-19 pandemic, Tsai said.

The government should utilize Taiwan’s application to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership to help local businesses transition and better adapt to the global market, he said.
Source: Taipei Times

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