US and Taiwan make progress on trade
The United States and Taiwan have reached an initial agreement for a "21st century" trade pact. Here's what that means
The United States and Taiwan have reached an agreement on the first part of their "trade initiative for the twenty-first century", which is an exchange treaty judged to be more modern in content than past ones.
WHAT THE AGREEMENT CONSISTS OF
The Office of the Trade Representative, a body that advises the US president on issues related to international trade, explained that Washington and Taipei have agreed on issues such as customs procedures, regulatory practices and the treatment of small businesses. Once this initial agreement is signed, negotiations will begin on the more complicated issues: agricultural and digital trade, labor and environmental standards, the treatment of state-owned companies, the management of non-market oriented practices.
FULL DEAL BY YEAR END?
Katherine Tai, the US trade representative, said the two sides aim to "conclude a robust, high-standard trade deal that addresses the economic challenges of the 21st century." The Taiwanese counterpart, the Trade Negotiations Bureau, added that Taipei wants to conclude the negotiations by the end of 2023.
IT IS NOT A FREE TRADE AGREEMENT
The anti-corruption provisions were taken over by the USMCA, the North American Free Trade Agreement (United States, Mexico, Canada) which succeeded NAFTA.
However, the trade initiative between the United States and Taiwan is not a free trade treaty, in the sense that it will probably not change tariffs on goods. But its supporters say it will still help strengthen economic ties between the two countries, simplify trade, and improve Taiwan's ability to resist Chinese economic coercion.
WHAT CHINA HAS TO DO WITH THE US-TAIWAN PACT
Despite being in fact a separate country (even if there are few governments that formally recognize it: not even the American one does), Taiwan is considered by China as a part of its territory to be brought under its control, although it has never governed.
The Washington-Taipei pact is therefore not appreciated by Beijing, which considers it a violation of its sovereignty, especially since the announcement of the agreement was made shortly after the meeting between the US Secretary of Commerce, Gina Raimondo, and his Chinese counterpart Wang Wenta.
– Read also: Meloni and Urso want to seduce Taiwan by leaving the Silk Road?
THE INDO-PACIFIC ECONOMIC FRAMEWORK
Bilateral talks between the United States and Taiwan began last August after Joe Biden's administration excluded the island from its major trade initiative for East Asia, the Indo-Pacific Economic Framework . Even in the latter case, this is not a traditional trade agreement since it does not provide for reductions in barriers to accessing the American market, for example; it is rather a framework , i.e. a regulatory framework that sets high standards for the development of future agreements on specific sectors.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/stati-uniti-taiwan-accordo-commerciale/ on Sat, 20 May 2023 05:00:51 +0000.