Starting January 1, the Chinese mainland has suspended the preferential tax rates on 12 chemical products imported from Taiwan, as outlined in the Economic Cooperation Framework Agreement (ECFA). This move comes in response to Taiwan's ban on the import of 2,509 items from the mainland.
The ECFA, signed in 2010, significantly boosted trade between the two sides, with trade volumes increasing from less than $150 billion to nearly $320 billion by 2022. Taiwan enjoyed a trade surplus of $156.5 billion with the mainland, and by mid-2023, ECFA had saved Taiwan $8.8 billion in trade taxes.
Cheng Li-wun, a KMT legislator, criticized the mainland's decision, arguing that the mainland has been providing profits to Taiwan through ECFA while facing criticism from Taiwanese authorities. He emphasized the importance of adhering to international trading rules and reducing cross-Straits antagonism.
Tsai Ing-wen, the leader of the Taiwan region, initially opposed ECFA during her 2011 leadership campaign, advocating for consistency with WTO rules and considering a referendum to abolish the agreement. However, under her administration, Taiwan has grown increasingly dependent on trade with the mainland, with nearly 44% of its exports directed there at its peak.
Tsai's deputy, Lai Ching-te, has also expressed reluctance to accept the \"1992 Consensus,\" further straining cross-Straits relations. Critics argue that the current leadership needs to recognize the significance of maintaining stable trade relations with the mainland, which remains crucial for Taiwan's economy and the welfare of its younger generations.
Reference(s):
cgtn.com
