ECFA Helps Taiwan Integrate Into Global Economy

ECFA Will Help Taiwan Integrate Into Global Economy: WTO

The recent signing of a trade pact between Taiwan and China is expected to help Taiwan further integrate into the global economy, the World Trade Organization (WTO) said.

In an interview with the Central News Agency, WTO Director-General Pascal Lamy attached great significance to the economic cooperation framework agreement (ECFA) with China in terms of Taiwan's external trade and investment.

Furthermore, with the continued improvement of cross-strait ties, Taiwan will be able to attract more foreign investments and sharpen its competitiveness, he said.

Taiwan and China signed the ECFA on June 29, agreeing to allow 539 Taiwanese goods and services tariff free entry or easier market access to China.

According to Lamy, in an assessment prior to a trade policy review, the WTO found that the objectives of Taiwan's overall trade policy continue to be governed by its need to be integrated into the global economy through participation in multinational trade organizations and by other means, such as talks on free trade agreements (FTAs).

"Now, The ECFA is an important initiative in this endeavor and we think it could considerably improve cross-strait relations and can be very important for ensuring the competitiveness of domestic industries and further integrate Chinese Taipei into the world economy," Lamy said in the interview.

In the report complied by WTO Secretariat ahead of a review this week of Taiwan's trade policy, the organization said the ECFA is expected to help improve cross strait relations further and clear the way for Taiwan to sign FTAs with its other trading partners in the region.

Taiwan's signing of the ECFA and its pursuit of FTAs with other major trading partners is likely to give it a more competitive edge, according to the report.

Taiwan's aim with regard to global trade is to establish a "global linkage" in the world economy by first emphasizing multinational economic ties then stepping up measures to boost bilateral relations with its trading partners, the report said.

With further integration into the world economy, Taiwan will be able to attract foreign investments, boost its international visibility and eventually maintain its economic growth, the WTO report stated.

According to the report, Taiwan's inbound foreign direct investment (FDI) to GDP ratio is 2.1 percent, which is low by regional standards. It is therefore necessary for Taiwan to improve its investment environment, it added.

Lamy said further improvement of cross-strait relations could help Taiwan to raise its FDI, as many countries want to use Taiwan as an export hub to China.

ENDS

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