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History in the making as Taiwan, China prepare to sign deal

International desk |
Update: 2010-06-26 12:13:33

TAIPEI, :  Every Chinese leader since Mao Zedong has seen Taiwan as the ultimate prize. Now that prize may have moved a little closer, through the medium of trade and common economic interest.

Senior envoys from Taiwan and China will sign a sweeping and eagerly awaited trade agreement on Tuesday, with hopes running high that this could mark the start of a new chapter in relations between the two sides.

"The agreement has landmark significance for both sides. It will only be a beginning, but it is far from the end," said Tang Yonghong, an economist at the Taiwan Research Institute at Xiamen University in southeast China.

At the same time, the Economic Cooperation Framework Agreement, as the pact is called, is hugely controversial in Taiwan, which has ruled itself since 1949, with thousands of opponents voicing anger at a rally in Taipei Saturday.

It is perhaps symbolic that the pact will be signed in the southwest Chinese city of Chongqing, the nation’s capital during World War II, when Nationalists and Communist were mostly united in the common battle against Japan.

After 1945, civil war between the two parties broke out again, ending four years later when the Nationalists were forced to Taiwan and the confrontation became a cold war that has lingered to this day.

For example, China has never given up the idea of taking back Taiwan by force and keeps adding new missiles aimed at the island.

But the new economic deal, which is by far the most comprehensive yet between the two and offers reduced tariffs for hundreds of key products, could do more than anything else to lower tensions.

Just as importantly, the agreement is a special case of a more universal phenomenon -- a growing sense across the world that a future without China is hardly feasible.

"Survival is more important than sovereignty. If Taiwan can`t survive economically, how can we maintain sovereignty?" said Liou Ho-tai, an expert on Taiwan’s ties with China, at Taipei’s National Chengchi University.

"If there is an economic crisis, no country will come to help us. If we can maintain economic prosperity, we can survive," he said.

Taiwan has tried for years to escape China’s immense gravitational pull, with measures such as an only half-successful drive in the 1990s to focus more on investment in Southeast Asia.

The argument has usually been that it is important to put Taiwan’s eggs in more than one basket, but it has been hard to ignore the huge basket waiting in the form of the mainland market just across the narrow Taiwan Strait.

China is Taiwan’s largest trading partner, with two-way commerce reaching 87 billion US dollars last year, and with Taiwanese investments in the mainland estimated to be in excess of 150 billion US dollars.

But economics was not the main issue for masses of people who braved heavy rains in Taiwan`s capital Saturday to protest outside the presidential office.

"You can’t trade away sovereignty," said Chen Chu, one of Taiwan`s best-known female politicians and one of a number of speakers making emotional appearances at the protest.

According to Tang, the Chinese scholar, the pact is just a "trade and economic agreement... without special political meaning" but opponents of the deal are not so sure.

If it is all about economics, they wonder why 539 Taiwanese products will benefit from the pact, while the same is true for less than half the number of Chinese products.

And they are not exactly reassured by a Chinese top negotiator who said last week that an unbalanced deal was acceptable to China because the two sides belong to "one family".

For supporters of the agreement, it is a milestone towards peace and prosperity. For its enemies, it is a millstone that threatens to pull the de facto independent island to the bottom of a hostile ocean.

BDST: 0851 HRS , June 27, 2010

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