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asia policy
dependence on the mainland but would also limit Taiwan’s dependence on
the United States, integrating the island more successfully into natural trade
flows of the region. One possible diplomatic option for the United States is
to work privately toward Taiwan’s inclusion in the TPP—provided it meets
the same requirements as current members—to blunt the effect of a veto by
Beijing. This option could be pursued alongside a strategy of accelerating
China’s TPP entry and is not inconsistent with that clear U.S. policy goal.
the road forward and policy recommendations
Taiwan has an opportunity now to take the necessary steps toward TPP
membership. If it does, the island’s economy will evolve and its competitive
position in the region will be enhanced. Being a bystander at a time of
accelerating regional integration and bilateral special deals will inevitably
reduce Taiwan’s competitiveness and marginalize its role. The most significant
challenge may be the KORUS FTA. That agreement, which entered into force
on March 12, 2012, has changed regional trade and supply-chain structures
in just three years. Some of that change was well chronicled before the fact,
while other features have underperformed. 28 Nonetheless, the KORUS FTA
is the United States’ second-largest bilateral deal, and it gives South Korea
advantages in key sectors where it competes directly with Taiwan. As they
work to overcome the obstacles to TPP membership, Taiwan’s leaders should
consider the following five points:
First, Taiwan should focus its efforts on the areas of the TPP where it
can achieve successful outcomes, such as the services sector, rather than
attempting to tackle all aspects of the TPP at once, which would require
considerable political and economic capital. Taking incremental steps toward
meeting TPP standards will enable Taiwan’s leaders to build public support
for more difficult reforms in agriculture and investor-state dispute resolution.
Second, transparency and stakeholder engagement will be extremely
important in convincing the public that joining the TPP is in Taiwan’s best
interests. The American Chamber of Commerce in Taipei’s 2015 white paper
claims that “sometimes important policy changes are not communicated
to the public, leaving stakeholders in the dark.” 29 Moving forward, the
28 Brock R. Williams, Mark E. Manyin, Remy Jurenas, and Michaela D. Platzer, “The U.S.–South
Korea Free Trade Agreement (KORUS FTA): Provisions and Implementation,” Congressional
Research Service, CRS Report for Congress, RL34330, September 16, 2014 u https://fas.org/sgp/
crs/row/RL34330.pdf.
29 American Chamber of Commerce in Taipei, “2015 Taiwan White Paper.”
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