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Document selected : O-000197/2011

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O-000197/2011 (B7-0438/2011)

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PV 26/09/2011 - 18
CRE 26/09/2011 - 18

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Debates
Monday, 26 September 2011 - Strasbourg OJ edition

18. EU-Taiwan trade (debate)
Video of the speeches
PV
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  President. − The next item is the debate on the oral question to the Commission on EU-Taiwan trade by Daniel Caspary, Laima Liucija Andrikienė, Paweł Zalewski, Gabriele Albertini, Joachim Zeller, Ioannis Kasoulides, on behalf of the Group of the European People’s Party (Christian Democrats), Metin Kazak, Kristiina Ojuland, Marielle De Sarnez, Niccolò Rinaldi, Silvana Koch-Mehrin, Alexandra Thein, Marietje Schaake, Ramon Tremosa i Balcells, Sir Graham Watson, on behalf of the Group of the Alliance of Liberals and Democrats for Europe, Robert Sturdy, on behalf of the European Conservatives and Reformists (O-000197/2011 – B7-0438/2011)).

 
  
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  Laima Liucija Andrikienė, author. − Mr President, I would like to congratulate Parliament and all my colleagues for starting a parliamentary discussion on deeper trade ties between the EU and Taiwan, including the possibility of a bilateral free trade agreement in the near future.

Taiwan is an important trade partner, but our trade relationship has recently performed well below its potential. Large gains for European companies can be expected in terms of exports of goods and services, as well as foreign direct investments. Taiwan also plays a very important role in the global supply chains of information and communication technologies. The European ICT sector is itself heavily dependent on the Taiwanese supply of high-end components and contract manufacturing.

At the same time, the Taiwanese export structure does not threaten some of Europe’s most sensitive exports, such as automobiles and agriculture. What is more, the EU can also gain from a triangular trade, including Taiwan and China, since European firms, especially in the ICT sector, have already expressed their interest in using Taiwan as a high-value hub in greater China and the wider East Asian supply chains.

I would like to dwell on aspects related to Taiwan’s political status. You may know that Taiwan has the status of an independent customs territory. It has been a full member of the WTO since 2002 as well as a full member of APEC and the Asian Development Bank. Therefore closer economic ties do not contradict the EU’s ‘One China’ policy. At the same time, we must recognise that Taiwan is already negotiating an FTA with Singapore. New Zealand, India, Indonesia and the Philippines will be next. The EU should therefore be in line with these processes and consider launching FTA negotiations with Taiwan.

 
  
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  Metin Kazak, author. – (FR) Mr President, Commissioner, ladies and gentlemen, as one of the authors of this oral question, I also strongly believe that this is the ideal time to assess our economic and trade relations with Taiwan.

Taiwan is the world number one in the high tech industry; it is the EU’s fourteenth biggest trade partner, and has seen growth of 10.8% following its economic recovery in 2010. In Taipei, 30% of the population hold a university degree, and inflation in the country is low, with a rate of 1% in 2010.

The EU is the island’s largest investor, with investments worth USD 1.2 billion in 2010. As Ms Andrikienė just pointed out, the Economic Cooperation Framework Agreement with mainland China, and the beginning of negotiations for cooperation agreements with other Asia-Pacific countries, are both aimed at bringing Taipei in on the Association of Southeast Asian Nations (ASEAN) process in Asia, but also at promoting its international integration in terms of trade. These are positive signs for the EU, and a ‘second generation’ agreement with Taiwan will in future establish links with cross-strait supply chains and give European businesses greater access to the Asia-Pacific markets.

The EU’s trade strategy consists in engaging more with high-growth economies. I think that an agreement of this nature could therefore contribute to improving access to new markets for European businesses. We should not forget that, as an economic and trading entity, Taiwan belongs to 31 international organisations, including the World Trade Organisation (WTO), the Asia Development Bank and Asia-Pacific Economic Cooperation (APEC). We should also bear in mind that we have had a visa exemption policy for Taiwanese nationals in place since January 2011.

The One China policy is one thing, but the EU needs further creative solutions in order to strengthen its trade partnership, for the benefit of its citizens and businesses.

 
  
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  Charles Tannock, author. − Mr President, as chairman of the EP-Taiwan Friendship Group in this Parliament, I strongly believe that the EU should pursue a free-trade type agreement with Taiwan, which will probably be called something like ‘trade enhancement measures’. Such an agreement is in the long-term interests of both sides, and the cake grows bigger for both as synergies and opportunities for joint ventures and free flow of investments can carry on in both directions. I recently had the pleasure of trying some of their excellent single malt whisky, so Scotland beware! Competition is on its way!

Taiwan is a democracy with a vibrant free market and a largely export-driven economy. Therefore I urge the Commission not to place Taiwan in some sort of queue for negotiating an agreement. Already we know how successful the visa-free agreement has been – it should have been in place for some months now. If other countries already discussing a free-trade deal with the EU are falling behind, Taiwan should not be penalised as a result. As and when Taiwan is ready to negotiate, the EU should respond positively and judge this country solely on its economic merits, without taking into consideration what is going on in other ASEAN countries or any possible political objections from China.

The economic imperative is strong, but so too is the political imperative. Although Taiwan has made great progress in recent years towards stronger economic ties with the mainland by negotiating a successful, albeit controversial, Economic Cooperation Framework Agreement (ECFA) with the PRC, Taiwan does not want to become over-dependent on one economic partner. The EU can therefore help to ensure Taiwan’s long-term economic prosperity by helping Taiwan to diversify its global economic perspectives.

I would specifically like to ask the Commissioner: What timetable does the Commission foresee for negotiations with Taiwan? Given the unusual status of Taiwan in terms of EU legal recognition, under what legal basis and what country name will the negotiations take place? And which sectors in Taiwan and the European Union will, in the opinion of the Commission, benefit most from a possible FTA?

 
  
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  Dacian Cioloş, Member of the Commission.(FR) Mr President, allow me to present the Commission’s reply to this question on behalf of my colleague, Commissioner Karel De Gucht.

I should first like to thank Parliament for having asked this question, as it gives us the opportunity to address the subject of our trade relations with Taiwan. To place these relations in context, it is worth mentioning that Taiwan is our fifteenth largest trade partner, with a trade balance in its favour, whilst the European Union is Taiwan’s main foreign investor. We certainly want to strengthen and develop this relationship. As you know, the Commission Communication of 10 November 2010 on Trade, Growth and World Affairs, which sets out the Commission’s vision for the future of our trade policy, stresses the need to strengthen our relationships, primarily with strategic partners such as the United States, Russia and Japan, and others in the same category.

The communication also recognises the importance of the emerging economies, especially those in Asia. It does not mention Taiwan as a specific priority, but the communication in itself already provides a useful framework for relations with these economies. Although we do not have a formal agreement with Taiwan, we have a trade dialogue that works well and also provides a basis for addressing the future of our relationship.

As regards Taiwan’s trade relations with the rest of the world in general, the most recent event is the negotiation of a framework economic cooperation agreement with China, which we view as a major step forward. Indeed, good relations between China and Taiwan are crucial both from a practical point of view and from the point of view of our One China policy.

This agreement is not a free trade agreement as such, but a framework agreement that will be added to in certain areas. I think it is still too soon to know what opportunities this framework agreement will generate for European industry, but we should bear in mind that the furthering of trade ties between Taiwan and China will create new opportunities for our businesses in the region, and not act as an obstacle. In any case, we are following this development very closely.

As regards a free trade agreement between the EU and Taiwan, it is important to take Taiwan’s unique situation into consideration, especially in terms of its relationship with China. One of the arguments that Taiwan puts forward is that an agreement of this kind would create new opportunities for European businesses, not only in Taiwan but in mainland China also. The sizeable volume of Taiwan’s investments in China illustrates the extent of its relationship with China, whilst the European Union is also one of China’s major investors.

We should therefore view the strengthening of ties between Taiwan and China as a positive factor in the wider context of our economic links with the region as a whole, including China. From this point of view, it is important to avoid a false start that might jeopardise the development of good relations between China and Taiwan, or that might threaten our own relations with China and Taiwan.

At this stage, the Commission feels it is not appropriate to begin a negotiation process for a free trade agreement with Taiwan, for the reasons I have just mentioned. As for other negotiations, there are certainly other areas that we could look into, to see if they might constitute building blocks for developing and strengthening our relations. The process to analyse these areas is currently under way. We will be having consultations in Taipei on 25 October, on which we are ready to feed back to the Committee on International Trade. We will look into what action is needed in order to follow up on whatever information we obtain during these talks.

 
  
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  Daniel Caspary, on behalf of the PPE Group.(DE) Mr President, today is the first time for many years that we are discussing trade relations between Europe and Taiwan in the European Parliament. At least, I cannot remember having had such a debate since I was elected in 2004. That demonstrates how important it is, in view of the considerable importance of Taiwan for trade relations and for the economy in Europe, that we finally debate this matter here.

The core issue is: what can the European Union do in order to improve trade relations and to enhance a mutual investment climate? We have put specific questions to the Commission. I certainly understand that Commissioner Cioloş cannot go into all of the questions in detail, but he did at least read out Mr De Gucht’s script. I have to say that I am rather disappointed. We are asking specific questions, and for one specific question we have received a specific response, namely to the question regarding a free trade agreement – not in the foreseeable future. However, to the other questions we have received the reply: the weather is nice here in Strasbourg and maybe in Brussels, too, and certainly in Taiwan – but I have not heard any real concept for how the trade relations between the European Union and Taiwan can be improved.

I would be very grateful if the Commission could tell us more about this, as our group held a hearing on precisely this subject a few weeks ago and I got the impression that there are indeed ways to go about improving economic relations and the investment climate, even without a free trade agreement. I would be very grateful if the Commission would address some of the suggestions made there.

At this point, I would therefore like to offer my sincere thanks to Mr Andrikienė, Mr Šťastný and Mr Kazak, who were involved in initiating this hearing and who took part in it. I would really be very grateful if the Commission would not bury the subject of trade relations with Taiwan somewhere in a drawer, but instead if we could hear of a few more initiatives in this area in the next few years.

 
  
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  Gianluca Susta, on behalf of the S&D Group.(IT) Mr President, ladies and gentlemen, no one can deny the importance of closer trade relations between the European Union and Taiwan. Yet, surely they must be aware of the well-known and delicate question, which the Commissioner also mentioned, of institutional relations between the countries officially known as the Republic of China and the People’s Republic of China, with whom the European Union and all the Member States maintain steady diplomatic relations.

Furthermore there is no doubt that the Economic Cooperation Framework Agreement signed in 2010 between Taiwan and the People’s Republic of China will help to overcome the consequences of the territorial and political separation of ‘One China’ and will facilitate better trade discipline between the European Union and Taiwan.

Trade relations between us and the fourteenth largest global trade partner, the European Union’s seventh largest trade partner, can only improve, even though they require new regulations to eliminate the current barriers, in particular non-tariff and linguistic barriers, of a market that is still locked in the multilateral framework of the World Trade Organisation, which Taiwan has been a member of since 2002.

As I have already mentioned, however, the principle difficulties concern relations with the People’s Republic of China. While we must address the issue of maintaining a dialogue with all parties, yet politically recognise a ‘One China’, we must ensure that the two Chinas do not turn the current triangular trade into veritable triangulation which could put the European Union at a trade disadvantage, as has already happened with other East Asian trade partners such as Korea.

 
  
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  Niccolò Rinaldi, on behalf of the ALDE Group.(IT) Mr President, ladies and gentlemen, I agree to a large extent with my fellow Members from the Group of the European People’s Party (Christian Democrats). There is a degree of hypocrisy and also one of hesitation in what the Commissioner told us.

In the 2010 communication, a paradox emerged in that the word Taiwan can neither be written nor spoken. Yet, it is a small China; very democratic and extremely vital both from a trade point of view and in terms of technological innovation. There is a very real principle which we must adhere to, especially in our trade undertakings. Taiwan exists and it exists de facto as a Sovereign State; Taiwan is a full member of the World Trade Organisation; we have excellent trade links with Taiwan and it is negotiating or will negotiate free trade agreements with several third countries.

Something else is also true, which is that China, the People’s Republic of China, always responds with much irritation to our contact with Taiwan, nevertheless we do get the impression that it would be able to adapt with a certain level of pragmatism to a next step. Therefore we return to the original question, which we have still not had a compelling response to: is a free trade agreement possible with Taiwan, even at a lower or sectoral level? I think that this Parliament would be ready to support the Commission in such an undertaking.

 
  
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  William (The Earl of) Dartmouth, on behalf of the EFD Group. – Mr President, I should first make it crystal clear that the United Kingdom would be much better off if we, as a nation state, were able to negotiate our own trade agreements and thereby have trade arrangements in place that can conform, first and foremost, to the needs of our country.

On Taiwan, UK representatives should do what we can to make certain that any proposed trade agreements with Taiwan – which is a democracy and a vibrant one –are not handicapped and hobbled by an extraneous political agenda placed on them by the Commission or, for that matter, by Parliament. We from Britain of course want to retain friendship with China – indeed Britain recognised China as far back as 1949 – but we should not, and must not, neglect future trade agreements with Taiwan.

 
  
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  Philip Claeys (NI).(NL) Mr President, it is stating the obvious to say that the potential of the trade relations between the European Union and Taiwan is underexploited. The Taiwanese economy is continuing to do amazingly well and has been able to cope with the financial crisis well.

I am, of course, also disappointed by the Commission’s particularly vague statement in this House. If we wish to hold a debate about our trade relations with Taiwan, with the aim of reinforcing those relations, then it is necessary to first define and strengthen our political relations with Taiwan. We must recognise Taiwan as a sovereign state, as a democratic country that has not always had things easy in trying to keep that democracy in tact under the threat posed by the Communist Chinese mainland.

It is thus very important that the European Union should make it clear that the threats relating to the commencement of diplomatic relations with Taiwan are unacceptable and anachronistic. As a first step, the European Union and the Member States must support Taiwan in its application for membership of all kinds of international organisations – I am thinking, first of all, of its membership of the World Health Organisation.

 
  
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  Seán Kelly (PPE). - Mr President, like many speakers, I too am a little bit disappointed at the tone of the Commissioner’s response to this very important topic. Not having been here in the last parliamentary term, I am amazed at what Mr Caspary said about this being the first time we are discussing Taiwan.

When you consider that Taiwan is our fourteenth-largest trading partner and that we discuss so many topics here over the year, yet we never got around in the last seven or eight years to discuss EU and Taiwan trade, it is a welcome development that we are discussing it now.

But I think the message has to go out loud and clear that we want a little more action, a little more pluck, from the Commission than what we have seen and certainly from what we have heard this evening. I get the impression that there is reluctance, that China might not be happy with us if we are engaging too much with Taiwan.

Yes, as the Earl said, we can have a good relationship with China, we want to have a good relationship with China, but that must not in any way impede us from having a good relationship with Taiwan and developing trade links with Taiwan. We have much to gain. They have much to gain. As was pointed out, the balance favours them at the moment and certainly, by having a trade agreement with them, we can redress that balance and ensure that both economies can develop.

As I have said, I would like a little more pluck, a little more adventure and a little more courage. We have nothing to be afraid of. We have a lot to gain. So has Taiwan and probably, ultimately, China as well.

 
  
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  Crescenzio Rivellini (PPE).(IT) Mr President, ladies and gentlemen, Taiwan’s efforts to improve relations in the straits with mainland China, through a series of practical arrangements culminating in the Economic Cooperation Framework Agreement, have replaced the fear of tension and conflict with the hope for peace and understanding.

The European Union must recognise that the questions pertaining to Taiwan are also the interests of China and it must pursue a policy based on the principle of ‘one country, two systems’, as stated by US Vice-President Joe Biden on 18 August 2001 and as is usually applied to Hong Kong today. I am resolutely opposed towards any unilateral measure that changes the State of Taiwan and that could cause tensions to flair across the straits, and so I ask the Commission to respect the territorial sovereignty of China, just as I ask China and Taiwan to build mutual trust and respect for each other.

We live in a global world and the affairs of the East and the West are also our affairs, yet we must always respect the history of their peoples.

 
  
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  Agustín Díaz de Mera García Consuegra (PPE). - (ES) Mr President, the European Union is Taiwan’s fifth largest trading partner, whereas for the Union, this Asian island ranks fourteenth among its trading partners.

Trade between the two parties has increased by 800% in the last decades, with the annual trade volume currently standing at EUR 27.5 billion.

Last year alone, trade between the Union and Taiwan grew by 39%. This growth has been boosted by measures such as visa exemption, introduced via the amendment of Regulation (EC) No 539/2001. In spite of this and the fact that the Europe 2020 strategy stresses that the Union needs to step up its trade links with growing and emerging markets, our relations with Taiwan have not reached their full development as far as trade is concerned.

It is therefore necessary to bring in new measures to remove the obstacles – including tariffs, trade prohibitions, taxes and duties on luxury products – which currently prevent us from unlocking the full potential of trade with Taiwan. This would be a decisive step towards a dynamic, ambitious free trade agreement, which I support. A free trade agreement is necessary and it will benefit the parties involved. Good trade dialogue is not enough, Commissioner. We need to go much further.

Furthermore, no one has the right to veto our relations. The ties between Taiwan and the People’s Republic of China are getting stronger every day, and we, the European Union, have sovereignty to decide, without anyone’s interference, who we negotiate our free trade agreements with.

 
  
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  Andreas Mölzer (NI).(DE) Mr President, Taiwan – as we know – is clearly seeking economic agreements with the United States and the European Union in order to be able to take up a key role in the predicted and expected growth of East Asia.

In this regard, it is of course important for us to bear a few things in mind. From computers to software to solar technology, innovations in the future-oriented sectors are largely taking place in Asia. It would be a dangerous development if only marketing, distribution and logistics were to remain in Europe in the long term. Competition from the East can all too easily degenerate into an industrial war if, for example, on account of generous loans, Chinese solar technology producers can toss their products onto the market at dumping prices.

Electronics giants from Taiwan and South Korea may well quickly follow suit, and, in view of the massive distortions of competition, we will indeed have to take seriously the cry for help in this regard from European producers. Therefore, the EU will have to demonstrate a great deal of care and, no doubt, also farsightedness in respect of a trade agreement with Taiwan.

 
  
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  Eduard Kukan (PPE). - (SK) Mr President, the growth of Asian markets shows that the EU should be paying much more attention to its trade policy in this area. EU trade with Taiwan has grown more than eightfold over the past two decades, and the EU is now one of Taiwan’s largest trading partners. However, it is still far from fulfilling the potential that actually exists here.

The EU should surely devote more attention to relations with Taiwan, particularly in a situation where its relations with China have improved. The EU has opportunities to increase both investment and trade with Taiwan. This potential should be exploited and barriers to trade and investment should at the same time be gradually removed.

The EU must enter into negotiations with Taiwan over comprehensive economic cooperation as soon as possible, and begin considering a ‘second generation’ free trade agreement, similar to the one we recently signed with South Korea. I firmly believe that such an agreement would be highly useful and would bring many gains and benefits for both sides.

 
  
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  Charles Tannock, author. − Mr President, the point I want to make is that, because I was called to speak before the Commission, I was not able to react to the Commission statement.

Basically I would like to say that my group is, of course, disappointed by the announcement that there will not be any negotiations for a free trade agreement or anything like that. But if there are to be sectoral bilateral agreements, is this a way for the Commission to circumvent the rights of this Parliament to be involved with the legislative process in enacting these agreements? If there were a fourth free trade agreement, then Parliament would be involved with the assent process. If there are only individual agreements by sector, is this a way for the Commission to stitch the whole thing up without it going through a full hearing before this Parliament?

That is a question for the Commissioner to respond to.

 
  
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  President. − Mr Tannock, we will classify that as a catch-the-eye intervention.

 
  
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  Bastiaan Belder (EFD).(NL) Mr President, Taiwan is a world player – that much is beyond dispute. It is the 21st biggest economy in the world. Taipei has strong relations with China and with the United States and is an important partner for the European Union. Unfortunately – and I have also been personally able to observe this on the ground – the EU does not make the best use of the opportunities of the Taiwanese market, despite the fact that the island is the ideal springboard for European businesses looking to enter the Chinese market.

The fact is that intellectual property is much better protected in Taiwan than on the mainland. What is more, Taiwan is the European Union’s most important industrial partner. In brief, the upgrading of our relations through a free trade agreement or trade facilitation is highly desirable. I hope that the Commission also knows how to get through to the Member States in that regard.

We must not allow ourselves to guided by the fear of a possible political price that China may demand. At the end of the day, Beijing has also concluded a trade agreement with Taiwan. Mr President, sometimes I ask myself how unfettered the European Union is when it comes to Taiwan, given all this fear about China.

 
  
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  Franz Obermayr (NI).(DE) Mr President, over the last year, China and Taiwan have been drawing ever closer together, and finally there are scheduled flights between Taiwan and the mainland – unthinkable a few years ago – and tourism and student exchanges between the two are promoted. The volume of trade between the two countries is increasing rapidly, and these developments, it seems to me, are barely given any consideration by the EU. We are neglecting trade relations with Taiwan. The state is liberal in any case, the customs duty is low and there are barely any non-tariff barriers to trade.

On the other hand, we have a free trade agreement with Korea. That causes distortions of competition, because Taiwan and Korea operate in the same areas of business. It would therefore be beneficial for us to also recognise Taiwan as the important trading partner it is. Anyone who conducts trade with Taiwan need not expect or fear a boycott from Beijing. Thus, the EU needs to face up to these new developments and take the appropriate action.

 
  
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  Vytautas Landsbergis (PPE). - Mr President, we may say that Taiwan is a very peculiar and special country in South-East Asia. It has developed a European-type parliamentary democracy, a market economy and moderate social customs. Today Taiwan is peacefully building its own prosperity, being important for Europe as well, and may contribute to progress in the entire region, as well as being an encouraging example to promote democracy.

Being a crucial partner in such an international forum as a community of democracies, Taiwan does deserve, and must be supported in strengthening, its ties with the EU as well. Having its own ethnic and historical links with the Pacific, the smaller republic of today had to emerge through the controversies of the Second World War, sometimes resisting the mainland Communist dictatorship, and became a creator of its own destiny. That should undoubtedly be welcomed, and we welcome the EU-Taiwan trade agreement as well as future free-trade agreements with Taiwan. I wish you the best of luck.

 
  
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  Dacian Cioloş, Member of the Commission.(FR) Mr President, I would just like to repeat what I said at the beginning in the written answer supplied by Commissioner De Gucht, which is that a consultation is scheduled for 25 October between the Commission and the authorities in Taipei, after which the Commission intends to address the Committee on International Trade in order to feed back on the discussions. I think that will also be a good time to assess what opportunities there are.

I also want to assure you that I have taken note of the points you have raised, and of the disappointment voiced over the Commission’s reply. I will pass all this information on to Commissioner De Gucht, and we undertake to answer all these questions in writing. Once again, please excuse Commissioner De Gucht’s absence, as he was sadly unable to be here today for transport reasons.

 
  
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  President. − Thank you, Commissioner. We all recognise the difficulties of getting to Strasbourg. May I just say that I, too, am a friend of Taiwan.

The debate is closed.

Written statements (Rule 149)

 
  
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  Kristiina Ojuland (ALDE), in writing. – The one-China policy that the Commissioner was referring to is in my opinion long outdated. The Economic Cooperation Framework Agreement that has been concluded between the Republic of China and the People’s Republic of China is a clear indication of rapprochement between the two parties which should also be reflected in the relations of Taiwan with the European Union. In any case the EU should not miss out on enhancing trade relations with Taiwan, which has indeed become a rapidly growing market, but not at the expense of the environment or the socio-economic rights of the labour force. The EU ought to demonstrate readiness to engage in negotiations on furthering trade and investment with Taiwan. In order to secure the position of the EU in the international arena, its policies must be consistent and complementary. Therefore, it would only be natural to pursue mutually beneficial relations as a priority with countries that share with us a free market economy as well as the principles of democracy, rule of law and respect for human rights.

 
  
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  Peter Šťastný (PPE), in writing. – In June of this year I was one of the participants in the EU-Taiwan trade relations hearing. The conclusion at this hearing was unanimous: closer relations would clearly be beneficial to both sides. The only concern expressed by the Commission was about China’s reaction.

Without going deeper into the political debate, I must say the deeds of China speak loud. They themselves concluded the Economic Cooperation Framework Agreement with Taiwan in 2010. It is yet another sign that Communist China is moving forward step by step. They understand that engagement and not isolation is the solution.

Other countries like Singapore and New Zealand are also moving forward with much more ambitious trade relations with Taiwan and the EU should do the same.

Especially with the country that is friendly and shares our values the EU should be a leader and not a follower.

 
Last updated: 5 January 2012Legal notice