Taiwan asks US not to forget about potential FTA

Industry News | | MIC Customs Solutions |

Taiwan has appealed to the US government not to forget about the possibility of a free trade agreement between the two states.

Taiwan has reiterated its desire to establish a free trade agreement (FTA) with the US and asked the American government not to forget its wishes for closer commercial cooperation.

However, the Asian island also acknowledged that any potential economic partnership with the US is still a long way off, largely due to the risk of antagonizing China, which claims sovereignty over Taiwan.

John Deng, the top trade negotiator for Taiwan, is due to travel to Washington later this month for discussions with senior US officials.

He told Reuters it was important to speak about the goal of an FTA "clearly" and to inform more people that "this is Taiwan's aim".

But he also stressed that Taiwan is "very realistic", adding: "Of course, we understand you can't move now."

Mr Deng said the "building blocks" of a potential deal can be established first, before tariffs and other elements are added at a later stage.

The US and Taiwan recently launched a joint initiative to drive economic engagement, which the Biden administration said would outline an "ambitious road map" for further negotiations in various areas, including agriculture, digital trade and the environment.

However, this came after Joe Biden's unveiling of the Indo-Pacific Economic Framework (IPEF), a trade deal between the US and 12 other countries that doesn't include either China or Taiwan.

Bonnie Glaser, a regional expert at the German Marshall Fund, told the Financial Times the exclusion of Taiwan from IPEF "dealt a hard blow".

Discussing the newly announced joint initiative between the US and Taiwan, she said: "This step is welcome, but it falls short of both IPEF and a bilateral FTA. Nevertheless, if agreements are reached in all these areas, they could comprise future chapters of a bilateral trade deal if the politics become more favorable."

Taiwan is a heavily export-oriented economy, with most of its overseas trade coming in the form of electronics; information, communication and audio-video products; base metals; plastics and rubber; and machinery.

The US is its biggest trading partner outside Asia.