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Scholars concerned about China-South Korea FTA
Central News Agency
2014-07-04 07:23 PM
Taipei, July 4 (CNA) Scholars in Taiwan have expressed concern about a free trade agreement (FTA) between China and South Korea that is expected to be signed at the end of the year, as Taiwan's export items overlap with those of South Korea. Roy Lee, deputy executive director of the WTO and RTA Center of the Chunghua Institution for Economic Research, told CNA that after the signing of the FTA, Taiwan will be impacted within a short time. "Between 50 percent and 80 percent of Taiwan's export itemss overlap with those of South Korea," Lee said, adding that the prices, quality and destination markets of the exports are similar. He said China currently slaps an average tariff of 9.7 percent on imported items, with flat panel tariffs of 10.12 percent. He said that both Taiwan and South Korea are leading panel- exporting countries, although Taiwan is slightly ahead of South Korea in this regard. As China is also developing its own panel industry, it probably will not allow zero tariffs for South Korea, but even if China reduces tariffs in seven to 10 years, it will still restrain Taiwan's panel sector. He noted that Taiwan has enjoyed a trade surplus of between US$80 billion and US$90 billion with China over the past few years, while its trade surplus with the world has totaled US$30 billion. "If Taiwan's trade surplus with China is reduced, its trade surplus with the world will also be reduced," he said. This, coupled with high tariffs, could induce an even faster exodus of local industries, according to Lee. Gordon Sun, director of the Taiwan Institute of Economic Research's Microeconomic Forecasting Center, said that China is also the largest export destination for South Korea, accounting for 30 percent of its total exports. "If China also completes the signing of an FTA with Japan, then Taiwan will be marginalized," he said. Chinese President Xi Jinping, in a meeting with his South Korean counterpart Park Geun-hye, agreed Thursday that the FTA will be signed at the end of the year. (By Yang Shu-min and Lilian Wu)
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