Former American Institute in Taiwan Director Douglas H. Paal believes the Economic Cooperation Framework Agreement (ECFA) will have a significant economic impact throughout the world. He believes it will demonstrate that closer economic ties with the People’s Republic of China are good for Taiwan and its financial future.
The ECFA is a proposed agreement between the governments of Taiwan and mainland China that would enable Taiwan to generate economic integration China. The agreement is still under negotiation and stands to be finalized sometime in June of this year.
Taiwan’s political status currently prevents it from signing free trade agreements with other countries. The ECFA would change that. However, it is not without controversy in Taiwan. Some see it as part of a larger plan to unify Taiwan with the People’s Republic of China. There is also a concern that it will allow easier access for professional Chinese workers to take desired positions in Taiwan, potentially displacing Taiwanese professionals.
Proponents see the ECFA as a landmark agreement that offers Taiwan the opportunity to increase its economic influence and cross new frontiers. Specifically, Taiwanese companies may experience new opportunities in the technology, services and manufacturing industries. The ECFA is designed to level the playing field with neighboring competitor countries. This is especially critical for Taiwan as mainland China continues to push forward as an economic superpower.