AmCham arrow Publications arrow Topics Archive arrow Topics Archive 2003 arrow Vol.33- No.6 arrow Editorial: Two-way Commitments in the WTO
Editorial: Two-way Commitments in the WTO PDF Print E-mail

Before its accession to the World Trade Organization (WTO) last year, Taiwan went through a frustrating 12-year application process. The hold-up was basically political -- the need to wait until Beijing (which required more time to bring its trade practices in line with international standards) had also qualified to join the organization, thus saving the PRC the embarrassment of entering later than Taiwan.

But that long delay at least provided plenty of time to hash out agreement on the conditions under which China and Taiwan would participate. Due to the political pressures, Taiwan had to apply not as a sovereign state but under a special clause making full membership available to "customs territories."

 

Now, a mere year and a half later, China is attempting to change the rules, demanding that WTO downgrade the Taiwan delegation's status from that of a "permanent mission" to one of an "economic and trade office." Adopting that nomenclature, currently used for Hong Kong and Macau, which originally entered WTO as colonies and are now special administrative regions of the PRC, would imply that Taiwan's representation is subordinate to China's.  

Taiwan has rightfully refused to accept the proposed change. In the interest of fairness and to keep this vital economic organization insulated from political machinations, the WTO membership should strongly resist Beijing's attempt to move the goalposts in mid-game.

At the same time, it is incumbent on Taiwan to bolster its support within WTO and the rest of the international community by demonstrating a deep-seated commitment to both the letter and spirit of all WTO principles. During its short tenure as a WTO member, Taiwan has not stood out as an active proponent of freer trade. Instead it has frequently opted to get by with the minimum amount of change necessary to stay in compliance with the regulations.

And in at least one case -- regarding policy on the import of rice -- lack of compliance has been even more serious. Last year Taiwan acceded to the WTO on the basis of a mechanism called the Minimum Market Access quota to regulate rice imports, but was months late in putting it into effect. Then last October the Taiwan government announced its intention to switch to another approach, the Tariff Rate Quota system, but in doing so threw out many of the market access commitments it had negotiated with the United States and other trading partners. In addition, rather than increasing market access, the main purpose of Tariff Rate Quotas, Taiwan imposed 450 percent duties on rice imports beyond the quota, basing this duty on questionable price data. The result is confusion in the international market for rice, and Australia, Thailand and the United States have all raised formal objections in the WTO.  

With Beijing making life more difficult for Taiwan at every turn, Taipei needs all the friends and supporters it can find within the WTO. Creating doubts about Taiwan's dedication to the cause of free trade is not the way to accomplish that.
 
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