The Economic Cooperation Framework Agreement (ECFA) is a
free trade agreement
A free-trade agreement (FTA) or treaty is an agreement according to international law to form a free-trade area between the cooperating states. There are two types of trade agreements: bilateral and multilateral. Bilateral trade agreements occur ...
(FTA) between the governments of the
People's Republic of China
China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and ...
(
mainland China
"Mainland China" is a geopolitical term defined as the territory governed by the People's Republic of China (including islands like Hainan or Chongming), excluding dependent territories of the PRC, and other territories within Greater China. ...
, PRC, commonly "
China
China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and ...
") and the
Republic of China
Taiwan, officially the Republic of China (ROC), is a country in East Asia, at the junction of the East and South China Seas in the northwestern Pacific Ocean, with the People's Republic of China (PRC) to the northwest, Japan to the northeast ...
(ROC, commonly "
Taiwan
Taiwan, officially the Republic of China (ROC), is a country in East Asia, at the junction of the East and South China Seas in the northwestern Pacific Ocean, with the People's Republic of China (PRC) to the northwest, Japan to the nort ...
"), that aims to reduce tariffs and commercial barriers between the two sides, as well as improve cross-strait relations.
The pact was signed on June 29, 2010, in
Chongqing
Chongqing ( or ; ; Sichuanese dialects, Sichuanese pronunciation: , Standard Mandarin pronunciation: ), Postal Romanization, alternately romanized as Chungking (), is a Direct-administered municipalities of China, municipality in Southwes ...
, and was seen as the most significant agreement since the two sides split after the
Chinese Civil War
The Chinese Civil War was fought between the Kuomintang-led government of the Republic of China and forces of the Chinese Communist Party, continuing intermittently since 1 August 1927 until 7 December 1949 with a Communist victory on m ...
in 1949, since neither government recognize the other as being the sole government of China.
It was expected to boost the then current US$197.28 billion bilateral trade between both sides.
Background
The government of the People's Republic of China uses its influence on
neighboring economic powers to prevent them from signing free-trade agreements (FTAs) with the Republic of China ("Taiwan") which
China claims that the ROC has been eliminated and so Taiwan is part of its territory. Instead, under the leadership of the
Kuomintang
The Kuomintang (KMT), also referred to as the Guomindang (GMD), the Nationalist Party of China (NPC) or the Chinese Nationalist Party (CNP), is a major political party in the Republic of China, initially on the Chinese mainland and in Tai ...
,
Taipei
Taipei (), officially Taipei City, is the capital and a special municipality of the Republic of China (Taiwan). Located in Northern Taiwan, Taipei City is an enclave of the municipality of New Taipei City that sits about southwest of the n ...
was motivated to sign the ECFA with mainland China partly in hope that once it has this agreement the PRC will stop pressuring other countries to avoid such agreements with Taiwan, as well as to counteract the negative consequences of
China's free trade agreement with ASEAN.
The ECFA has been compared with the
Closer Economic Partnership Arrangements mainland China signed with the
Special Administrative Regions:
Hong Kong
Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China ( abbr. Hong Kong SAR or HKSAR), is a city and special administrative region of China on the eastern Pearl River Delt ...
and
Macau
Macau or Macao (; ; ; ), officially the Macao Special Administrative Region of the People's Republic of China (MSAR), is a city and special administrative region of China in the western Pearl River Delta by the South China Sea. With a pop ...
.
The deal is also structured to benefit Taiwan far more than mainland China. The "early harvest" list of tariff concessions covers 539 Taiwanese products and 267 mainland Chinese goods. The advantage to Taiwan would amount to , while mainland China would receive benefits estimated at . Mainland China will also open markets in 11 service sectors such as banking, securities, insurance, hospitals and accounting, while Taiwan agreed to offer wider access in seven areas, including banking and movies.
Financial reforms were kicked off on January 16, 2010 with the signing of three Memoranda of Understanding (MOU) between Taiwan's
Financial Supervisory Commission Chairman Sean Chen and three counterpart agencies in Beijing for Banking, Insurance and Securities. The FSC is hoping that Taiwan will get more leniency in the hurdles set by the Chinese government for foreign players. These hurdles have limited the growth of these foreign players relative to their local peers.
Signing and review
The negotiation process took place over several rounds. Substantive yet informal discussions regarding the ECFA initially took place during the 4th round of SEF-ARATS discussions in December 2009. During this time the delegates for China and Taiwan laid down the framework for the first round of ECFA talks which took place on January 26, 2010 in Beijing.
Kao Koong-lian
Kao Koong-lian (; born 9 November 1944) is a Taiwanese politician. He was the Vice Chairman and Secretary-General of the Straits Exchange Foundation (SEF) from 2008 to 2014.
ROC Mongolian and Tibetan Affairs Commission Chairmanship
ROC and Tibe ...
, secretary general and vice chairman of the
Straits Exchange Foundation (SEF), led the 13 member Taiwanese delegation while Zheng Lizhong, Vice President of the
Association for Relations Across the Taiwan Straits (ARATS), represented China's interests.
[Chinapost.com, (2010)]
2010/01/25 Subsequent rounds of ECFA talks took place on March 31, 2010 in Taipei and June 13, 2010 in Beijing.
The final agreement was signed during the 5th round of SEF-ARATS talks on June 29, 2010 in
Chongqing
Chongqing ( or ; ; Sichuanese dialects, Sichuanese pronunciation: , Standard Mandarin pronunciation: ), Postal Romanization, alternately romanized as Chungking (), is a Direct-administered municipalities of China, municipality in Southwes ...
.
Chiang Pin-kung, the chairman of Taiwan's SEF represented Taiwan.
Chen Yunlin
Chen Yunlin (; born December 1941) was the chairman of the Association for Relations Across the Taiwan Straits (ARATS), the body responsible for negotiations with Taiwan in the People's Republic of China in 2008–2013.
Early life
Chen was born ...
, the President of ARATS, represented mainland China.
Taiwan's
Executive Yuan
The Executive Yuan () is the executive branch of the government of the Republic of China (Taiwan). Its leader is the Premier, who is appointed by the President of the Republic of China, and requires confirmation by the Legislative Yuan.
...
approved the ECFA on July 2, 2010 and the
Legislative Yuan
The Legislative Yuan is the unicameral legislature of the Republic of China (Taiwan) located in Taipei. The Legislative Yuan is composed of 113 members, who are directly elected for 4-year terms by people of the Taiwan Area through a parallel v ...
(parliament) approved the deal on August 17, meaning the deal became law on January 1, 2011. The ECFA came into effect on September 12, 2010.
Response
Debate
ECFA was widely debated in Taiwan, in regards to potential effects on local Taiwanese businesses, as well as on how the government has presented it to the public. The opposition
Democratic Progressive Party
The Democratic Progressive Party (DPP) is a Taiwanese nationalist and centre-left political party in the Republic of China (Taiwan). Controlling both the Republic of China presidency and the unicameral Legislative Yuan, it is the majori ...
(DPP) and other
pro–independence groups believe that the free trade agreement is a "cover" for
unification with China by "inextricably linking" the two economies.
According to Jie Huang of ''China Review'', it is a means to maintain peace in cross-Strait relations and "ultimately to reach the goal of reunification."
[ A debate was held and televised on April 25, 2010.
]
Referendum proposals
In 2010, the originally-from-China pan-blue-camp-controlled several times rejected referendum proposals against Ma Ying-jeou administration's economic agreement with China even the numbers of petition forms for a referendum has been reached and nearly 200,000 signatures has been collected. The public opinion survey shows a majority of respondents opposed the signing of that package with China and many experts and politicians among protesters sees a referendum for this as essential.
Reception
There were some protests against the signing of the ECFA which would boost two-way trade organized by the Sunflower Student Movement, a popular movement that had the general support of, but was not led by, Taiwan's then opposition Democratic Progressive Party
The Democratic Progressive Party (DPP) is a Taiwanese nationalist and centre-left political party in the Republic of China (Taiwan). Controlling both the Republic of China presidency and the unicameral Legislative Yuan, it is the majori ...
.[Vancouversun.com.]
Vancouversun.com
" ''Thousands protest in Taiwan against China trade deal.'' Retrieved on 2010-06-26. A spokesman for the DPP said the trade agreement with China could damage the local economy and undermine Taiwan's sovereignty as he was against the One China market concept.[Businessweek.com.]
Businessweek.com
" ''Taiwan Opposition Holds Rally to Protest China Trade.'' Retrieved on 2010-06-26. President
President most commonly refers to:
*President (corporate title)
*President (education), a leader of a college or university
*President (government title)
President may also refer to:
Automobiles
* Nissan President, a 1966–2010 Japanese ful ...
Ma Ying-jeou responded that the signing would not lead to a One China market.
Many protesters accuse the agreement as eventually leading Taiwan towards unification with mainland China. The DPP claimed that 100,000 took part in the protest, while the police said there were about 32,000 people. The demonstration started at 3pm and ended by 7pm.
Clash in the legislature
On July 8, 2010 a Legislative Yuan
The Legislative Yuan is the unicameral legislature of the Republic of China (Taiwan) located in Taipei. The Legislative Yuan is composed of 113 members, who are directly elected for 4-year terms by people of the Taiwan Area through a parallel v ...
meeting was held. The DPP insisted the ECFA agreement be reviewed article by article. That demand was rejected by the KMT caucus.[Taipeitimes.com.]
Taipeitimes.com
" ''Legislators brawl over ECFA review.'' Retrieved on 2010-07-10. A six-minute fight then broke out among the legislators. Wang Jin-pyng was at the podium surrounded by other KMT legislators. Liu Chien-kuo
Liu Chien-kuo (; born 9 March 1969) is a Taiwanese politician. A former member of the Yunlin County Council, he has represented Yunlin County in the Legislative Yuan since 2009.
Education
Liu has earned two bachelor's degrees, one from Nation ...
, Su Chen-ching (蘇震清) and Kuo Wen-chen (郭玟成) attempted to get to him and failed. Lawmakers threw paper, water and trash at each other. KMT legislator Wu Yu-sheng (吳育昇) was hit in the head by a clock. He had to be transported to National Taiwan University Hospital
The National Taiwan University Hospital (NTUH; ) is a medical facility located in the Zhongzheng District of Taipei, Taiwan. It started operations under Japanese rule in Daitōtei (today's Dadaocheng) on 18 June 1895, and moved to its present ...
.[etaiwannews.com.]
etaiwannews.com
" ''Taiwan legislature clashes mark start of ECFA review.'' Retrieved on 2010-07-10. A number of other people were involved in the scuffle. Two KMT legislators held DPP chairwoman Tsai Ing-wen responsible for the clash.
See also
* Cross-Strait relations
* Cross-Strait Service Trade Agreement
*Political status of Taiwan
The controversy surrounding the political status of Taiwan or the Taiwan issue is a result of World War II, the second phase of the Chinese Civil War (1945–1949), and the Cold War.
The basic issue hinges on who the islands of Taiwan, Peng ...
* Mainland and Hong Kong Closer Economic Partnership Arrangement (CEPA)
*Mainland and Macau Closer Economic Partnership Arrangement
The Mainland and Macau Closer Economic Partnership Arrangement, or Closer Economic Partnership Arrangement (CEPA) for short, is an economic agreement between the Government of the Macau Special Administrative Region and the Central People's Gover ...
(CEPA)
Notelist
References
External links
English translation of the Economic Cooperation Framework Agreement
Ministry of Economic Affairs, Republic of China
Taiwan Affairs Office of the State Council
Straits Exchange Foundation
{{Economy of Taiwan
2010 in China
Treaties concluded in 2010
2010 in Taiwan
Cross-Strait relations
Treaties of the People's Republic of China
Treaties of Taiwan
Treaties entered into force in 2010