Despite political deadlock, the first Cross-strait Economic and Trade Forum provides a new platform for both sides of the Taiwan Strait to discuss trade issues
　　
　　The first Cross-strait Economic and Trade Forum, postponed from dates in August and September in Taipei due to a politically sensitive situation between Taiwan and China’s mainland, finally began April 14 in Beijing.
　　Attended by over 400 people including officials from the Communist Party of China (CPC), Kuomintang (KMT), People First Party and New Party, as well as economic experts and business people, the two-day-long forum closed with seven-point joint proposals and 15 new policies for the Chinese mainland to promote economic and trade relations across the Taiwan Strait.
　　“These policies, along with the consensus reached at the forum, are more than what we expected,” said Chinese KMT Honorary Chairman Lien Chan, who headed a KMT delegation, at a press conference after the forum. KMT Vice Chairman Wu Po-hsiung said at the forum’s closing ceremony that with these policies, the Taiwanese people will feel the sincerity of the mainland.
　　The policy package was announced by Chen Yunlin, Director of the Taiwan Work Office of the CPC Central Committee. It covers issues related to Taiwan’s agricultural and aquatic products, cross-strait agricultural cooperation, recognition of university diplomas issued in Taiwan, visits between mainlanders and Taiwanese, and Taiwanese becoming customs agents and being engaged in medical services on the mainland.
　　Among the 15 policies, seven are related to agriculture and fishery, which, according to a commentary published in Hong Kong-based Ming Pao newspaper, may shake Chen Shuibian’s base of supporters in the southern part of Taiwan and also match up with the mainland’s plan of building a “new socialist countryside.”
　　The Ming Pao article also noted that the mainland presented this gift on the eve of President Hu Jintao’s U.S. state visit, trying to convey to the United States that it has the sincerity to promote cross-strait economic and trade relations, as well as communication.
　　Indeed, the 15 new policies were well received by participants of the forum, many of whom considered them very positive. Winston Chang, President of the Xuzhou Association of Taiwanese-invested Enterpri-ses, said that with the mainland’s recognition of university diplomas issued in Taiwan, graduates of Taiwan will be able to work as professionals on the mainland, which is a great benefit for Taiwanese youth with relatively few opportunities after graduation.
　　Xie Kungzong, President of the Beijing Association of Taiwanese-invested Enterpri-ses, said he thought highly of the measure that Taiwan visitors may receive necessary documents from mainland hospitals and clinics for conveniences such as reporting medical expenditure upon returning home. He said this will greatly improve the life of Taiwanese businesspeople on the mainland.
　　
　　Joint proposals
　　
　　The Cross-strait Economic and Trade Forum, jointly organized by institutions under the CPC and the KMT, is a key part of the five common aspirations and prospects agreed upon by General Secretary of the CPC Central Committee Hu Jintao and the then KMT Chairman Lien Chan last April, and is also an important activity for the two parties to continue communication, according to Li Bingcai, Deputy Director of the Taiwan Work Office of the CPC Central Committee.
　　Li announced the seven-point joint proposals, reached after two days of discussions on how to further implement negotiation results achieved by the CPC and KMT during the past year.
　　The joint proposals suggest the promotion of cross-strait direct transport, agricultural, financial and economic exchanges, and cooperation and visits of mainlanders to Taiwan.
　　The proposals stated that the mainland will make the financing of small and medium-sized Taiwan-invested enterprises more convenient, encourage and support service industries from Taiwan to enter the mainland market and also urge Taiwan’s leaders to let financial institutions from the mainland set up branch offices in Taiwan.
　　At the closing ceremony, Vice Chairman of the KMT Wu Po-hsiung asked Taiwan, led by the Democratic Progressive Party, to implement the proposals put forward by this forum.
　　KMT legislator Ho Tsai-feng, who participated in the forum as a people’s representative, said she and 32 other KMT legislators attending this forum will bring the consensus and feedback back to Taiwan. She said she was quite confident in the realization of the consensus, as Taiwan’s leaders have already been “l(fā)ess intransigent” under pressure from opposition parties and legislators.
　　Direct flights across the Taiwan Strait at fixed dates and fixed destinations have been put into plan, Ho Tsai-feng said, although these flights haven’t yet begun. Fixed dates previously referred to the Spring Festival, for example, but now these dates will be expanded to include more festivals and holidays, and even Western festivals, Ho explained.
　　Sean Lien, Managing Commissioner of the KMT Central Committee, also expressed his confidence in the consensus reached in this forum. “Some people said that the conclusion of this forum does not have the power of execution. Wrong. At least, it will pose a huge pressure on the Taiwan authorities,” Lien opined.
　　Another KMT legislator, Ting Shou-chung, expressed the same hope as Ho, that the realization of the joint proposals would not take long, as “to grab the [potential] achievements [of this forum], the Democratic Progressive Party had already taken some oaths before the opening of this forum.” Ting said the legislators will continue to push for direct transport across the Taiwan Strait. He also said he hoped the mainland would come out with more detailed measures in terms of cross-strait communications and exchanges.
　　On April 16, one day after the conclusion of the Cross-Strait Economic and Trade Forum, three central government departments--the National Tourism Administration, Ministry of Public Security and Taiwan Affairs Office of the State Council--jointly issued a 17-article regulation for managing the travel of mainland residents to Taiwan.
　　The regulations stipulate that mainland visitors must tour Taiwan in groups organized by mainland travel agencies that are designated by government departments, while Taiwan travel agencies receiving mainland tourists should also be confirmed by departments on the mainland.
　　According to a report by the official Xinhua News Agency, the National Tourism Administration and related government departments will adopt a quota system for tourist groups to Taiwan, and the quotas will be given to mainland travel agencies who have signed cooperative contracts with Taiwan counterparts.
　　The Xinhua report said, “On May 3, 2005 the mainland said it would allow mainland residents to travel to Taiwan in the near future. To date the mainland has got everything ready, and is only awaiting a response from Taiwan for such tours to start.”
　　
　　Topics discussed
　　
　　Cross-strait agricultural, tourism and financial service exchanges and cooperation, and direct air and shipping links, were hot topics discussed during the two-day forum.
　　Several keynote speakers noted that the mainland has become Taiwan’s largest export market and the largest contributor to Taiwan’s trade surplus, while Taiwan is the second largest import market for the mainland. The cross-strait trade volume has grown steadily, said Tang Wei, Vice Chairman of the Association of Economy and Trade Across the Taiwan Strait.
　　Last year, trade across the Taiwan Strait reached $91.23 billion, up 16.5 percent from the previous year. Of this, $16.55 billion was exported from the mainland to Taiwan, an increase of 22.2 percent compared with 2004, and $74.68 billion was exported from Taiwan to the mainland, up 15.3 percent, according to Tang. He called for a pragmatic attitude toward the realization of the “three direct links,” which include direct trade, mail and transport services.
　　As calculated by Lin Chu-chia, a professor at Taiwan’s Chengchi University, during a speech at the forum, about NT $31 billion in costs will be saved if direct links in air and shipping across the Taiwan Strait are realized. Lin said that direct links of air and shipping services will help to save around NT $30 billion and NT $840 million of costs, respectively.
　　In terms of the agricultural aspect, participants gave much credit to the zero tariff on a number of fruit originated from Taiwan, considering it good news for Taiwan farmers. Wu Torng-chuang, a consultant of the science, technology and economy group of the Taiwan-based National Policy Foundation, said the mainland and Taiwan continue to exchange plant seeds and seedlings. He suggest the mainland increase fruit imports from Taiwan while learning how to deal with agricultural work in a more business-oriented way from the experiences of Taiwanese small farmers.
　　Cooperation in the financial service sector is another hot issue at the forum, since China will fully open its financial markets by the end of 2006, according to its World Trade Organization commitments.
　　Song Fengming, a professor at Tsinghua University’s School of Economics and Management, said that current cross-strait financial exchanges do not provide the necessary financial services for business and trade across the Taiwan Strait. The lack of a communication platform and different standards in statistics and accounting, as well as different financial regulations, are all obstacles to cross-strait financial cooperation, Song said. But he added that the biggest problem is obstacles created by Taiwan’s leaders.
　　Ba Shusong, Deputy Director of the Finance Research Institute of the Development Research Center of the State Council, pointed out in his speech that there is an imbalance in the opening-up of cross-strait financial sectors. According to Ba, by the end of 2005 the mainland had approved seven bank offices from Taiwan, two joint-venture banks with Taiwan, 15 offices of 11 Taiwan insurances firms, one insurance broker company and one insurance joint venture. But Taiwan was too rigid on giving mainland financial institutions the go-ahead to open offices on the island, he added.
　　In 2003, the mainland gave approval to four banks, Shanghai Pudong Development Bank, China Merchants Bank, Industrial Bank Co., Ltd. and the Industrial and Commercial Bank of China Hong Kong, to set up offices in Taiwan, but no substantial progress has been made since then because of strict measures taken by Taiwan, Ba said.
　　These issues, discussed at the forum, aren’t only a business matter between the CPC and KMT, but a weightier one that concerns people living on both sides of the Taiwan Strait, said Lien Chan in a press release after the forum.
　　
　　Second Hu-Lien meeting
　　
　　A year after Lien Chan’s ice-breaking visit to the mainland last April and his first-ever meeting with President Hu, the two met again in Beijing following the forum.
　　Commenting on developments since their last meeting, Lien gave examples in the economic sector over the past year, such as the expanded chartered flight service during the Chinese Spring Festival, the export of Taiwan’s agricultural products to the mainland market, the establishment of a mechanism to solve problems for Taiwan business people operating on the mainland, and efforts for standardization between Taiwan and mainland China’s information technology sectors, according to an official Xinhua report.
　　During their recent meeting, Hu made four suggestions on the peace and development of cross-strait relations. He said that the “1992 Consensus,” which refers to the common belief that both the mainland and Taiwan belong to one China, is the foundation for peace and development across the Taiwan Strait.
　　“It’s the ultimate goal to seek interest for the people across the Taiwan Strait when we are working for peaceful development in cross-strait relations,” said Hu, as his second suggestion.
　　He added that a mutually complementary and beneficial relationship is the effective way to realize peaceful development, and equal consultation is the only way to achieve peaceful development across the Taiwan Strait.
　　“Cross-strait relations are now in a seesaw struggle between peace and opening-up on one side, and conflicts and closure on the other,” said Lien Chan in his meeting with Hu. He called on both Taiwan and the mainland to work toward unity, peace and opening-up.
　　According to Xinhua, Lien praised the 15 new policies to promote cross-strait economic and trade relations, saying that they create opportunities for brighter prospects. “The key problem is how to enable the Taiwanese people to enjoy the benefits of booming economic growth in the face of a crisis of ‘marginalization’ due to several years of self-closure in the island,” Lien emphasized.
　　
　　Five Common Aspirations and Prospects
　　
　　The CPC and KMT jointly issued a press communiqué April 29, 2005, which states that the two parties have reached a five-point consensus for “promoting peace and development across the Taiwan Strait.”
　　According to the communiqué, the two parties have agreed to work together to promote an earlier restoration of cross-strait talks, the formal end of hostility across the Taiwan Strait, all-around economic and trade relations and “three direct links” across the Taiwan Strait, discussions of Taiwan’s participation in international activities and the establishment of a regular platform for party-to-party exchange:
　　-- Promote the earlier restoration of equal consultations across the Taiwan Strait on the basis of the “1992 Consensus,” discuss issues of common concern and issues concerned by each party, and promote the favorable and sound development of cross-strait relations
　　-- Promote the formal end of hostility across the Taiwan Strait and reach a peace accord, establish a framework for peaceful and steady development of cross-strait relations, including a mechanism of military mutual trust in order to avoid armed conflicts between the two sides
　　-- Promote economic cooperation across the Taiwan Strait and establish close economic and trade cooperative relations, including all-round, direct and two-direction “three links,” opening direct air and marine transport, strengthening exchanges and guarantees of investment and trade, carrying out agricultural and fishing cooperation, sales of Taiwan farm products on the mainland, improving exchange orders, jointly cracking down on crime, establishing a stable economic cooperation mechanism and discussion of the cross-strait common market
　　-- Promote discussion on the issue of Taiwan’s participation in international activities after the resumption of dialogue across the Taiwan Strait, including priority given to discussion about Taiwan’s participation in World Health Organization activities, with the two sides jointly finding a step-by-step resolution to the issue
　　-- Establish a regular communication platform between the two parties, including visits between party members at different levels, holding discussions on issues related to improving cross-strait relations and inviting people from all walks of life to join in discussions on issues concerning the interests of people across the Taiwan Strait
　　
　　New Policies to Promote Cross-strait Trade and Economic Ties
　　
　　China announced at the closing ceremony of the first Cross-strait Economic and Trade Forum a package of 15 policies to promote economic and trade relations across the Taiwan Strait.
　　The package is comprised of three sets of policies directly stipulated by the State Council and 12 others formulated by departments under the Central Government.
　　
　　The three sets of State Council policies follow:
　　--Add four species to a list of Taiwan-grown fruits, currently naming 18 species, for Taiwan exporters
　　--Adopt a zero-tax policy on imports of 11 kinds of vegetables produced by Taiwanese farmers
　　--Allow more imports of Taiwan’s aquatic products, with no tax on some of the products, and apply the same policies to Taiwanese fishing boats as to their mainland counterparts in terms of selling their own products
　　
　　The other 12 policies are as follows:
　　--Three more cross-strait agricultural cooperation pilot zones will be set up in the mainland cities of Foshan and Zhanjiang, in Guangdong Province, and Yulin in Guangxi Zhuang Autonomous Region. Moreover, Zhangpu City of Fujian Province and Qixia City of Shandong Province will establish two business hatching parks for Taiwanese farmers.
　　--The mainland’s federation of supply and marketing cooperatives will help organize mainland farm product dealers to visit Taiwan for group procurements during the peak fruit harvest seasons.
　　--A special marketing center will be set up in Xiamen City, Fujian, to increase convenience and reduce costs for Taiwan’s fruit imports.
　　--The mainland will open a “green corridor” for transportation of Taiwan fruit, to reduce shipping costs.
　　--The mainland will recognize university diplomas issued in Taiwan.
　　--The mainland will issue the Method on the Management of Mainland Residents to Visit Taiwan Area.
　　--The Ministry of Public Security will add Shenyang, Dalian and Chengdu to the cities that can issue valid passes for Taiwanese visitors to enter the mainland, in addition to the current five cities-Haikou, Sanya, Xiamen, Fuzhou and Shanghai.
　　--Taiwanese people will be allowed to become customs agents after passing official examinations on the mainland.
　　--Special clinics will be established for Taiwanese visitors in some mainland cities. Doctors working in these clinics could come either from the mainland or from Taiwan, but they have to acquire official approval by mainland authorities.
　　--In the future, Taiwanese visitors may receive necessary documents from mainland hospitals and clinics in order to more conveniently report medical expenditures when they return home.
　　--Taiwanese investors will be allowed to establish joint venture hospitals on the mainland with local partners, while investors from Taiwan could hold as much as a 70 percent stake.
　　--Taiwanese people will be allowed to receive a license for medical practice on the mainland after they pass official examinations. They will be permitted to work on the mainland for a period of one year, but the term could be extended by mainland authorities after expiration.
　　
　　Source: Xinhua News Agency

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