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Taiwan submits bid to join CPTPP trade pact

  • September 23, 2021
  • , Nikkei Asia , 3:48 a.m.
  • English Press
  • , ,

YU NAKAMURA, TOMOHIRO EBUCHI and SATSUKI KANEKO, Nikkei staff writer

 

TAIPEI/TOKYO — Taiwan has formally applied to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the cabinet said late Wednesday, in a move expected to trigger opposition from China.

 

Taiwanese authorities have submitted the application to New Zealand, which acts as the depositary for the Pacific rim trade pact, and sought the support of all existing members. Details on the application will be announced Thursday.

 

The move comes less than a week after China last Thursday applied for membership in the CPTPP, which sets rules for tariff-free trade and investment and data flows. The timing suggests a rush by Taipei in response to Beijing’s bid.

 

In order to join the CPTPP, Taiwan will need approval from all 11 of its existing members, which include Japan and Australia. The island already has bilateral free trade agreement with New Zealand and Singapore, another CPTPP member.

 

Securing membership in the CPTPP has been a goal for Taiwanese President Tsai Ing-wen, who has not sought to join the Regional Comprehensive Economic Partnership, a China-led regional trade pact that also includes Southeast Asia, Japan, South Korea, Australia and New Zealand.

 

Taiwan’s bid is likely to be followed by diplomatic wrangling as Taipei and Beijing each seek to influence existing CPTPP members.

 

“The Japanese government sees the application from Taiwan, which upholds democratic values and the rule of law, as a positive development,” a Japanese Foreign Ministry official told Nikkei on Wednesday.

 

Flags of CPTPP members: Participation in the trade pact requires the approval of all current parties. (Photo by Wataru Ito)
 

Japan does not have a free trade agreement with Taiwan. “We have never engaged in informal negotiations that focused on the areas covered [by the CPTPP], so it is hard to judge what hurdles Taiwan will face” in its membership bid, a Japanese trade official said.

 

Tokyo’s reaction contrasts with the more guarded stance on China’s application last week. Top Japanese officials have questioned whether Beijing can meet the high standards set by the CPTPP.

 

Taiwan has been unable to join some international bodies due to opposition from China, which considers Taiwan as part of its territory. At Asia-Pacific Economic Cooperation forum summits, retired entrepreneur Morris Chang — the founder of Taiwan Semiconductor Manufacturing Co., the world’s largest contract chipmaker — has represented Taiwan in an unofficial capacity.

 

Because new members require unanimous approval, China would likely block Taiwan’s application if it secures membership first and vice versa. Rifts are already starting to emerge within the CPTPP on which side to choose.

 

Singapore and Malaysia have welcomed Beijing’s application. Meanwhile, Mexico stopped short of a welcome, instead emphasizing the need to meet the pact’s standards. Chinese membership could hurt the chances of bringing back the U.S., Mexico’s biggest trading partner, which withdrew from the original Trans-Pacific Partnership under the Trump administration.

 

Australia has also expressed reservations about China joining the CPTPP. Beijing has imposed trade restrictions on Australian barley, wine and coal after Canberra called for an independent inquiry into the origins of the coronavirus. Australian trade minister Dan Tehan has said the country will oppose China’s bid unless these issues are addressed.

 

China firmly opposes any agreements of a sovereign nature between countries with which it has diplomatic relations and Taiwan, a spokesperson for the Taiwan Affairs Office of the State Council was quoted as saying by the Chinese Communist Party-affiliated Global Times. The Global Times described Taiwan’s CPTPP bid as a “distraction.”

 

Under rising pressure from Beijing, Tsai’s government has also made a move toward negotiating a free trade agreement with the U.S. In June, Taiwan and the U.S. revived talks for the first time in roughly five years under the 1994 Trade and Investment Framework Agreement, a preparatory step to discussing an free trade agreement.

 

Taiwan’s bid to join the CPTPP could also face pushback at home over market access. Taiwan has banned food imports from Japan’s Fukushima Prefecture and four nearby regions since the nuclear disaster there in 2011. The Taiwanese public opposes restarting this trade, and Tsai for years has been reluctant to tackle the issue.

 

The CPTPP’s other members are Brunei, Canada, Chile, Peru, and Vietnam. The U.K. has begun negotiations to join the framework as well.

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