Taiwan is in talks with the 11 members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and will formally submit an application to join the Trans-Pacific Partnership once the informal consultations are complete, according to the island’s foreign ministry.
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Why it matters: While Taiwan is a member of the World Trade Organisation (WTO), other trade deals have been hard to come by for Taiwan as many countries fear potential retribution from China, who has been claiming the democratic island as its territory since 1949.
• A modern technology powerhouse, Taiwan is one of the world’s leading producers of technology products. The World Economic Forum ranked Taiwan 13th out of 140 economies in a Global Competitiveness Report released in October 2018.
• In a statement on Sunday, Taiwan’s Foreign Ministry said that potential applicants to the CPTPP are required to complete informal talks with existing members to “reach a consensus” before they would be allowed to apply, according to Reuters.
• The CPTPP is the fourth largest free-trade area in the world by GDP, behind the United States–Mexico–Canada Agreement, the European Single Market, and the Regional Comprehensive Economic Partnership, which was signed last month.
More details: The current member countries “already clearly understand our determination and steps to seeking membership, and the attitude is quite positive,” Taiwan’s foreign ministry said in a statement.
• A potential roadblock for Taiwan, however, could be China, who are also debating joining the CPTPP.
• At the APEC Economic Leaders’ Meeting last month, Chinese President Xi Jinping said China would “actively consider” signing up for the CPTPP.
• The CPTPP includes the most detailed standards for intellectual property of any trade agreement, and also includes protections against intellectual property theft against corporations operating abroad.
• The original Trans-Pacific Partnership (TPP) agreement was signed in February 2016, but US President Donald Trump withdrew his country from the agreement soon after being elected, which led to the original deal being called off.
• It is unclear whether the US will join the CPTPP under President-elect Joe Biden, who will be inaugurated on January 20, 2021.
Looking ahead: Taiwan was unable to join RCEP due to China’s influence over the trade deal, the largest trade agreement in the world.
• Interestingly, Taiwan economic minister, Wang Mei-hua said a month ago that the time was not right for Taiwan to join the CPTPP.
• The opposition Kuomintang (KMT) recently submitted plans to the Legislative Yuan to freeze or cut at least NT 4 billion (USD 142 million) from the NT 20 billion allocated for defence in Taiwan’s 2021 budget. It is also aiming to reduce spending for the island’s campaign to join the CPTPP, CNA reported.
• The KMT’s move was criticised by Taiwanese President, Tsai Ing-wen on Saturday, who said that opposition action to cut or freeze budgets for the CPTPP would cause foreign countries to misunderstand Taiwan’s intentions.