Minister Without Portfolio John Deng’s various government assignments helped prepare him for the role of Taiwan’s lead negotiator as the head of the Office of Trade Negotiations (OTN). Following several successful negotiations – including one that secured Taiwan’s membership in the World Trade Organization – Deng is now focusing his expertise on trade negotiations with the United States under the U.S.-Taiwan Initiative on 21st-Century Trade.
TOPICS Senior Editor Julia Bergström sat down with Deng at the Ghost Island Media recording studio in mid-May to discuss leadership, what makes for a successful negotiator, and Taiwan’s journey from a closed to open economy. An abridged version of their conversation follows. To listen to the extended podcast version, visit topics.amcham.com.tw/listen.
How did you start your journey to become Taiwan’s lead negotiator?
Nearly 50 years ago, after I completed my military service, I had to make a decision about finding a job. At that time, the relationship with the United States was one of the most crucial matters for Taiwan, so I decided to join the Ministry of Economic Affairs. My real engagement with practical experiences began when I was assigned to Washington, D.C., in 1979. My primary task then was dealing with the United States regarding textiles.
Taiwan had started producing high-quality textiles, including shirts, pants, and sweats. At the time, China was still under the influence of the cultural revolution and had no products to ship to the U.S., so Taiwan became one of the largest exporters of textile products to the United States. But to protect the local textile workers, the U.S. imposed quotas on imports. Our job was to negotiate to obtain higher quotas. This situation persisted for approximately five to six years.
During that time, I held the title of Third Secretary. Although it was the lowest position in the office, I had the privilege of working under many exceptional bosses. I also had the opportunity to observe the outstanding negotiators from the U.S. Trade Representative and the Commerce Department within the U.S. government. As a young third secretary, I learned a great deal by watching them negotiate. I witnessed their debates, their fights for their industries, and how they presented their arguments. Overall, the U.S. continued to provide Taiwan with a sufficient quota that allowed our textile industry to continue growing.
Looking back, I consider the outcome of this process a happy one. Although the journey was sometimes challenging, the positive result speaks for itself. We made many friends among the negotiators, who maintained a strong friendship with Taiwan despite moving on to other roles. I would give a high grade to that experience.
What makes for a successful negotiator?
Firstly, you need to have a detailed understanding of the subject matter. For example, if it’s T-shirts, you should get a good grasp of the production process, including cutting, sorting, packaging, and pricing. You should also visit production sites and gather comprehensive information about the global T-shirt market, such as market size, exporters, buyers, and sellers. Understanding the dynamics of the area being negotiated is vital. It’s also important to consider the other side’s perspective, asking questions like why they impose limits and who and what might be influencing their decisions.
It’s crucial to be curious and eager to learn. Understanding why certain expressions or word choices are used can help navigate the negotiations effectively. Being friendly and seeking to make connections, even in challenging meetings, is a characteristic often observed in people from Taiwan, and I think those are helpful traits to have, too. Flexibility and the willingness to explore alternative solutions when facing roadblocks are also valued traits in negotiations.
Early in your career, you studied law at George Washington University. What did the experience teach you that you still use today?
My time as a law student in the United States was a valuable experience, despite the high cost and the challenges of being an international student. It was a decision I’m glad I made, and the process was worthwhile. Studying law gave me a deeper understanding of society. It’s not just about the law itself, but also about the language used in legal systems, which reflects a society’s thinking, culture, and historical context. Learning about law in a systematic way allowed me to grasp these important aspects rather than merely gathering bits of information here and there.
I also had the opportunity to make lifelong friends as a law student, and these friendships have endured and enriched my life.
Tell us about the U.S.-Taiwan Initiative on 21st-Century Trade – what is it, and why is it important?
We are delighted that last year in August, we launched the 21st-Century Trade Initiative, aiming to establish a trade agreement – a breakthrough that eluded us for the past 30 years. The progress in negotiations so far proves the effectiveness of this initiative. We have already reached agreements on good regulatory practices, anti-corruption measures, trade facilitation, small and medium-sized enterprises, and domestic regulations.
There are still important topics awaiting negotiation, such as agriculture, environment, labor, and strong enterprise economic coercion standards. We believe that successfully completing these areas of negotiation will bring significant advantages to businesses on both sides.
In the initial stages of negotiations, we have demonstrated that both governments have the capability to accomplish this feat. Our business community, government, and people here in Taiwan are excited about the opportunity to collaborate with the U.S. government. These achievements represent a long-awaited milestone that we have strived for over a considerable period of time.
How would you describe your leadership style? What type of culture do you foster at OTN?
I believe in fostering a culture that encourages individual thinking and avoids rigidity. Our world is complex and challenging, and there is no one-size-fits-all answer or right path – it requires considering different perspectives and aspects to develop better approaches. Because of this, I encourage my colleagues to think independently and not always rely on seeking my opinion. Instead, I urge them to conduct their own research and develop their approaches in the early stages before sharing my own opinions.
In my experience, I’ve received positive feedback from our counterparts in the U.S. government regarding our proficiency and flexibility during the negotiations under the 21st-Century Initiative framework. This feedback makes me proud of the Office of Trade Negotiations. I believe our recent success highlights the importance of maintaining a mindset of openness, adaptability, and critical thinking in our work.
What advice would you give businesses when it comes to interacting with government?
AmCham is an incredibly effective organization for maintaining dialogue with the government. The presence of my Cabinet colleagues at your Hsieh Nien Fan demonstrates the enthusiastic attitude of the government toward engaging with AmCham. When it comes to dealing with specific issues, I can confidently say that most ministries are very open to AmCham members and their respective committees. While there may be disagreements on certain matters, we now have a system where both the U.S. government and the Taiwan government meet regularly through committees or dialogue groups. This creates additional avenues for AmCham members to leverage and ensures that there is a channel of communication between AmCham, the Taiwan government, and the U.S. government.
Still, it’s important to manage expectations and not assume that everything desired can be obtained. There needs to be a balance in all aspects. While businesses may want good prices for their products, government agencies may have concerns about budgetary constraints. I particularly pay attention to the concerns of AmCham members, especially those in the pharmaceutical industry.
What changes have you seen in Taiwan’s relationship with the international community in the past few decades?
The Taiwanese system follows a bottom-up approach, considering every aspect and detail and designing our system according to our specific needs. However, when we applied to join the WTO, we had to adhere to a set of rules that members use to examine our system’s compatibility. One area of consideration was the government’s right to make decisions. We believed that the government should have the authority to determine factors such as the quantity of rice imports for safety reasons, as it required policy space. In response, the U.S. government would ask for our standards and the rationale behind them.
Initially, it took time to understand why foreign governments were interested in our decision-making processes. However, looking back at the past 20 years, we can recognize the importance of democracy. It means that the government must be transparent, informing the people about its actions and not keeping everything secret. We discovered numerous laws and regulations that colleagues had implemented without public knowledge, but through the WTO accession process, everything had to be brought to the table and disclosed. This experience led to significant improvements in our thinking, changes in laws, and a more competitive industry in Taiwan. It was a fundamental shift in concepts and the government’s expectations of openness.
Opening up also meant that certain sectors could no longer receive special protection or favoritism. Fairness and competition became essential. However, this process was difficult for certain sectors, such as the rice industry. Other countries like the U.S. and Australia had large-scale mechanized rice farming, while Taiwan still relied on smaller machines. The level of protection given to rice farmers in Japan, for example, was even stronger than ours. Despite these challenges, we implemented systems like farmers’ insurance, crop insurance, and the national health plan, which improved conditions for farmers and their families.
Transparency and fair regulations are what attract businesses to Taiwan. Knowing that our laws and regulations meet international standards is crucial. We are confident in our efforts to join the The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and we believe that when people review our system, they will take note of its transparency and adherence to international standards.
What do you like to do in your spare time to relax and recharge?
I’m a simple person, and sometimes even the smallest things can bring me pleasure – seeing friends, listening to good music, and just going out to enjoy the natural beauty of Taiwan. Taiwan is a wonderful place that offers numerous opportunities and experiences to explore.