In a momentous milestone that’s set to bolster the bilateral economic relationship between Taiwan and the United States, the first agreement under the U.S.-Taiwan Initiative on 21st-Century Trade was signed on June 1 this year. Taiwan and the United States have established a wide-ranging and permanent communication platform through this agreement.
“This agreement is a strong signal of continued U.S. support for Taiwan in the international community,” says Minister without Portfolio and Trade Negotiation Representative John Deng. He adds that “businesses of all sizes stand to gain several advantages as a result.”
Five areas have been negotiated in the first agreement: customs administration and trade facilitation, good regulatory practices, services domestic regulation, anticorruption, and small and medium-sized enterprises. Additionally, preliminary discussions are underway in the areas of agriculture, environmental issues, and labor.
“With the future agreement on agriculture and labor, we hope to expand the market for Taiwan’s high-quality food products and increase both imports and exports to and from the U.S. and Taiwan,” says Deng.
Regarding customs administration and trade facilitation, both sides aim to streamline border procedures and reduce bureaucracy, enabling smoother trade flows and expediting customs processes. “We will work together to facilitate the movement of goods by allowing the use of more digital tools in the customs process,” Deng notes.
Implementing digital tools will facilitate the submission of customs forms and electronic payment of duties, taxes, and fees, benefitting American businesses already engaged in or seeking to enter the Taiwanese market. Moreover, these measures will contribute to environmental sustainability by reducing greenhouse gas emissions and preventing spoilage of perishable goods.
“We have also agreed in the section on good regulatory practices to offer more opportunities for public comments, including adequate time for response and feedback,” Deng adds. “After receiving feedback on issues, committees will work bilaterally to solve public problems.”
The negotiated text on good regulatory practices promotes transparency and public engagement, particularly through public consultations on draft regulatory measures. By ensuring better-informed regulations, the agreement empowers SMEs and facilitates their understanding of regulatory procedures in the U.S. and Taiwan markets.
Addressing corruption concerns, the negotiated text on anticorruption establishes comprehensive measures to prevent and combat bribery and corruption. These measures build upon the framework outlined in the United States-Mexico-Canada Agreement and encompass areas such as money laundering, denial of entry for foreign public officials, asset recovery, and whistleblower protection. Additionally, the agreement outlines procedures for the potential removal of public officials charged or convicted of corruption.
“Under the anticorruption agreement, we hope to provide a level playing field for those who follow the rules,” says Deng.
Recognizing the vital role of SMEs in economic growth, the agreement emphasizes fostering trade and investment opportunities for these enterprises. Measures include training programs, trade education initiatives, trade finance facilitation, trade missions, and improved access to capital and credit. The agreement also emphasizes inclusivity by encouraging the participation of diverse, underserved, and underrepresented SMEs in dialogues and other support programs.
The services domestic regulation component of the agreement ensures fair treatment for service suppliers during the licensing process. Independent regulators will provide applicants with clear guidelines, a reasonable opportunity to meet requirements, and timely decisions on license issuance. Additionally, gender-based discrimination in licensing rules is explicitly prohibited, promoting equality and inclusivity.
OTN Assistant Trade Representative Richard Huang emphasizes the shared goal of both parties in the agreement to streamline the movement of goods while actively engaging with stakeholders and the general public throughout the negotiation and implementation of new trade policies.
“When we work with the various stakeholders, we make sure to actively listen to their needs and address the requirements of businesses and consumers,” says Huang. “This approach ensures that the agreements are more inclusive and yield higher productivity.”
Looking forward to the future confirmation of the remaining areas of the 21st-Century Initiative as well as implementation of the first agreement, Deng and his team will continue to strive for enhanced relationships and increased trade between the U.S. and Taiwan.
“We encourage businesses to continue to invest in Taiwan, hire more employees, and strive to meet internationally recognized standards to help increase Taiwan’s competitiveness,” says Deng. “Many new opportunities are coming, so it’s best to be ready.”