[Viewpoint] Pursuing economic ties with China

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[Viewpoint] Pursuing economic ties with China

Taiwan benefits far more than China from the Economic Cooperation Framework Agreement, a kind of free trade agreement with China that was signed in June 2010. Thanks to reduced tariffs and other trade barriers, Taiwan raked in a surplus of $86 billion in trade with the mainland last year. China is well aware that the deal is a far bigger boon to Taiwan since the mainland offers greater market openings, yet Beijing has agreed to the pact with a long-term view.

Free trade agreements often carry strategic meaning beyond just a business calculation. When the U.S. Congress ratified the free trade agreement with Korea, the deal was highlighted for pushing the two countries’ bilateral defense alliance to an economic alliance. Now that the pivotal Seoul mayoral by-election is over, legislators from both sides have returned to the political ring and are clashing over the ratification of the Korea-U.S. FTA. The yardstick used to decide whether to approve the pact should be simple. It should be addressed as an issue that concerns the future of the country’s security and economic prospects. National interests should decide the matter, not political math.

Once we wrap up the free trade agreement with the United States, we should move on to the next stage. We must study a similar tariff-free market opening and trade pact with the world’s second-largest economy. China is our biggest trade partner, with bilateral trade topping $200 billion last year. The amount exceeds last year’s combined trade with the United States and Japan. Our entire economy depends on how we steer and manage trade, business and our economic partnership with China.

From an economic view, China should come first in economic partnership. The Chinese leadership is fortunately eager to formulate a free trade arrangement with Korea. President Hu Jintao and Prime Minister Wen Jiabao have several times proposed initiating talks on a bilateral free trade agreement.

But it remains unclear if the Seoul government has given serious thought to the issue. According to Beijing sources, the Chinese government has repeatedly requested that President Lee Myung-bak visit Beijing to discuss the matter and declare the formal opening of FTA talks within the year. But the Seoul government has been shying away from the talks, citing a tight schedule. But strangely, President Lee Myung-bak seems to have time to travel to many other countries.

It may be that the government is buying time as it has failed to reach a consensus on its negotiation strategy. Chinese Vice Premier Li Keqiang visited Seoul last week but could not raise the issue with Korean officials.

Elections and power transitions are scheduled in Korea and China next year. If the two countries do not initiate talks this year, negotiations on a free trade agreement will have to be pushed back to 2013.

A free trade agreement allows symbiotic growth and cooperation within a liberalized trade framework. We cannot be blind to China’s shrewd geopolitical ambitions to bolster influence across the Korean Peninsula. But a leader sometimes must take bold steps and risks if a deal would benefit the country’s national interests and future in a broader and longer context.

A diplomat once said that alliances with other states should be instrumental in magnifying national interests. A leader should not fear taking on the challenge if he or she has a firm philosophy and vision.

*The writer is the Beijing correspondent of the JoongAng Ilbo.

By Chang Se-jeong
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