Academia Sinica 1994: EU Trade Policy and Taiwan

Academia Sinica 1994: EU Trade Policy and Taiwan

Abstract

LAURSEN, Finn, "EC Trade Policy, GATT and the ROC"

This paper deals with the trade relations between the European Community (EC) and the Republic of China (ROC) on Taiwan. It gives some historical background, outlines how the EC makes trade policy and traces recent developments in EC-ROC trade. Given the EC's non-recognition of the ROC the question of management of (non)-relations arises. Largely the EC has managed its relations with the ROC through unilateral measures, including autonomously set quotas in the area of textiles and clothing and anti-dumping duties imposed on some ROC products. The national quotas that some member states imposed on some products until recently have now been abolished in connection with the completion of the EC's internal market. The EC has also used a non-governmental organization, Eurochambres, to conclude a couple of agreements with the ROC, and informal policy consultations have taken place. The EC now supports GATT membership of the ROC as long as the ROC accepts all the obligations this entails. ROC membership in GATT, or the new World Trade Organization (WTO) to be established, should allow for further pragmatic improvements in EC-ROC relations.

Table of Contents

Introduction......................................... 4

The EC's Relations with the PRC

and non-relations with the ROC.................... 4

The EC's Common Commercial Policy.................... 10

EC-ROC Trade......................................... 13

The Management of (Non)-Relations.................... 17

Textiles and Clothing................................ 19

EC Anti-Dumping Cases................................ 23

GATT Membership of the Separate Customs

Territory of Taiwan, Penghu, Kinmen and

Matsu ('Chinese Taipei').......................... 33

EC-ROC Relations in the Post-Cold War World.......... 39

Bibliography......................................... 41

Introduction

The purpose of this paper is to give a general overview of trade relations between the European Community (EC) and the Republic of China (ROC). We will outline the main aspects of the EC's Common Commercial Policy and discuss its implications for third countries. We will look at the (non)-relations between the EC and the ROC, and how they seem to be developing at the moment. In terms of substance we will especially study trade in textiles and anti-dumping policy, which have been sensitive areas. Finally, since the ROC bid for GATT membership is one of the current issues and future ROC membership should allow for improved relations between the EC and the ROC, we will explore the issue of GATT membership and the attitude of the EC in this respect.

Since the EC has a Common Commercial Policy we are basically dealing with a bilateral relationship, which depends on decisions on both sides. But the member states play a certain role in EC policy making, so the relationship is a complex one. It is also a relation which is important for both sides, since there is considerable trade between the two. Seen from the ROC the EC is the third trading partner after the United States and Japan. For mere reasons of size the ROC is less important for the EC, but in terms on imports the ROC was the 10th trading partner in 1992, and number 20 in terms of exports.

Dr. Finn Laursen