Taiwan rejects referendum petition on China trade deal

The deal would slash import tariffs and open the banking sector, bringing the export-reliant island and economic powerhouse China closer together.

Taiwan rejects referendum petition on China trade deal

Taiwan officials said on Friday they had rejected a petition to put a free trade-style deal with China before the island's voters, removing a key hurdle to the landmark agreement that is on track to be signed this year.

The cabinet killed the opposition Democratic Progressive Party's (DPP) application to ask voters whether they wanted an economic cooperation framework agreement (ECFA) with Taiwan's political rival China, the party said.

The deal would slash import tariffs and open the banking sector, bringing the export-reliant island and economic powerhouse China closer together.

As many in Taiwan fear a deal would flood the island with products from the much larger China, the referendum stood a chance of returning a "no" vote, analysts said.

Some voters also worry that ECFA would lead to a political tie-up between the historic rivals.

China has claimed sovereignty over self-ruled Taiwan since 1949, when Mao Zedong's forces won the Chinese civil war and Chiang Kai-shek's KMT fled to the island. Beijing has vowed to bring Taiwan under its rule, by force if necessary.

Since taking office in May 2008, China-friendly Taiwan President Ma Ying-jeou has eased tension with Beijing by brokering negotiations on trade deals. Talks on ECFA have begun, and Taiwan hopes to sign the deal in the first half of the year.

Taiwan's stock and currency markets as well as shares in listed companies from China's Fujian province near Taiwan are expected to gain if the deal is signed.

The referendum petition, despite having massed the required 80,000 signatures, was turned down because ECFA does not yet exist, the cabinet said in its response to the party.

"With unclear specific contents, it's impossible to express support or opposition," the cabinet statement said.

The opposition DPP said voters should still have a right to decide.

"We think referenda are a basic right for a democratic country," said DPP spokesman Tsai Chi-chang. "The people should have more rights to approve or reject government action."


Reuters

Last Mod: 26 Şubat 2010, 14:44
Add Comment