The United States and Taiwan will establish a new economic dialogue focused on semiconductors, health care, energy and other technology sectors in a sign of stronger ties, a senior US diplomat said on Monday.
A slew of recent visits, agreements, US diplomatic support and military sales to Taipei don’t reflect a change in US policy but rather an “adjustment” in response to increased Chinese aggression, the official said.
“We must act to restore the balance,” David Stilwell, assistant secretary of state for East Asia and the Pacific, said in remarks to the conservative Heritage Foundation think tank. “Looking to Hong Kong, it is clear that Beijing is willing to disregard international obligations to extend its authoritarian system.”
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Beijing’s actions include stepped-up military exercises near Taiwan, efforts to deprive the self-governing island of diplomatic allies and a bid to push it out of international organisations, Stilwell added.
US and Taiwanese officials said that Friday’s announcement of reduced restrictions on American beef and pork imports, a long-standing irritant, paves the way for negotiations on a formal bilateral trade agreement.
Ties between Washington and Taipei have warmed significantly in recent months, in part a mirror image of deteriorating US-China relations. Earlier this month, Health and Human Services Secretary Alex Azar led a delegation to Taipei that was promoted as the highest-level visit by a US cabinet official since 1979.
On other fronts, Taiwan Semiconductor Manufacturing (TSM) announced in May that it would build a US$12 billion chip manufacturing plant in Arizona. Taiwan last week expressed strong support for US-backed efforts to limit China’s role in global 5G telecommunications networks. And in 2018, Congress passed the Taiwan Travel Act, paving the way for more high-level official visits.
Although Taiwan enjoys bipartisan support on Capitol Hill and strong support in the Trump administration, the relationship is not without problems. Some industry analysts question the economic logic of TSM’s Arizona investment, chalking it up in part to politics. And the beef and pork deal took 13 years of wrangling, suggesting that a broader trade deal could be elusive.
It’s hardly reassuring that the State Department is promoting the bilateral trade agreement rather than the US Trade Representative’s Office, which would negotiate it, noted a Taiwan analyst in Washington who declined to be identified given political sensitivities. “Doesn’t that seem really odd?” the analyst said.
Stilwell did not provide further details on the new economic dialogue, even as Taiwan’s huge trade deficit with the United States remains a major irritant.
“I understand that we need to have a more balanced trade relationship,” said Wang Mei-hua, Taiwan’s minister of economic affairs, speaking by video from Taipei. “We have noticed this problem, and we are adopting measures to address it,” she added, citing efforts to buy more US farm products, natural gas and crude oil.
Taiwan is America’s ninth largest trading partner overall and a major buyer of US farm products. US President Donald Trump has been keen to promote agriculture exports, hoping to bolster support in an election year from farmers hit by his tariff war with China.
But the US trade goods deficit was US$23 billion in 2019, up from US$15.3 billion in 2018, and is on target to exceed 2019 figures this year, according to US Census Bureau data.
Wang attributed the mounting trade gap in part to the shifting of supply chains to Taiwan from China, resulting in more direct exports to the US, but said closer economic ties would benefit US geopolitical objectives.
“A more regionally integrated Taiwan further enhances the economic and security of the Indo-Pacific region,” Wang said.
In his remarks, Stilwell sought to walk a fine line, arguing that Washington was only tweaking long-established – and potentially explosive – policies governing US-China-Taiwan issues, including the one-China principle. Adjustments have been made necessary by Beijing’s increasingly brazen actions, he argued.
In recent years, Chinese soldiers have clashed with Indian counterparts on their shared border, detained up to 1 million Uygurs in “employment retraining” camps in Xinjiang, stepped up island building in the disputed South China Sea and tightened its grip over Hong Kong and civic groups on the mainland.
“It’s not just the US versus China. It’s a global position on what we’re seeing out of Beijing,” Stilwell said.
When asked for comment, a Chinese embassy representative in Washington said: “The Taiwan question is the most important and sensitive issue between China and the US. We urge the US side to … prudently and properly handle Taiwan-related issues.”
The Chinese government has mischaracterised US support for Taiwan, Stilwell said. As outlined in two recently declassified cables, Washington will “never” pressure Taiwan to negotiate with Beijing over sovereignty issues, recognises no expiration on US arms sales to Taipei and has not agreed to renegotiate the 1979 Taiwan Relations Act governing US-Taiwan relations, he said.
“It is important to review history like this because Beijing has a history of distorting,” Stilwell added.
More from South China Morning Post:
- Taiwan’s move to ease US beef and pork imports for potential future trade prompts claim of about-face
- Hong Kong steps up maritime patrols amid reports of local activists being intercepted at sea while attempting to flee to Taiwan
This article US moves bolstering Taiwan are meant to ‘restore balance’, US diplomat David Stilwell says first appeared on South China Morning Post