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Taipei/Beijing. China is giving Taiwan everything it wants in a landmark trade deal and asking little in return, as it seeks to charm the island with economic sweeteners in its quest for a political deal to end decades of hostility.

But with both sides having very different expectations of what the economic cooperation framework agreement will achieve, coupled with deep-seated military suspicions, quick movement on political talks is unlikely.

China and Taiwan have been ruled separately since defeated Nationalist, or KMT, forces fled to the island at the end of a civil war in 1949. Beijing claims sovereignty over the island, and insists it must eventually be reunified with the mainland.

Ties have improved radically since the China-friendly Taiwan President Ma Ying-jeou won election in 2008, and the deal announced on Thursday is the most significant and wide-ranging agreement yet between two sides who once stood poised for war.

Beijing is going to lower import tariffs on 539 items versus 267 by Taiwan when the two sides formally sign the deal next Tuesday, giving far fewer economic advantages to Chinese firms.

China appears to care more about helping Taiwan’s export-led $390 billion economy, hard hit in the global downturn, and so hopes to impress the island’s staunchly anti-Communist public and keep Ma’s Nationalist Party in power.

The cuts on the Taiwan items are valued at $13.84 billion and those from China $2.86 billion.

Many in Taiwan still fear Communist China is using the deal to make an unwelcome push for political unification. Some point to Beijing’s comment last month that it would not allow Taiwan to sign free trade deals with major world economies as a worrying sign the island may not get the kind of benefits it is hoping for.


Reuters