Identifier
Created
Classification
Origin
05TAIPEI4480
2005-11-04 09:00:00
CONFIDENTIAL
American Institute Taiwan, Taipei
Cable title:  

TAIWAN BOFT: G10 WANTS TOUGHER AGR PROTECTIONS

Tags:  EAGR ETRD TW WTO 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L TAIPEI 004480 

SIPDIS

STATE FOR EAP/RSP/TC AND EB/MTA, STATE PASS USTR AND AIT/W,
USTR FOR WINELAND AND WINTERS, GENEVA FOR SHARK, USDA FOR
FAS/ITP/MTND AND ITP/MIRELES

E.O. 12958: DECL: 11/04/2015
TAGS: EAGR ETRD TW WTO
SUBJECT: TAIWAN BOFT: G10 WANTS TOUGHER AGR PROTECTIONS

REF: STATE 199861

Classified By: AIT Acting Director David Keegan, reason 1.4 b/d

C O N F I D E N T I A L TAIPEI 004480

SIPDIS

STATE FOR EAP/RSP/TC AND EB/MTA, STATE PASS USTR AND AIT/W,
USTR FOR WINELAND AND WINTERS, GENEVA FOR SHARK, USDA FOR
FAS/ITP/MTND AND ITP/MIRELES

E.O. 12958: DECL: 11/04/2015
TAGS: EAGR ETRD TW WTO
SUBJECT: TAIWAN BOFT: G10 WANTS TOUGHER AGR PROTECTIONS

REF: STATE 199861

Classified By: AIT Acting Director David Keegan, reason 1.4 b/d


1. (C) BOFT Deputy Director of Multilateral Affairs Jack
Hsiao spoke with AIT about Taiwan's response to the US
request for additional pressure on the EU to improve their
agriculture offer at the WTO on November 2. Hsiao
appreciated the US position but noted that Taiwan and the
rest of the G-10 were even more conservative than the EU.
The members of the G-10 have publicly expressed their
dissatisfaction with the US position and the subsequent focus
on the EU response. According to Hsiao the Japanese Deputy
Trade Minister commented publicly that the US is "dreaming"
and suggested a new grouping be created called the "Friends
of Flexibility". Hsiao predicted that the G-10 would have no
choice but to try to veto any US/EU accommodation that did
not take into account the G-10 position.


2. (C) When Econoff asked whether the G-10 might keep a low
profile and let the EU take the heat for the lack of progress
on agricultural reform negotiations, Hsiao said no. If the
G-10 can share the EU's burden it would be much better, he
said. He noted that the Japanese Trade ministry had
volunteered to fly to London for planned US/EU agriculture
discussions on November 7 just to ensure that G-10 views were
taken into account, but to date they had not been invited.
The G-10 members are worried that the Hong Kong Ministerial
will result in a repeat of the July Package, which Hsiao
characterized as a US/EU "consensus" that the G-10 was forced
to join. Hsiao predicted that the G-10 members would not
allow this to happen again.


3. (C) Regarding the U.S. position on non-agricultural
market access (NAMA),Hsiao acknowledged that the Taiwan
position was in line with the U.S.-supported formula on
market opening for manufactured goods, but noted that Taiwan
has products that need flexibility. He suggested that Taiwan
could be given some special leeway as a newly acceded member
or, if that was not possible, that Taiwan might be treated as
a developing country. As a developing country, Taiwan would
have a 10% leeway on cuts in tariffs, he said. He noted that
Taiwan had agreed not to seek developing country status in
accession negotiations but denied that agreement precluded
future treatment as a developing country. In agriculture
trade, countries are still allowed to protect certain
sensitive sectors and products, but in non-agriculture trade
developed countries don't have that option. According to
Hsiao treating Taiwan as a developing country would allow a
slower phase in of agreed commitments. Hsiao also insisted
that Taiwan could not move any faster on market
liberalization than its regional competitors, including South
Korea, Singapore, and Malaysia.


4. (C) Comment: Hsiao's suggestion that Taiwan be treated as
a developing country for the purposes of implementing any
future agreement on NAMA rises from Taiwan's concern that
they pushed the limits of local industry's willingness to
accept tariff cuts in order to join the WTO in 2002. Taiwan
argues that industry needs additional time to adjust to the
competitive pressures from trade liberalization. Demanding
additional liberalization so soon after accession puts Taiwan
companies at a disadvantage, says BOFT. Taiwan has been
pushing without success for special treatment for newly
acceded members, this proposal should be seen as a creative
attempt on the part of BOFT to reach that goal. This is the
first we've heard of the proposal that Taiwan be treated like
a developing country for the purposes of phasing in NAMA
commitments. However, we can't imagine others at Taiwan's
same income level wouldn't want similar treatment, severely
compromising the effectiveness of any future NAMA agreement.
End Comment.
Keegan