MA ADMINISTRATION CONTINUES TO WITHSTAND BEEF

C O N F I D E N T I A L AIT TAIPEI 001270 STATE FOR EAP/TC STATE PASS USTR FOR STRATFORD AND ALTBACH, TREASURY FOR OASIA/WINSHIP AND PISA, NSC FOR LOI, COMMERCE FOR 4431/ITA/MAC/AP/OPB/TAIWAN,USDA FOR FAS/OSTA BLUM, BEAN, AND DAWSON; FAS/OCRA RADLER AND POOL; FAS/OFSO SALLYARDS; APHIS/IS AND VS; AND FSIS/HARRIES E.O. 12958: DECL: 10/28/2019 TAGS: ECON ETRD PGOV PREL EAGR TW SUBJECT: MA ADMINISTRATION CONTINUES TO WITHSTAND BEEF CRITICISM Classified By: Bill Stanton, AIT Director, for reasons 1.4 (b) and (d). ¶1. (C) SUMMARY: On October 29, Premier Wu Den-yih was quoted as stating that Taiwan would reject applications to import U.S. beef offal and ground beef. Editorials in major newspapers remained critical of the beef protocol. The Minister of Health fielded legislators' questions at the Legislative Yuan (LY),stressing the administration's intention to enforce food safety and inspection measures for beef. In coming days, the U.S. beef industry plans a new public relations effort to stress the safety of U.S. beef products. Approximately 60 people took part in a peaceful Taipei demonstration against the beef protocol. END SUMMARY. -------------- --- Premier Reportedly Calls for Import Restrictions -------------- --- ¶2. (SBU) According to media reports, Premier Wu Den-yi today was quoted as saying that "U.S. ground beef and offal will not be seen in the Taiwan market. If someone applies to import the said U.S. beef products, the Department of Health will review the application based on relevant regulations and 'deny the application.'" -------------- Editorials Oppose Beef Deal -------------- ¶3. (SBU) On October 29, editorials and op-ed pieces in Taiwan's major Chinese-language and English-language dailies continued to lash out at the Ma administration's decision to enhance market access for U.S. beef. Six editorials lambasted the Ma administration for failing to protect Taiwan's interests and listen to Taiwan public opinion. In general, although beef remained a major story in the October 29 Taiwan media, the issue somewhat retreated from the limelight in the face of fresh scandals involving Taiwan's professional baseball league. -------------- Peaceful Protest at the Executive Yuan -------------- ¶4. (SBU) This morning, approximately 60 protesters held a peaceful demonstration at the Executive Yuan. The protesters, primarily elderly and female, held signs criticizing President Ma as incompetent and calling on Taiwan to renegotiate the beef protocol with the United States. There were no other reports of demonstrations on October 29. The protest was reportedly organized by Tainan city councilman Wang Ding-yu of the DPP. -------------- Ministers Respond to Legislators' Questions -------------- ¶5. (SBU) This afternoon, Minister of Health Yaung Chih-liang, Vice Minister of Economic Affairs Francis Liang, and other senior officials appeared at the LY to take questions from legislators. In general, KMT legislators tried to support Yaung, who said he had never been asked to report to the LY on the progress of beef negotations with the U.S. Yaung reiterated DOH's intention to implement safety and inspection measures for U.S. beef imports. Legislators also raised questions about liability should Taiwan consumers contract BSE from eating U.S. beef. -------------- -------------- Legislators Propose Restriction and Inspection Measures -------------- -------------- ¶6. (C) A contact at the Legislative Yuan (LY) confirmed that KMT legislator Hwang Yih-jiau is developing a proposal to ban the import of U.S. beef offal and ground beef by amending the existing food sanitation law. Legislators are also reportedly considering a non-binding proposal recommending that Department of Health (DOH) inspectors be stationed at companies that handle U.S. beef imports. -------------- Beef Industry Public Relations Effort -------------- ¶7. (C) Over the next several days, the U.S. Meat Export Federation's local office plans to place the October 22 U.S. beef industry letter to Secretary Vilsack, as well as industry statements and factual information on U.S. beef safety, in selected Taiwan media. The material will also include an item on the safety of U.S. ground beef. AIT is checking to see how a series of positive statements made this week by three Taiwan experts, all now serving on the Department of Health's BSE Risk Advisory Committee, might be incorporated into this material. -------------- -------------- Liability Insurance Program Expanded to All Products -------------- -------------- ¶8. (C) The office of a U.S. meat packer told us it was contacted by a major Taiwan food retailer for proof of product liability insurance covering future purchases of the packer's meat products. Specifically, the packer was asked to provide an insurance certificate that had not been required in the past. DOH included a reference to this program in the document used by Minister of Health Yaung when briefing the LY on the U.S. beef protocol earlier this week. According to media reports, the Premier has referred to the program as one of the steps Taiwan authorities would take to safeguard consumer health after expanding U.S. beef market access. Taiwan first announced the product liability program in 2007, and it has since been implemented in four stages for selected categories of food products. Trade contacts, however, indicated that the program has been neither strictly enforced nor respected by industry. AIT has obtained a copy of the original 2007 program, available only in Mandarin, and will report details separately. The new requirements, however, appear consistent with the implementation timeline DOH announced in 2007. -------------- Beef Retailer Reports Strong Sales -------------- ¶9. (SBU) Stephen Wang, General Manager of Kaohsiung's Costco, told AIT/K that October sales of U.S. beef are up by 44.9% from the same period last year, but have dropped by 4-5% in the wake of this week's announcement of the U.S.-Taiwan beef protocol. According to Wang, Kaohsiung Costco was the only major wholesaler and retailer of U.S. beef products in southern Taiwan. He said 30% of his U.S. beef sales were to hotels, restaurants, and food vendors. U.S. beef sales were likely to continue to increase after the beef protocol further opens Taiwan's market, Wang predicted. ¶10. (C) COMMENT: Although the Ma administration appears to be weathering the storm over the beef protocol, we are disturbed by signs that senior EY and LY officials may be promising to implement measures inconsistent with the agreement. We have privately relayed U.S. concerns that Taiwan uphold the protocol as negotiated. END COMMENT. STANTON