A Study on the Potential Economic Impact of the Chinese Mainland's Investigation of Trade Barriers on Taiwan in the Context of the RCEP
For a considerable period,Taiwan has imposed discriminatory import restrictions on Chinese mainland products.On April 12,2023,the Ministry of Commerce initiated an investigation into trade barriers concerning this matter.In this study,given the level of bilateral trade dependence across the Taiwan Strait,a product portfolio for Chinese mainland's trade countermeasures a-gainst Taiwan is selected,categorized into three levels of intensity:low,medium,and high.The Global Trade Analysis Project(GTAP)is employed to simulate the impact on the cross-Strait economy under ten different scenarios,encompassing the effects of Chinese mainland's trade barrier countermeasures,the influence of the Regional Comprehensive Economic Partnership(RCEP),and potential response measures from the Taiwan authorities.The research findings are as follows:(I)Fruit and vegetable prod-ucts,aquatic products,beverages and wine,processed foods,textiles and steel products are identified as a feasible product portfolio for Chinese mainland's trade countermeasures against Taiwan.(2)If the Chinese mainland implements import restrictions as coun-termeasures,it will severely impact Taiwan's textile industry,leading to a 23.6％decline in employment.Additionally,Taiwan's export of agricultural products will also be greatly affected,with a 31.4％and 47.3％decrease in the export value of aquatic prod-ucts and fruit and vegetable products,respectively,exerting a more significant impact on counties and cities in the pan-green politi-cal camp.(3)The implementation of the RCEP will amplify the positive impact of countermeasures on the Chinese mainland while mitigating the negative impact,whereas the opposite effect is observed for Taiwan.(4)Regarding the response to trade barrier in-vestigations,it is concluded that for both the Chinese mainland and Taiwan,it is more advantageous for Taiwan to lift import restric-tions on the Chinese mainland rather than joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership(CPTPP).Therefore,it is recommended that cross-Strait trade interactions move towards normative practices.Joining the RCEP based on the common political foundation of the"1992 Consensus"is an effective approach for Taiwan to address trade barrier inves-tigations.Additionally,Taiwan should leverage the Fujian New Road initiative to actively promote high-quality integration between the two sides of the Taiwan Strait.
investigation of trade barriersTaiwanRCEPGTAPpotential economic impact
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