Taipei, Jan. 16 (CNA) The first phase of a trade agreement signed by the United States and China Wednesday will have only a limited impact on Taiwan's economy, according to an initial assessment by the Ministry of Economic Affairs (MOEA).
The bilateral deal, which is being billed as "phase one" of a comprehensive trade agreement, was signed by U.S. President Donald Trump and Chinese Vice Premier Liu He in Washington, dialing down roughly a year and a half of trade hostilities between the world's two largest economies.
On Thursday, however, the MOEA downplayed the deal's potential impact on the domestic economy, noting its limited scale, as well as the significant barriers that remain before a second, more comprehensive phase of the agreement can be reached.
In an interview with CNA, Vice Economics Minister Wang Mei-hua said that in phase one of the deal, a number of U.S. tariffs will remain in place, thus reducing the immediate impact on Taiwanese manufacturers.
Wang also noted the inclusion of intellectual property -- covering patents, copyrights and trade secret protections -- in the first chapter of the agreement, which she said reflected the considerable importance the U.S. places on the issue.
In many cases, Wang said, China will need to make legal changes in order to fulfill these commitments, which could take a fairly long time.
Another example of the potentially long gap before the next phase of the deal is taken up can be seen in China's promise to purchase an additional US$200 billion in U.S. goods by December 2021, according to Wang.
Given this time frame, she said, it is still an open question how much of the phase one agreement China will be able to implement before the U.S. elections in November 2020, or when a phase two agreement might happen.
Regarding the possibility of increased cooperation between American and Chinese high-tech companies under the agreement, Wang said the Taiwanese tech industry's existing strengths and advantages would likely protect it from any adverse effects.
The U.S. and China's phase one trade agreement will be enacted immediately, through partial relief from tariffs between the two countries, while seeking to address a wider range of issues including the U.S. trade deficit, intellectual property protections and currency exchange rates.
In terms of enforcement, the deal mandates the two sides hold consultations to resolve disagreements before reimposing tariffs or other economic penalties.
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