Taiwan exports to mainland booming after ECFA

TAIPEI -- A year after a cross-Strait economic pact was secured, Taiwan's exports to the Chinese mainland are booming and the island anticipates follow-up trade and investment agreements.

According to latest figures issued by Taiwan's customs authority, exports from the island to the mainland in the first five months reached $51.32 billion, rising 11.66 percent year-on-year.

The Economic Cooperation Framework Agreement (ECFA), which took effect in September 2010, has been hailed as a milestone for realizing the normalization, institutionalization and liberalization of cross-Strait economic relations.

Under the "early harvest program" of the ECFA, which was implemented on January 1, the Chinese mainland has reduced tariffs on 539 Taiwanese goods while Taiwan dropped the duties on 267 mainland goods. Within two years, the duties on these products will be reduced to zero.

The export of commodities in the list of tariff cuts from Taiwan to the mainland, reached $8.62 billion from January to May, up 16.37 percent from the same time last year. About $42.77 million of tariffs were cut.

The export of farm produce to the mainland showed a dramatic increase. According to the island's agriculture department, farm exports on the tariff cut list totaled $49.42 million from January to May, 5.26 times higher than the figure for those exports during the same period in 2010.

Digital control machine tools is another competitive export commodity of Taiwan. According to the Taiwan Association of Machinery Industry (TAMI), the island exported $26.68 million worth of digital control horizontal machines, listed in the early harvest program, to the mainland from January to April, up 142 percent from the same time last year.

Benefiting the wider economy, but small firms in particular

Lai Shin-Yuan, head of Taiwan's mainland affairs department, told a press conference Tuesday that Taiwan's economy has benefited from the ECFA and the public generally felt positively about it.

Since the ECFA was signed, Taiwan's unemployment rate had dropped, hitting 4.27 percent in May, which was the lowest level in 33 months.

The average monthly payment from January to April in Taiwan reached NT$52,505 ($1,849) per capita, 18 percent higher than the annual average figure last year.