Taiwan Calls on Australia to Restart Free Trade Agreement Talks

May 31, 2021 Updated: May 31, 2021

Taiwan wants the Australian government to resume free trade agreement talks after they were halted several times from pressure by Beijing.

The Director-General of the Brisbane Taipei Economic and Cultural Office (TECO) Edward Tao told The Australian that it would be a good opportunity for the two countries, who have both suffered economic coercion from Beijing.

“Like Australia, we also have experienced economic bullying from China and are fearful about what it will do,” Tao said. “Last year, they stopped our export of pineapples to the mainland.”

Tao said the country, which has the same population as Australia on an island half the size of Tasmania, was the number one buyer of Australian products on a per capita basis.

“Australia runs a very healthy trade surplus with Taiwan of about $9 billion and trade is set to increase over the coming years,” he said, adding that Australia is seen as a safe and friendly investment environment.

Tao said Taiwan is also wary of Beijing’s increasingly aggressive attitude and noted that Xi Jinping, who is a “very different leader” compared to his predecessors, wants to leave behind a legacy.

“We are very aware of the real threat from China and that the situation is getting heated, but we hope that sensible heads prevail,” he said.

Beijing Interference with an Australia-Taiwan FTA

Australia’s official stance currently adheres to Beijing’s “One China” policy, meaning it does not formally recognise Taiwan as a sovereign state nor have official diplomatic relations.

However, in 2016, talks between the then-Turnbull government and Taiwan were put on hold after Beijing exerted pressure to stop the trade agreement. The China-Australia FTA had just been signed a year prior, in 2015.

Former Liberal Senator David Leyonhjelm told The Australian Financial Review in 2017 that during the period Andrew Robb was trade minister, 2013 to 2016, that an FTA with Taiwan, “was in due course.” However, it was never realised by the Turnbull government after the Chinese Foreign Minister Wang Yi reportedly threatened former Australian Foreign Minister Julie Bishop against pursuing an FTA with Taiwan.

“The Chinese government made it clear to me that circumstances had changed between Taiwan and mainland China, and that China would not look favourably on Australia seeking to pursue a free trade agreement with Taiwan, as New Zealand had done some years ago,” Bishop told Fairfax media in 2018.

Tsai Ing-wen
Taiwanese President Tsai Ing-wen delivers a speech during National Day celebrations in front of the Presidential Building in Taipei, Taiwan on Oct. 10, 2020. (Chiang Ying-ying/AP Photo)

Now, Taiwanese diplomats and officials are again calling on Australia to strengthen the ties between the two countries as warnings of war in the Asia-Pacific region become louder.

In December 2020, Taiwan President Tsai Ing-wen expressed her hope to sign an economic cooperation agreement with Australia.

“We welcome our Australian friends to “rediscover” Taiwan, and also encourage Taiwanese to “rediscover” Australia, to promote more bilateral cooperation and exchanges,” Tsai said, according to the official translation. “We also hope that Taiwan and Australia can negotiate and sign an ECA [Economic Cooperation Agreement] and continue to deepen our partnership.”

Taiwanese Foreign Minister Joseph Wu also called for broader relations and stronger ties as Australia has diversified away from China after a year of economic coercion from Beijing.

“Looking at your neighbour, New Zealand, they already have an FTA with Taiwan. They are taking away lots of trade opportunities from Australia,” Wu told the AFR on May 6. “So maybe Australia will think about how to strengthen relations, trade relations with Taiwan, by signing an ECA with Taiwan.”

Taiwan is Australia’s seventh-largest export market and the tenth-largest trading partner overall.

Currently, Australia has or is negotiating for, FTAs with all its top ten trading partners, except Taiwan.