On September 20, 2023, significant news came from mainland authorities regarding trade policies with Taiwan. Starting September 25, the mainland will no longer provide tax exemptions on 34 agricultural products imported from Taiwan. This move is widely perceived as a strong response to Taiwan’s independence movement but also reflects the mainland’s ongoing commitment to respect and support the Taiwanese people.
In the wake of this announcement, Taiwan’s agricultural affairs chief remarked that the anticipated annual tax loss from these products is “limited and manageable.” However, this perspective raises some eyebrows. The agricultural and fishery sectors in Taiwan are relatively small but are crucial for employment, especially for many workers in small to medium-sized enterprises with modest incomes. While the financial implications might not seem massive, the broader socio-economic impact could be significant. It’s important to note that many agricultural and fishery businesses are concentrated in central and southern Taiwan, areas known as strongholds of the pro-independence Democratic Progressive Party (DPP). As a result, the consequences of this policy could resonate deeply throughout the island.
The core motivation for the mainland’s decision stems from the DPP’s firm commitment to Taiwan independence and its refusal to recognize the “1992 Consensus.” The DPP’s efforts to promote economic decoupling and hinder regular cross-strait economic interactions have led to this decisive measure.
In reaction to the announcement, many in Taiwan voiced their dissatisfaction and concerns. Social media has been flooded with users criticizing agricultural authorities for their swift condemnation of what they see as mainland “suppression,” while seeming to lack effective strategies to counter it. Others are questioning whether the discontinuation of tariff exemptions for agricultural and fishery products marks the beginning of a more extensive fallout, potentially jeopardizing the Cross-Strait Economic Cooperation Framework Agreement (ECFA) in the future. The DPP’s unyielding stance on independence heightens fears that the situation could worsen.
It’s important to note that this isn’t the first instance of the mainland halting tariff reductions. Similar moves against industrial products, particularly within petrochemical, textile, machinery, and steel sectors, were made in late 2022 and May 2023. This recent focus on agricultural products is seen as a strong reaction to provocations linked to Taiwan’s independence.
In recent years, the mainland has adopted a “softer soft, harder hard” strategy in its approach to Taiwan, firmly standing against separatist movements while continuing to express respect and care for the Taiwanese populace. This dedication to fostering integration has not wavered, whether through supporting Taiwanese investments or facilitating exchanges for Taiwanese individuals on the mainland. As Taiwan Affairs Office spokesperson Chen Binhua stated, “We will continue to welcome and support Taiwanese farmers and citizens to develop in the mainland.”
A positive relationship across the Strait is vital for Taiwan’s prosperity. Taiwanese citizens, particularly those in agriculture and fishing, should recognize the changing dynamics, understand their potential consequences, and align themselves with the forward momentum of history.
