Asia-Pacific Features

ANALYSIS: Taiwan's shift on US beef is seeking balance with China

Mar 13, 2012, 12:48 GMT

Taipei - Taiwan President Ma Ying-jeou knew his move to ease a ban on US beef would provoke a backlash.

He waited until after his narrow re-election to announce the plan to lift a ban on US beef containing the growth additive ractopamine.

He issued the press release in the middle of the night, fully aware that a majority of his electorate has health concerns about the additive, which is added to animal feed to increase lean meat yield.

And when angry farmers went to pelt government buildings with pig faeces and rotten eggs on Thursday in protest at the move, they found police in riot gear waiting.

The government said on March 5 it was proposing to lift the ban on beef imports containing ractopamine, which has been banned in all meat products since 2006.

The move, which still faces a three-month approval process by the health ministry and legislature, would institute a labeling policy for the additive, and mainly affect beef from the United States.

Ministers have said the move will help restart trade talks with the US, which stalled over the restrictions.

But another, unspoken reason for the policy change is a shift away from the recent rapprochement with China, experts say, driven by public pressure.

In his first term, Ma improved ties with Beijing, which regards the island as a breakaway province. Stronger economic links allowed China's massive growth to spur Taiwan's recovery after the 2008 global financial crisis. China became Taiwan's largest trading partner, accounting for 40 per cent of all Taiwanese exports in 2011.

But cozying up to China appears to have become a double-edged sword, with Ma's share of the vote slipping nearly 7 percentage points between the 2008 elections and this year's. A 2011 poll by Academia Sinica, Taiwan's top research body, showed 66 percent of Taiwanese oppose reunification with the mainland.

'Ma's Nationalist Party might lose the next election by getting too close to China, because voters will accuse them of selling out Taiwan,' said Chen I-hsin, an international relations specialist at Tamkang University. 'He needs to inject more balance into his economic strategy to keep his party in power.'

As well as a wary electorate, Ma is likely to face more resistance from Beijing in his second term, analysts say. Talks on an investment protection deal for Taiwanese investors have already stalled because China refuses to use arbitration mechanisms that suggest Taiwan is a sovereign entity.

In response, Ma is pivoting his economic policies towards the US, observers say.

Improved relations with Washington would not only be politically expedient, but also bring material benefits of their own.

A lowering of tariffs could make Taiwan's exports to the US more competitive, especially after rival South Korea signed a free trade agreement with Washington in 2011. Taiwan also wants to join the Trans-Pacific Partnership, a regional free trade agreement that is currently being negotiated by the US.

Washington has made it known that its cooperation on these goals depends on Taiwan easing the restrictions on US beef.

William Stanton, the top US envoy in Taiwan, called the issue a 'stumbling block' that has cast doubt on Taiwan's openness to trade, according to the semi-official Central News Agency last week.

Besides trade, the US holds the strings on visa waivers for Taiwanese citizens and on arms sales to boost the island's defence.

'Lifting the ractopamine ban was crucial to improving US relations, which opens the door to the other bilateral wins that Ma wants,' Chen said.

Ma may be hoping that improved US relations will help him win votes in the long run. But in the shorter term, the move has played into the hands of the opposition.

Pig farmers have been the most vocal in their protests, fearing that if the ban is eventually lifted on pork, cheap US pork imports could threaten their livelihoods.

Ma also faces a potential rebellion by members of his own party, whom the plan caught by surprise.

Lo Shu-lei, a Nationalist lawmaker, said Ma has failed so far to communicate the benefits of lifting the ban to his caucus. If the poll was today, most lawmakers would vote no, she said.

'The government hasn't clearly told us whether we would be guaranteed a trade deal (with the US) if we let their beef in,' Lo said. 'So if we are not getting anything, why are we making this compromise?'

To bring his legislators into line, Ma could say that without better US relations, their legislative majority, and their jobs, could be in jeopardy when the next election comes.