The Taiwan Trade Gamble

Signing the Economic Cooperation Framework Agreement (ECFA) in late June is a victory for Taiwanese leader Ma's approach to cross-strait relations and for a Taiwan economy that is already very dependent on trade and investment relations with China. In 2008, over 70 percent of outward-bound capital from Taiwan landed across the strait in China.

However, for Taiwan, this is not simply a commercial deal with its largest economic partner. Ma's administration sees the signing of the ECFA, and the larger warming of cross-strait relations it represents, as a way of helping Taiwan engage more with the rest of the world and to increase Taiwan's "international space." Following this hopeful logic, the Ma administration is hoping that the ECFA acts as an opening for other WTO members to start trade negotiations with Taiwan.