In response to media report that "ECFA to impact agriculture, benefit China to Taiwan's
disadvantage," the Council of Agriculture (COA) said on November 1 the government has repeatedly
reiterated its position on the cross-strait ECFA that the Taiwan market will not further open to
mainland Chinese farm produce and the issue of agricultural market opening has not been included
in ECFA negotiations, therefore signing ECFA will not impact Taiwan's agriculture. Taiwan will
also establish a negotiation mechanism for agricultural intellectual property rights to facilitate
Taiwanese farm produce exports to mainland China and protect local farmers' interests, added the
COA.

  The Council noted that in order to safeguard the development of local agriculture, the
administration under President Ma Ying-jeou has not opened the Taiwan market to additional farm
produce from mainland China since its inauguration in May 2008. Taiwan enjoyed an overall trade
surplus of US$42.57 billion with mainland China in 2008, but had a deficit of US$280 million in
farm produce trade, according to customs statistics. Although Taiwan imported US$720 million worth
of farm produce from mainland China, most of the imported items were lumber, grains and other
agricultural products not produced but needed in Taiwan, so the structure of imports was in
Taiwan's favor.

  The bases on which various sources quantitified the ECFA economic benefits are quite different,
therefore media have to be very cautious when quoting these assessments, said the COA, citing for
example the media report using the assessment by a scholar based on the hypothesis that the
government will lift controls to completely open its market which, of course, will impact Taiwan's
agriculture. Under the precondition that the agricultural sector maintains its status quo and import
controls on the industrial sector are lifted, Taiwan's GDP will grow by 1.72% after signing ECFA
with mainland China, according to an assessment made for the Ministry of Economic Affairs by Chung
Hua Institution for Economic Research.    

  According to "The study report on cross-strait economic cooperation agreement" released by China's
Ministry of Commerce in October 2009, mainland China's exports of such farm produce as grains,
animals and animal products will increase after the signing of ECFA. The COA pointed out that the
ministry has included in its study Taiwan's market opening to farm produce imports, but the
government in Taipei has insisted on its position that not to further increase import items of farm
produce from mainland China, so its Ministry of Commerce has overestimated the effects in
its report.

  As to the 50% growth of Taiwan's aquatic products trade deficit with mainland China, the COA said
that's because mainland aquatic products which had previously entered the Taiwan market through such
illegal channels as smuggling and transactions at sea have been imported through customs since the
Coast Guard Administration reincorced its efforts to stop such irregularities in recent years.
Increased imports of mainland aquatic products reflected the concrete results of government
anti-smuggling efforts. In order to protect the interests of Taiwanese farmers and fishermen, the COA
will continue to coordinate concerned government agencies enhancing the anti-smuggling efforts.

  The COA noted that the government has reiterated many times its principle of "three nos and three
wants" regarding the signing of ECFA, specifically indicating that it "will not add farm produce items
to be imported" from mainland China, and that protection of farmer interests will definitely be a top
government consideration when negotiating for the signing of ECFA in the future.