Sunday, May 23, 2010

Taiwan debates trade pact

Weighing the costs in Asian trade talks

International Herald Tribune, May 12, 2010

In a dimly lighted factory off a dusty road in southern Taiwan, Liao Li-hsin, 29, smacks a leather sandal into shape.

He pulls a shoe from a pile, snugly inserts a bright yellow plastic fake foot, and gives the leather straps a few thwacks with a hammer. Then he tosses the sandal on a pile and repeats.

Mr. Liao is one of tens of thousands of workers making shoes in Taiwan, mostly for consumers on the island.

As negotiations move ahead on a Taiwan-China trade deal that could lower tariffs on handmade shoes and hundreds of other products from the mainland, fears are mounting that the island’s traditional industries — like shoemaking — may suffer, even as high-tech, financial services and other sectors gain from freer access to the giant market across the strait.

The government, however, contends that the benefits would far outweigh the costs, and Taiwan’s president, Ma Ying-jeou, hopes to use the agreement to fully normalize economic relations with Beijing while expanding the island’s access to other markets.

“We can handle diplomatic isolation,” Mr. Ma said last month, “but economic isolation is fatal.”

The Economic Cooperation Framework Agreement, the Ma administration says, would be a prelude to similar deals with Malaysia, Singapore and, eventually, Japan or the United States. “Once E.C.F.A. is signed, we want to sign other free trade agreements and try to use mainland China to link with international markets,” a trade official involved in the negotiations, Hsu Chun-fang, said.

In recent years, Taiwan has watched as rivals like South Korea have signed free-trade deals throughout Asia, becoming more competitive in industries like machinery making and pushing their per capita gross domestic product ahead of the island’s.

Taiwan has been hampered in negotiating similar agreements because Beijing views the island as a part of China and objects to other countries’ signing formal treaties that could strengthen Taiwan’s claims to independence. The island has trade deals only with five Latin American countries, which buy a tiny slice of its exports.

The economies of Taiwan and China are already connected. Taiwan has invested $150 billion in China since the early 1990s, according to a Taiwan government estimate. About 40 percent of Taiwan’s exports already go to China, where they face average tariffs of 9 percent. Half of those exports are semifinished goods that are shipped to factories for assembly and other value-added services and then re-exported, according to Mr. Ma.

Yet many of the details remain vague, and that has fueled economic as well as political worries.

The pro-independence opposition says the deal would make Taiwan’s economy too dependent on China and would help conglomerates at the expense of small companies. It is gearing up for protests and is likely to employ stalling tactics in the legislature, where it holds 33 of 113 seats.

The opposition Democratic Progressive Party says the agreement would worsen income inequality and would not create jobs. It says the negotiations lack transparency and that the deal is politically dangerous given China’s goal of unification with Taiwan.

“China is always ambitious when dealing with Taiwan,” said Hsieh Huai-hui, deputy director of international affairs for the opposition party. “So we wonder if sovereignty has been the price for China opening its market for Taiwan.”

Mr. Ma’s government has sought to allay fears by insisting that the deal would not allow mainland workers into Taiwan or remove restrictions on mainland agricultural imports — at least at first. As for shoes, the government says they are not on the list of sectors to see the first tariff cuts.

The government says it will establish a 10-year fund of 95 billion Taiwan dollars ($3 billion) to help traditional businesses compete. Officials have identified 17 industries, including shoemaking, as particularly vulnerable. A special “Made in Taiwan” consumer label has been developed to promote high-quality products made locally.

The government has promoted a study that it sponsored that found that cross-strait trade liberalization could create 260,000 jobs and add 1.65 to 1.72 percent to Taiwan’s G.D.P., depending on the scope of changes.

Economists and research groups affiliated with the opposition dispute that forecast.

In a report on the trade agreement, the Standard Chartered bank did not estimate how the deal would affect the island’s G.D.P. but said it would “boost Taiwan’s long-term growth potential.”

The government said most new jobs would be in sectors like machinery, where exports could increase. Most of Taiwan’s machine products are produced for export, and China buys about 30 percent, followed by Southeast Asia at 15 to 20 percent, according to Wang Cheng-chin, president of the Taiwan Association of Machinery Industry.

But Taiwan’s machinery faces tariffs of about 10 percent in China and 3 to 5 percent in Southeast Asia. South Korea, in contrast, has a trade deal with the 10 members of the Association of Southeast Asian Nations and now exports machines there tariff-free, Mr. Wang said. South Korea and China are studying a trade deal.

The framework agreement would help Taiwan’s machine makers compete, especially with South Korea, though Mr. Wang emphasized that companies needed more than the trade deal. “First, we need good relations with mainland China,” he said. “Then, after signing E.C.F.A., we can talk with Southeast Asia, the E.U. and other countries.”

Petrochemical companies and automakers like Yulon Motor, which has partnerships with Chinese carmakers, could also benefit.

In the financial sector, recent agreements have paved the way for cross-strait mergers and acquisitions. But Taiwan banks want the framework agreement to give them preferential access that could, for example, shorten the waiting time for doing retail business in renminbi on the mainland.

Ms. Hsu, the trade negotiator, said talks had so far focused on issues like rules of origin, dispute settlement and “safeguard” tariffs that could, under some conditions, be slapped on Chinese imports if they were found to be damaging local industries. The list of sectors to see the first tariff cuts was likely to be “very limited,” she said, without giving details.

Past cross-strait agreements have become law after 30 days without legislative debate or a vote. But Ms. Hsu that said because the framework agreement was so wide-ranging and involved tariff cuts, more legislative involvement was required by the Constitution, though the exact process remained to be negotiated.

Though the opposition does not have the votes to block a deal, lawmakers could stall it with filibustering tactics. Taiwan’s legislative speaker often tries to broker compromises on crucial bills out of respect for the minority. One opposition party has proposed a referendum on the agreement; that application is under review.

To drum up public support, the government has begun a media campaign that includes rap videos and advertising. Mr. Ma and the opposition leader, Tsai Ying-wen, tangled over the agreement in a widely watched television debate last month.

Ms. Tsai accused Mr. Ma of recklessly pushing through a deal, saying he was creating a “false sense of urgency” when careful study was needed. The biggest difference between the ruling and opposition parties, she said, was that “we want to face China together with the world,” while Mr. Ma’s party “wants to go through China to deal with the world.”

But most commentators declared Mr. Ma the winner with his upbeat, folksy pitch to the cameras.

Accusing Ms. Tsai of lacking faith in Taiwan companies’ ability to adapt and compete, he asked, “Are we going to choose self-confidence, or are we going to choose fear?”

Original site

Was Gumby Shanghaied?

Has Gumby Been Robbed in Shanghai?

(April 30) -- The Shanghai Expo, the biggest world's fair ever, opened today amidst fireworks and lavish performances from Hong Kong movie star Jackie Chan and Italian tenor Andrea Bocelli.

But as the event's five-month run begins, at least one nagging question remains unanswered: Is the ubiquitous symbol of the extravaganza a straight rip-off of Gumby?

The issue came up amidst uproar at a Shanghai news conference April 23, when a National Public Radio reporter produced pictures that highlighted similarities between the beloved, bendable green American character and the Shanghai Expo's mascot, Haibao.

According to NPR, Expo spokesman Xu Wei responded, "Haibao was unveiled a long time ago. If anyone thinks that their copyright has been violated, that person would already have used legal means to address this by now."

In comments to United Daily News, Haibao's Taiwanese creator Wu Yongjian strongly denied plagiarism, saying he had not seen the Gumby character before conceiving Haibao. He said the accusations were a "huge insult to his integrity" and reputation, and that he would not rule out legal action against anyone making reckless claims.

Gumbygate followed similar charges in the Japanese media that a tune used as an "official" song for the Shanghai Expo was a knock-off of a Japanese pop song, and that the Expo's China Pavilion borrows concepts from a Japanese architect.

Japan's NTV News even tracked down Joe Clokey, the son of Gumby's late creator Art Clokey. "It looks like they were influenced by Gumby, because that's Gumby's eyes, Gumby's shape, and the cowlick, [it's] a little bit like Gumby's hair," the junior Clokey said.

"When people want to use Gumby's shape ... they should just contact us. Gumby could be in China," he said, before joking, "Looks like he already is!"

Chinese blogger Han Han had other concerns. "Haibao makes my head hurt," wrote Han Han, as translated by China Smack. "When everyone saw that he was flat, it raised a big problem for those who were trying to make three-dimensional Haibaos: what should his back look like? Does he have a tail? Does he have a butt? Does he have a butt crack?

"No one knew, so when we saw statues of Haibao in the city, the front sides were all the same, but some Haibaos had backs without cracks, and others had cracks. But recently, because the Haibaos without butt cracks were more numerous, the butt crack has been announced officially as having left China."

See original story for a brief look at how the two cow-licked humanoids stack up.

Taiwan's real-life Sopranos

A Taiwanese godfather known as "Fool-face" goes out in style.

Global Post, May 4, 2010

TAIPEI, Taiwan — They came by the thousands to pay their respects — politicians, Buddhist nuns and hundreds of tough-looking guys in black.

The object of their veneration: Lee "Fool-face" Chao-hsiung, a top godfather of the Taiwanese mob who died in March.

Lee went out in style last week, his body carried to a crematorium in a 108-car convoy of Rolls-Royces, Mercedes-Benzes and Beemers. As a nervous phalanx of police rolled videotape, the cream of Taiwan's underworld filed past, joined by scores of politicians, female models and chanting, robed nuns and monks from the island's top Buddhist groups.

Like their counterparts the world over, Taiwan's gangsters boast colorful nicknames and truck in drugs, gun-running, prostitution, human trafficking, construction firm kickbacks, petty extortion and other racketeering.

But what sets Taiwan's wise guys apart from their Sicilian or Japanese brethren is the extent of their open involvement in political and religious life. No event better highlights that tangled web than a mob funeral like that of "Fool-face."

"Some gangsters aren't so bad, and have close relations with political parties and local religious factions," said Chiu Hei-yuan, a sociologist at Taiwan's Academia Sinica. "That's a part of Taiwan society."

In Taiwan, gangsters don't just "buy" politicians, they become them. About 15 to 20 percent of local township and county councilors and township heads are gangsters, or "heidaoren" (people of the black way) according to Chao Yung-mao, an expert on Taiwan politics and the mob at National Taiwan University.

The numbers are especially large in rural central and southern Taiwan, where traditions and old-boy networks still run strong.

He said about four or five gangsters hold office in the national legislature, and one wise guy even held a powerful county commissioner seat.

Chao dates the mob's big move into politics to the 1980s, when illegal lottery fever swept Taiwan and gangsters were looking to get a cut of the action. "That was a good time to get into politics, so you could host the games and make money," he said.

"Fool-face" didn't hold elective office. Instead, he made a name as a trusted judge of underworld disputes, earning him the moniker "Big Fool-face" in his later years, according to the China Times. He was a top figure in the Tiandaomeng, or Heavenly Way Alliance, a "super-group" of local Taiwanese gangs formed by top mobsters while they were jailed together in a crime sweep, said Chao.

Heavenly Way's underworld competitors are "Mainlander" gangs like the Bamboo Union with roots in the 1940s Kuomintang exodus to Taiwan; that rivalry was the backdrop of a recent hit film "Monga."

Gangsters also have indirect pull on politics, leaving office-holders bound in ties of obligation. They can help mobilize votes, through "vote-buying" or intimidation. That can be important in a close election, said Chin Ko-lin, an expert on Taiwan organized crime at Rutgers University.

"For a politician, what are you going to do, take the risk of losing an election?" said Chin. "And not many people will criticize you for showing up at a gangster's funeral."

The politicians in attendance at Fool-face's farewell included more than 10 legislators, the legislative speaker (who doubled as the head of Fool-face's funeral committee), the local county commissioner, the local city council head and a prominent mayor, according to the China Times. The mayor said he was there to show gratitude for Fool-face's $630,000 gift to the city.

The don also donated large amounts to Buddhist groups, which isn't a surprising development. Gangsters here attempt to influence religious life. One mobster-turned-legislator runs a famous temple in central Taiwan, not far from Fool-face's home turf. Chiu, the sociologist, says he has difficulty explaining to foreign colleagues how local people could accept this. (Imagine a Michael Corleone who doubles as a congressman and also runs a prominent local Catholic church.)

Chiu suspects it has something to do with Taiwan's casual take on religion. "Taiwan folk religion is so secular. It's not sacred," he said. Rural Taiwanese worship a jumble of Taoist, Buddhist and folk figures, and gods who don't answer prayers are promptly kicked to the curb. Temples are rowdy places, with cell phone ring tones mixing with the clacking sound of divination blocks hitting the ground.

Gangsters also have strong support in their home communities, usually poor farming or fishing villages, said National Taiwan University's Chao. They make their money on the sins of the city, while doling out cash, favors and "face" to their loyal and affectionate hometown crowd.

"They take care of their home communities, and only 'hunt' or do something illegal in urban areas," said Chao. "That's why they can win elections."

Chao said gangsters' political reach distorts Taiwan's democracy and hurts society. He cited poor-quality construction and the appointment of gangster cronies to local government posts as just two examples.

But he was hopeful that change is coming, even if slowly, as rural traditions fade.

"Urbanization is a big challenge for the mafia world," said Chao. "Young people don't care as much about 'guanxi' [personal networks of obligation] — they care about a politician's performance. That's a good environment for change."

Just don't tell that to Fool-face.

Original site

Mob funeral captivates Taiwan

Mobster's funeral draws the great and good

AOL News, April 27, 2010

TAIPEI, Taiwan (April 27) -- How big is organized crime in Taiwan? Very big indeed, judging by the attendance at this week's funeral of a top mob boss, which drew prominent politicians, Buddhist monks, TV variety show celebrities and foreign dignitaries.

Gangster Lee Chao-hsiung died last month of liver cancer at the age of 73. The 108-car funeral procession conveying his body to a crematorium Monday included a Rolls-Royce hearse, Mercedes-Benzes and BMWs. Fetching female models carried large signs announcing each delegation in what amounted to the closing ceremony for an Olympian of Asian organized crime.

It was believed to be the island's biggest ever gangster funeral, with more than 20,000 attending and lines of spectators stretching for more than a mile.

"He was the big boss, and it's natural that many gang members want to bid a last farewell to him," said an assistant to a Taiwan legislator quoted by Agence France-Presse.

What was perhaps more remarkable were the other guests. They included the island nation's legislative speaker, who doubled as head of the funeral committee; a prominent mayor; and more than 2,000 chanting Buddhist monks and nuns.

Why all the reverence? Though details of Lee's past were scant, he was known as an arbiter of underworld disputes. He helped negotiate the safe release of several kidnapped politicians, according to AFP.

And then there's the money. He donated just under $2 million to four of the island's main Buddhist groups and to his native city of Taichung, according to the the Apple Daily. Donations at his funeral yielded another $1.6 million for charity, even after deducting $1.2 million to cover the funeral costs. It's not clear to whom or what that money will go, the Apple Daily said.

"Everyone pushed me to lead the funeral committee," Taiwan's legislative speaker told Taiwanese reporters. "I think he has a benevolent heart," said Taichung's mayor of the deceased wise guy.

Gangsters play an ambiguous role in Taiwan society, with many engaging in both criminal activity -- "the black path" in Chinese parlance -- and legitimate business ventures, or "the white path." They are often enlisted to arbitrate business disputes.

"In Taiwan it's not a big deal to be associated with an underworld figure," said Chin Ko-lin, an expert on Asian organized crime at Rutgers University. "In fact, a lot of people are even proud of it."

Gangs have long had close ties with big businesses and politicians, and moved into the construction and entertainment industries in the 1990s. Chin said some Taiwan politicians enlists gangsters' help at election time and attend funerals and other functions to tighten bonds.

"They want the support of the Taiwan underworld," said Chin. "It shows that the whole issue of 'black-gold' [corrupt] politics is going to continue to exist for a long time in Taiwan."

Monday's funeral drew a star-studded cast from Taiwan's underworld, according to the Apple Daily. They included a top figure from the Bamboo Union, Taiwan's largest gang, leading a 500-mobster delegation; the head of the Heavenly Way Alliance with another 500 wise guys; and Four Seas head Chang "Brother-man" Jian-ying, with 300 gangbangers.

Gangsters from Japan's feared yakuza and Hong Kong and Macau triads also made a showing.

Large-scale mob funerals are a regular occurrence in Taiwan and are generally tolerated by police. A 2007 funeral put to rest former Bamboo Union leader Chen Chi-li, who had spent his latter years in a luxury home in Cambodia after serving time in Taiwan for his role in the murder in California of a Taiwanese journalist. One of Taiwan's top pop stars attended that large service.

But Rutgers University's Chin said that Taiwan cops were unhappy with an ostentatious funeral of a top Four Seas gang boss, and since then have worked out funeral guidelines with gangsters.

As a result, youths under 18 were not allowed to attend Monday's funeral. The police detained 148 such kids and called their parents to come get them, according to the Apple Daily.

Original site