China’s chief negotiator Chen Yunlin will put his name under the much-delayed agreement in Taipei on Thursday, providing a legal umbrella for the more than 80,000 Taiwanese businesses operating in China.
Taiwan’s China-friendly government has described the new pact as a milestone, reached two years after the Economic Cooperation Framework Agreement, or ECFA, eased tariff restrictions and gave trade a major boost.
The ECFA was widely characterised as the boldest step yet towards reconciliation.
“The investment protection agreement is of significance as it is the first agreement to be signed after ECFA,” Chen’s Taiwanese counterpart Chiang Pin-kung said at a press conference ahead of the meeting.
Taiwan and China were split in 1949 at the end of a civil war, and remained implacable enemies for decades, even after the island’s businesses started exploring opportunities across the strait.
Growing economic interaction coincided with a political chill from 2000 to 2008 when independence-minded Chen Shui-bian was president of Taiwan, but his successor Ma Ying-jeou has advocated detente with the huge neighbour.
This is the eighth time in four years that Chen and Chiang meet for talks – unthinkable a decade ago in the absence of formal diplomatic ties but which have now become almost routine.
But despite the expanding interdependence – reflected in an estimated Taiwanese investment on the mainland well in excess of $100 billion – many question the merit of pursuing closer links with China.
“Why sign more bilateral agreements with the rascal government in Beijing while China has respected none of the pacts it has already signed?” said Chou Mei-li, a spokeswoman for pro-independence Taiwan Solidarity Union party, reflecting a widely-held view on the island.
She said that a food safety agreement the two sides signed in late 2008 had done Taiwan little good, and had not prevented several people on the island from being sickened by imported Chinese goods.
Even so, once-fierce hostility to closer ties with China may be gradually waning.
The Democratic Progressive Party, Taiwan’s leading opposition party, has said that unlike previous talks it will not mobilise its supporters to take to the streets.
The party last month announced it will set up a China affairs division as a first step towards promoting relations with Beijing following a setback in January presidential elections, which gave Ma another four years in office.
The investment pact to be inked this week, along with a more technical customs pact, has been the subject of significant delays.
Details of the agreement will only be released after it has been signed, but it appears a main stumbling block has been the protections that Taipei had hoped to get for Taiwan’s businessmen living on the mainland, observers said.
“If Beijing makes concessions on the fronts, it could also mean a guarantee of better rights protection for its own people and for foreigners, and that’s something Beijing doesn’t want to see,” said Tung Chen-yuan, a political scientist at National Chengchi University in Taipei.