Taiwan, Panama sign free trade pact

Taipei, Aug. 22, 2003 (CENS)--President Chen Shui-bian yesterday promised to continue encouraging Taiwan's investment in Panama after signing with visiting Panamanian President Mireya Moscoso a landmark free trade agreement (FTA) to strengthen bilateral trade and economic ties.

Beginning on Jan. 1, 2004, import tariffs on 6,200 Panamanian products (including textiles and beef) will be removed, accounting for about 70% of all products imported into Taiwan from the Central American nation.

A total of 4,610 Taiwan products (including fibers, lathes, and monitors) can be shipped duty free to Panama, constituting 50% of the products Panama currently imports from Taiwan.

President Chen noted that the ROC-Panama FTA is the first agreement of its kind for Taiwan, adding that Taiwan can serve as a gate and a springboard for Central America to enter Asian markets.

He said the economic and trade potentials of Central America are unlimited with and the establishment of the free trade zone in America in 2005, forming the world's third largest trade blocs following the European Union, the Asia-Pacific Economic Cooperation.

Taiwan can play a more active role in the Central American region when the island becomes a formal member of the System of Central America Integration, he said.

Panamanian President Mireya Moscoso noted that the FTA with Taiwan is expected to boost her nation's export volume to US$650 million and import volume to US$600 million. The FTA will substantially enhance the bilateral trade and economic relations to attract foreign investors to Taiwan and Panama with a 95%of tariff reduction on commodities within ten years, she said.

She also expects the pact will help induce accelerated flow of capital to her nation. Taiwan companies have so far invested US$650 million in shipping and harbor facilities in Panama alone.

Taiwan government officials expressed the hope that the FTA with Panama can serve as a catalyst to induce the signing of same pacts with other nations, especially with Taiwan's major trade partners like Singapore, Japan, and the United States.

The FTA agreement with Panama was inked during the fourth summit of the heads of state and governments of the Republic of China, Central American nations and the Dominican Republic in the Caribbean.

Other national leaders participating in the biennial summit meeting included Costa Rican President Abel Pacheco, Nicaraguan President Enrique Bolanos, El Salvador President Francisco Flores, Guatemalan President Alfonso Portillo, Honduran Vice President Jose Alberto Diaz, Belize Prime Minister Said Musa, and Sergio Grullon, secretary general to the president of the Dominican Republic.

Leaders of the nine countries also signed a joint communique to further economic and trade cooperation between Taiwan and the Central American region and to join hands in the global fight against terrorism. The visiting leaders reiterated their support for Taiwan's bid to enter major international bodies, including the United Nations and the World Health Organization (WHO).