Evolution Of The Development Of Cross-strait Economic And Trade Relations

This paper concentrates on the development of economic and trade relations across Taiwan Strait. The relations began from 1979, when the Chinese National People's Congress Standing Committee delivered a statement advocating peaceful reunification Taiwan with mainland China. This was the first step to break the political and economical stalemate since 1949. From then on, communications between two sides were accelerating, and the economic-trade relations thus entered into the primary stage. In this stage till 1987, carrying trade, especially through Hong Kong, was the notable characteristic, while direct investment from Taiwan to mainland was secondary.Situation had changed since 1988. During the period of 1988 to 1991, investment from Taiwan to mainland weighed same as carrying trade. Due to the deterioration of economical and investment environment in Taiwan, more and more small-and-middle labor-intensive industries were transferred to mainland, and there came the first wave of Taiwan investment in mainland.The following period started from 1992. In this period, mainstream transference of industries and enterprises from Taiwan to mainland has changed to large-scale and high-tech field. A conspicuous change was that a new type of industrial chain appeared, and productive system in mainland formed vertical streamline. Investment complexion expanded from labor-intensive industrial to capital-and-technology-intensive too, from southern part of mainland toward northern, from eastern coast region toward western inland area.Because of Taiwan authority's "be patient, no hasty" economical policy toward mainland in 1996, trade relationship across-straits stepped into a stage of adjusting and deepening. Despite of hindrance from Taiwan government, Taiwan entrepreneur started another new investment wave in mainland. The bulk majority of this investment "fever" has spread from traditional industries to information and high-tech industries. And industrial distribution between Taiwan and mainland changed from vertical to horizontal. Pushed by investment of Taiwan tycoon, total indirect trade between two sides amounted to new high level continuously. Financial, science-technological and agricultural cooperation also made a giant progress, and "three-links" enjoyed some development too.With the entry to WTO, the trade and economy cooperation entered into an unprecedented phase. On the one hand, rules of WTO would deepen the cooperation across Taiwan strait; on the other hand, some provisions of WTO would provide pleads for Taiwan authority. On the whole, however, the profit incentives will get more and more momentum, and the trend of economic globalization and regionalization will get increasingly apparent. Predictably, trade, investment and other cooperation across Taiwan strait will make inevitably a giant progress.