DPP: government's free-zone policy was non-transparent, lacking of comprehensive economic planning

The special article governing the Free Economic Pilot Zones (FEPZ) poses several problems because most of the draft contents are empty, as it was described by Chair Tsai Ing-wen during an expanded policy meeting held in Greater Taichung from June 9 to 10. According to Chair Tsai, the arguments surrounding the FEPZ is not just about whether Taiwan is “liberalizing” or “locking itself up”. She emphasized the need to discuss and review whether the government did the right preparations when it conducted the strategy planning for FEPZ.
Nevertheless, the government’s process while planning for the FEPZ was extremely non-transparent. In order to prevent the government from committing policy errors, the DPP chose to stand in defense of deeply-impacted industries, who faced the danger of disintegration without the proper adjustment programs.

Chair Tsai highlighted three major issues the DPP had over the FEPZ policy of this administration: 

1.       The FEPZ policy failed to prove that it had a strategic or competitive edge, but instead, it was seen as an unlimited “Taiwanese sample platter” of free trade zones, agricultural technology parks, export processing zones and science and technology parks. Furthermore, the FEPZ policy didn't resemble the commonly-understood areas of free zone activity, but were designed to be anywhere in a municipality as they gained the approval of authorities. This produced many doubts on the goals of this administration concerning FEPZ and many questions on whether there were boundaries placed for them. Concerns have appeared on the survival of the entire Taiwanese industry, and whether the government made preparations to prevent domestic companies from the danger of falling apart.

2.      The government’s FEPZ policy and concept was not transparent or clear. By eliminating the current administrative controls, there were problems of unclear administrative enforcement, illegal immigration, land acquisition, environmental pollution, all of which were issues that would cause wide public resistance.

3.      The FEPZ policy mapping incorporated controversial industries, for e.g. agricultural and industrial goods originally subject to control. Under the current FEPZ planning, these products, especially agricultural ones, could enter under the pretext of being from the industry allowed for liberalization. The impact created to domestic industries could be greater than the benefits it could bring. For e.g., the liberalization of the medical and higher education industries showed a lack of review on the overall medical and higher education system in Taiwan.

Chair Tsai commented that concerning the FEPZ policy, the DPP must think of the country’s overall economic strategy and propose a broader and more forward-looking proposal. She said, “I believe Taiwan’s response to globalization challenges should be concentrated on efforts to promote and upgrade industrial restructuring, to responsibly shape the right strategy for specific industries and to allocate resources for their development.”