Taiwan and the mainland are expected to sign the Economic Cooperation Framework Agreement (ECFA) when Taiwan’s top negotiator Chiang Pin-kung meets his mainland counterpart Chen Yunlin in Chongqing from June 28 to 30. This will be the fifth meeting between the two since Taiwanese President Ma Ying-jeou took office in 2008. 539 industrial items from Taiwan are expected to be allowed preferential tariffs under the agreement, covering industries ranging from petrochemicals to car parts worth USD13.8 billion. Mainland companies will receive advantages on 267 products in the Taiwan market, worth USD2.86 billion. The value of the products accounted for about 10% of Taiwan’s total imports from the mainland last year. Under the agreement, Taiwanese companies will receive tariff benefits on the mainland similar to those received by Southeast Asian countries under a trade pact that went into effect earlier this year. The two sides also worked out provisions protecting intellectual property rights and regulating cross-strait banking. Further negotiations on commodity trade and service trade pacts will be held six months after the signing of the ECFA agreement.

Both sides will also agree to open markets for some non-financial services, with the mainland opening up accounting, auditing, hospitals and aircraft maintenance and repair, and Taiwan removing restrictions on research and development (R&D), conferences and exhibitions, and computer bookings for air transport services. On the financial services front, the mainland will allow Taiwanese banks to operate yuan currency services, including financing, for solely mainland-based Taiwanese firms, but Taiwan will only allow mainland banks to set up offices that could become branches after a year. The mainland will let Taiwanese insurance firms apply to enter the mainland market, based on current criteria applying to foreign firms, and will also allow Taiwanese securities professionals to get accreditation for practicing on the mainland.