Taiwan's overtures toward Turkey
The lackluster interest in boosting Turkey's relations with Taiwan arose mainly out of a miscalculation on the part of Ankara, already overly cautious about receiving a negative reaction from mainland China, in failing to see the immense benefits this 23 million-strong nation, whose adjusted purchasing power is leaps ahead of many advanced countries, including Japan, South Korea, France, Italy and the United Kingdom.

Otherwise, how can we explain why Turkey, with its ambition to become one of world's top 10 economies in a decade, has largely remained indifferent to a country with the title of the world's 17th-largest exporter and 18th-largest importer according to World Trade Organization (WTO) figures for 2012?

There have been some encouraging indications recently that things will change for the better, given that the Taipei government has started to aggressively pursue stronger economic and commercial links with Turkey. Officials working in the trade and economy ministries of the Turkish government seem to have realized the benefits of partnering with Taiwan to complement Turkish business initiatives, despite the existence of an ultra-orthodox mindset in the foreign policy establishment, with a manifestly ill-advised approach toward Taiwan. It simply does not make any sense for Ankara to stay at a distance from Taiwan when developing commercial and trade links, when in fact the latter has already boosted its economic ties with mainland China in an unprecedented manner in recent years.

The trade volume between the two countries is a meager figure, a little over $2 billion according to Turkish government data for the last year. Given the size of the Turkish and Taiwanese economies, 16th and 20th respectively in terms of Gross Domestic Product (GDP), by the International Monetary Fund's (IMF) 2013 figures, this trade volume is almost negligible. The same poor performance can also be seen in investment figures, tourism and cultural, educational, media and artistic exchanges. Hopefully, these figures will improve for the better, and sooner rather than later. Having had a series of talks with Taiwanese officials this week, I realized that the Taipei government has taken notice of Turkey's emerging economy -- which weathered the 2008 and 2011 external shocks relatively well -- especially after the trade-dependent Taiwanese economy felt the brunt of both the US financial crisis and the ensuing sovereign debt crisis in the eurozone. The reciprocal response from Ankara, however, seemed to have come in late after the increasing Taiwanese overtures.

Perhaps one can take comfort in knowing that it is better late than never in becoming closely engaged with Taiwan, a country that has promising prospects for contributing to the growth of the Turkish economy while producing benefits for itself as well. The Taiwan External Trade Development Council (TAITRA) has already chosen Turkey as a strategic investment partner for critical long-term investment, because the nation's future is more promising than that of European countries, an indication that Taipei sees Turkey as one of the top target markets for Taiwanese companies.

Reflecting on her recent trade mission to Turkey, Cynthia Kiang, deputy director general of the Foreign Trade Bureau of Taiwan's Ministry of Economic Affairs, told me in Taipei that Taiwan is keen to develop commercial and trade ties with Turkey in several strategic industries. If Turkey is serious in its ambition to become one of the leading economies of the world in the medium term, there is no doubt that it has to provide its industrial manufacturing base with more know-how, technology and innovation. Ankara should take Kiang up on her offer, because Taiwan, with an impressive pool of scientists, researchers and promising ICT technologies, might contribute to Turkish industry's acquirement of that groundbreaking technology in some industries.

Turkey can return the favor by playing some role in helping Taiwan compensate for its mainland relations with a crucial diversification policy that targets market penetration for Taiwanese companies in other nations. China is Taiwan's largest trading partner, accounting for some 40 percent of Taiwanese exports, and 70 percent of its total foreign investment has originated from Taiwan in the last five years. Considering that the cross-strait service trade agreement, signed in June of 2013, will liberalize the trade in services between China and Taiwan by opening up 64 industries after its ratification, the Taipei government needs to reach out to other trading partners in order not to be over-dependent on the Chinese market for economic survival. After all, the unstable Chinese market could really shake Taiwan when it swings for the worse.

Taiwan can surely tap into not only the burgeoning Turkish economy, with 77 million consumers with growing personal income, but also raise its profile in third countries' markets where Turkish companies are relatively well-experienced and long-established. I was told that Taiwan is keen to venture into Central Asian and African markets, using Turkey as a gateway, and officials in the Taipei government have already offered the Turkish side a proposal detailing the huge potential of joint ventures in these not-so-saturated markets. In return, Turkey was told it could make use of Taiwan to penetrate into the Chinese-speaking world, because nobody knows this huge market, including mainland China, better than the business-savvy Taiwanese companies.

During my stay, I was also encouraged to see that there is a small yet very active and well-established Turkish community in Taiwan, which acts as a conduit between the two countries in non-governmental links. They seem to have adjusted well to the political, economic and social climate, which is not so different from Turkey, as both have a functioning democracy despite some domestic challenges, including judicial woes, corruption and polarization. East Asian culture seemed to have allowed them to integrate relatively easy into the wider Taiwanese society, as Turks have established cultural centers, business associations and schools to contribute to the communities in which they work and live.

Taiwan is eyeing several agreements with Turkey to boost their business ties without drawing the ire of China, which seems increasingly comfortable with Taipei's overtures on the business front, given the thaw in cross-strait relations. One is an air services agreement that will pave the way for the launching of direct flights between İstanbul and Taipei. Others are the agreement on the avoidance of double taxation and the mutual promotion and protection of investments. If these agreements are signed and ratified, then success stories such as Taiwanese investment companies such as TECO Electric and Machinery -- a Taiwanese conglomerate active in electric motors, appliances and other industries -- and the Foxconn Technology Group will multiply.

Turkey, one of the top tourist destination for European and Russian tourists, can also receive a sizable share from some 10 million travelling Taiwanese citizens. Turkey's offering of an easy e-visa application for Taiwanese visitors has already helped double the number of Taiwanese tourists coming to Turkey in a year from roughly 15,000 to 30,000. The lifting of visas altogether, coupled with a direct air link that cuts flight time by five hours at least, will further boost that figure, many Taiwanese officials say.

The ultimate aim for Taiwan is a free trade agreement (FTA) with Turkey to better link the two economically and commercially. As World Trade Organization (WTO) talks to liberalize worldwide trade have failed, paving the way for the launching of a number of regional free trade agreements, Taiwanese officials have scrambled to catch up in order not to be isolated and prevent its exporters from becoming less competitive. They have signed an FTA with New Zealand and Singapore as they continue to negotiate with mainland China on follow-up treaties to the 2010 Economic Cooperation Framework Agreement (ECFA). It is very clear that the Taipei government has recalibrated its public diplomacy campaign to become more visible in international organizations.

How should China feel about Taiwan's engagement with Turkey? I believe it would be a wise policy for Beijing not to overreact to Taiwan's overtures towards Turkey and other countries, given that many in Taiwan still harbor suspicions about the growing relations with China and think that they might endanger Taiwan's national security. The lingering concern is that Beijing might flex its muscle and decide to leverage its economic ties as political pressure in order to sway the Taipei government in a specific direction. The occupation of the legislature by Taiwanese students protesting the government's recent deal with Beijing to open Taiwan's services industries to Chinese competition and investment, dubbed the Sunflower Movement, may be a harbinger of a deepening divide in an already-polarized Taiwanese society. Thus China should navigate very carefully and not overreact, in order to avoid making things worse for the Taipei government.

Turkey's fundamental interests require that Ankara pursue an engagement policy with both countries and ramp up efforts to boost economic, political and cultural ties with both Beijing and Taipei. This does not have to be a zero-sum game, and neither Beijing nor Taipei should feel uneasy with further Turkish engagement in the Southeast Asian region.

Last Modified: 2014-05-31 09:00:02
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