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Challenges for Taiwan

RECENT steps taken by Taiwan to cut tariff barriers on a wide range of US-made products come at a convenient moment for both the United States and Taiwan. Both sides should take even further actions to expand commerce -- while working to defuse many of the political concerns that have recently arisen between the two trading partners. For many, perhaps most, Americans, Taiwan continues to be perceived as the ``other China,'' the ``smaller China.'' The US, it can be recalled, broke diplomatic relations with the island state back in 1979 when it established diplomatic ties with China. The diplomatic break, which eventually involved 120 countries, came as a deep disappointment to Taiwan. Yet, most of those same nations, including the US, continue to trade with Taiwan, which has had one of the boom economies of East Asia in recent years,

with an average annual growth rate of around 10 percent during the 1970s. Last year Taiwan grew at a rate of 12 percent.

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Today, however, Taiwan is experiencing serious economic challenges -- at least, when measured against the high growth rates of the past. Moreover Taiwan, experiencing a series of recent political and business scandals at home, is encountering a new skepticism among members of the US Congress over the importance of the two-way economic relationship. Protectionist sentiments favoring curbs on Taiwanese textile exports are on the upswing, fueled by Taiwan's large overall trade surplus with the US. The surp lus reached around $10 billion last year.

Taiwan is now pledging to open up its markets to more US goods and services. It has undertaken an extensive ``Buy American'' program. As noted, it has slashed tariff barriers on a wide range of American products. And it is stepping up overall trade contacts with the US.

All these steps are important in helping to shore up the US-Taiwanese relationship, and, of course, in helping to bolster Taiwan's sagging economy. By one measurement, Taiwan is at the moment growing at less than the growth rate of the US. If so, this is a remarkable turnabout.

Taiwan's efforts to open up its markets should be welcomed by Americans. At the same time, Taipei would be remiss to ignore the negative effect on the US, especially on the Congress, of what appears to be an increasing pattern of political repression at home and by Taiwan's agents abroad. The latter would include the murder of Henry Liu, a Chinese-American writer in California, and the subsequent implication of the head of Taiwan's military intelligence.

Taiwan is fond of publicly looking upon itself as ``free China.'' But incidents such as the Liu killing do not help further Taiwan's cause within Congress or among Americans generally.

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