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[Page: E2392]

• Mr. SCHULZE. Mr. Speaker, for years, the Republic of China on Taiwan has been the success story of the developing world. Starting from ground zero in 1949 with a subsistence agricultural economy, it has step-by-step advanced into the ranks of the world's developed nations. A country with minimal natural resources, its leadership recognized early on that international trade was Taiwan's only hope for long-term prosperity. As we all know, they have become masters of the science, now ranking as the 13th largest trading nation in the world. Yet, ironically, Taiwan is not a member of the General Agreement on Tariffs and Trade [GATT], the organization which for all practical purposes sets the rules for international trade. Taiwan wants to participate in the activities of GATT, and also is willing to honor and obey its rules. In fact, for years Taiwan has voluntarily abided by GATT rules, even though it has been denied membership.

• It is time for the United States to formally support Taiwan's application for membership. Its application takes into full account the sensitivities involved in our relationship with the People's Republic of China. There is no logic to denying a seat at the GATT table to Taiwans, America's sixth largest trading partner. Further, there is no logic to the Department of State's argument that the timing of Taiwan's accession to the GATT should be tied to the GATT accession of the People's Republic of China. Clearly, Taiwan was ready years ago for full-fledged membership in the GATT. On the other hand, the People's Republic of China whose repressive human rights practices and obvious disdain for fair trading rules place it in a substandard category, is not ready for nor deserving of GATT membership, and will not be for some time to come. To deny Taiwan its well-deserved seat at the GATT negotiating table solely on the grounds that mainland China has not matured to such a level as to entitle that nation to GATT membership, is totally incomprehensible.

• I call the attention of my colleagues to an insightful op-ed article published in the Christian Science Monitor on March 4, 1991. The article is written by T.Y. Wang, a political science professor at Illinois State University. It examines the question of Taiwan's application to the GATT. No one can question Taiwan's qualifications to be a GATT member, yet its application has repeatedly been stalled. The world's trading nations are awaiting a sign that the Government of the United States supports Taiwan's application. I submit the article, `Taiwan's GATT Membership--Fully Deserved, Yet Elusive,' for the benefit of my colleagues who may not have seen it. At the same time, I urge the administration to give its support to Taiwan's application.

The following are facts about Taiwan's economic achievements: Taiwan is one of the largest trading partners of the US. Taiwan is the 13th-largest trader in the world. Taiwan has the largest foreign-exchange reserves in the world ($70 billion). And Taiwan is one of the most successful `newly industrialized countries.' Still, Taiwan is not a member of the General Agreement on Tariffs and Trade (GATT)--the world's only multilateral trade regime.

Early last year the Taiwanese government submitted an application to join GATT. The application was viewed dimly in the US for political reasons. Washington is afraid of offending the leaders of the People's Republic of China (PRC) by supporting Taiwan's application for GATT membership. Chinese officials maintain that to support Taiwan's application to join GATT is a violation of the `one China' policy. They are especially unwilling to see Taiwan receive a GATT membership before the PRC, whose application has been stalled since the brutal massacre at Tiananmen Square in June, 1989.

The Bush administration's lack of support for Taiwan should be reconsidered.

In order to sidestep the `two Chinas' issue, the Taiwan government has asked for membership in the name of the `Separate Tariff Territories of Taiwan, Penghu, Kinmen and Matsu Islands'--the names of the main islands under the Taiwan government's direct and effective control. Such an application should be seen as an honest effort to avoid `two Chinas.'

Also, Taiwan's application to join GATT is legally justified. There is not doubt Taiwan has a `separate customs territory' over which the government possesses `full autonomy in the conduct of its external commercial relations.' This is consistent with the legal stipulation of Article 33 of GATT's membership application.

Moreover, while Taiwan is not a GATT member, the government in Taiwan has worked hard to liberalize its economy. The national currency has appreciated by about 40 percent against the US dollar since 1987. That decreases the protection on Taiwan's export sectors. Many tariff and non-tariff barriers on foreign goods, such as liquor, agricultural products, and banking services have recently been reduced or eliminated. While more is yet to be done, these efforts should be recognized by the international community.

Finally, Taiwan's GATT membership would be beneficial to the interests of the international community. During the past four decades, Taiwan took advantage of GATT's `special treatment' principle for developing countries and protected its market. With its economic success, many developed countries, including the US, have proposed that Taiwan should no longer enjoy the benefits from the GATT system without sharing the responsibilities. Currently, this has been carried out by bilateral negotiations. If Taiwan were to be admitted to GATT, it would have to abide by GATT regulations and the liberalization of its market would speed up.

Taiwan was a founding member of GATT in 1947. The seat was abandoned by the Nationalist party (Kuomintang or KMT), which was forced to flee to Taiwan before the Chinese Communists took over the mainland. Taiwan was later granted an observer's seat in 1965, but this status was lost in 1971 when the UN General Assembly voted to recognize the PRC as the only legitimate Chinese government. Under GATT rules, Taiwan needs a two-thirds majority to rejoin GATT. Although the US cannot singlehandedly determine the outcome, its support would carry considerable weight among other the members.

[Page: E2393]

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