Taiwan has a critical role in Asia’s supply chains and its trade with China is expanding rapidly, enhancing the possibility of triangular trade with Europe. This makes the island an important, albeit diplomatically complicated, partner for the EU, with strong potential to develop bilateral trade.
Taiwan’s status as international partner
Considered by China a “renegade” province, and denied UN membership, Taiwan is not recognised as a sovereign state by its main trading partners, including the EU. Despite this, Taiwan has official diplomatic relations with two dozen countries (mainly Pacific, Latin American and African states) and is a member of 32 international organisations. Most notably, it joined the World Trade Organisation in 2002 as Chinese Taipei. In July 2013, Taiwan signed its first full free trade agreement (FTA) with a country with which it has no formal diplomatic ties (New Zealand), paving the way, it hopes, for similar agreements with the EU and US.
Framework for EU-Taiwan relations
The EU has no diplomatic or formal political relations with Taiwan, in line with its “one China” policy (recognition of the government of the People’s Republic of China as the sole legal government of China). However the EU recognises Taiwan as an economic and commercial entity. It has a structured dialogue on commercial issues of common interest, organised in four working groups meeting on a biannual basis, and dealing with issues related to intellectual property rights, technical barriers to trade, pharmaceutical, and sanitary and phytosanitary rules. The European Commission opened a European Economic and Trade Office in Taipei in 2003. For now, it has no plans for FTA negotiations, invoking Taiwan’s unique political status as well as ongoing negotiations with other Asian countries taking up resources.