Chinese mainland has announced that it will suspend tariff reductions on certain chemicals imported from the Taiwan Province. This decision comes in response to what the mainland perceives as unilateral and discriminatory trade restrictions imposed by Taiwan, which are seen as a violation of the economic pact between the two sides.
The suspension, which will take effect from January 1, 2024, will impact 12 types of chemical products from Taiwan, including propylene and paraxylene. These products will no longer benefit from the preferential tax rates stipulated in the Economic Cooperation Framework Agreement (ECFA), according to a statement from the Customs Tariff Commission of the State Council.
The ECFA is a comprehensive economic pact between the Chinese mainland and Taiwan, designed to lower commercial barriers and facilitate economic cooperation across the Strait. However, the mainland believes that Taiwan’s trade measures, such as bans and restrictions on mainland products, have breached the terms of the ECFA.
In light of these perceived breaches, the commission has decided to suspend the tax reductions on the aforementioned products, as provided for in the pact. The commission has urged Taiwan to take effective measures to remove its trade restrictions against the mainland, signaling a desire for more equitable and cooperative trade relations.