VZCZCXYZ0000
PP RUEHWEB

DE RUEHIN #1444/01 1162312
ZNR UUUUU ZZH
P 262312Z APR 06
FM AIT TAIPEI
TO RUEHRC/USDA FAS WASHDC PRIORITY 2536
RUEHC/SECSTATE WASHDC PRIORITY 9885

UNCLAS AIT TAIPEI 001444 
 
SIPDIS 
 
SENSITIVE 
 
FAS FOR ITP/AAD 
STATE FOR EAP/RSP/TC AND EB/TPP/ABT 
STATE PASS AIT/W 
STATE PASS USTR FOR ERIC ALTBACH 
 
 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAGR ETRD TW
SUBJECT: DIRECTOR'S INTRODUCTORY CALL ON TAIWAN'S AGRICULTURE 
MINISTER RAISE HOPEFUL SIGNALS 
 
REF: TAIPEI 01356 
 
SENSITIVE BUT UNCLASSIFIED 
 
¶1. (SBU) Summary.  During his April 24 introductory call on Taiwan's 
Council of Agriculture (COA) Minister, Mr. Su Chia-chyuan, Director 
Young raised U.S. concerns over Taiwan's sanitary and phytosanitary 
(SPS) import requirements and Taiwan's advocacy of protection for 
so-called sensitive agricultural products.  The two also discussed 
the agriculture proposals mentioned at the Lien-Hu meetings in 
Beijing.  Minister Su showed considerable political savvy and a 
strong commitment to science-based decisions.  On rice imports, 
however, Minister Su reiterated that Taiwan must maintain policies 
that protect this sensitive agricultural crop.  End summary. 
 
¶2.  (SBU) On April 24, Director Young made an introductory call on 
COA Minister Su Jia-chyuan, who took up the COA position in January 
after serving as Minister of the Interior.  The Director and 
Minister Su had a lively and wide-ranging discussion that focused on 
three key issues:  Taiwan's adherence to SPS provisions; Taiwan's 
position on agricultural trade liberalization in the WTO Doha round; 
and, recent proposals to facilitate cross-straits agriculture 
trade. 
 
¶3.  (SBU) On SPS-related import requirements, Minister Su stated in 
precise and clear terms that COA was committed to a science-based 
process to resolve technical SPS issues that impinge on market 
access.  He made the specific point that, under its previous 
leadership, COA opposed the decision to resume imports of U.S. beef. 
 That opposition was inappropriate, Minister Su felt, since the 
authority and expertise for making that decision lay with the 
Department of Health (DOH).  There should be a unified Taiwan 
position on these types of issues.  The Minister noted that Taiwan 
imports a wide variety of agricultural and food products from a 
broad list of countries and must follow science-based principles 
when importing any item from any supplier. 
 
¶4.  (SBU) COMMENT: As the lead agency on the beef issue, DOH adhered 
to a science-based decision making process that favored the 
resumption of trade.  Under its previous leadership, COA attempted 
to undermine both the scientific evidence supporting the U.S. 
position and DOH's authority over the issue.  The bureaucratic 
infighting between COA and DOH helped fuel strong LY and consumer 
group criticism of DOH that ultimately forced the decision up to the 
Presidential office.  Minister Su's statement is a welcome signal 
that COA will support science-based decisions on food safety issues 
handled by DOH, as well as plant and animal health issues under COA 
authority.  END COMMENT. 
 
¶5.  (SBU) Minster Su also made special reference to apple imports 
and reiterated COA's commitment to a science-based resolution of the 
ongoing concern over the codling moth problem.  He stressed that 
these issues, especially cases where Taiwan does not produce a 
competitive product, should not become political.  He also suggested 
that it is in everyone's interest to keep official comments low-key 
and the rhetoric toned down to avoid political interference when 
technical issues arise.  (COMMENT:  This latter point is especially 
welcome since COA chose in the past year to broadly publicize its 
detection of codling moth in U.S. apple shipments and to warn Taiwan 
consumers of the perceived threat to Taiwan, thereby raising the 
political profile of the issue and making it more difficult to reach 
a resolution. END COMMENT.) 
 
¶6.  (SBU) In response, Director Young thanked COA for its April 21 
decision to keep Taiwan's market open to U.S. potatoes following the 
discovery of potato cyst nematode in Idaho.  Taiwan's decision was 
an appropriate response to the limited risk this detection poses and 
stands in stark contrast to Japan's decision to completely ban U.S. 
potatoes. 
 
¶7.  (SBU) Indirectly alluding to Taiwan's protectionist agricultural 
trade position in the WTO, Minister Su noted that COA was under 
considerable pressure from the Legislative Yuan and farmer groups to 
take a stand that protects Taiwan's rice producers.  He said that 
Taiwan authorities have an obligation to ensure the well-being and 
economic livelihood of farmers, especially rice farmers, not least 
because of the traditional support these farmers provide the DPP. 
He noted that Taiwan's market is, in fact, open to rice imports and 
asked for U.S. assistance to finally resolve the outstanding WTO 
rice market access case.  He expressed COA's concern over the 
likelihood of a negative reaction from Egypt to the arrangement 
between Taiwan, Thailand, Australia, and the United States that is 
close to being finalized.  (See reftel for additional details). 
 
¶8.  (SBU) In responding to Director Young's query on the recent 
 
cross-straits agriculture proposals that came out of the Lien-Hu 
meetings in Beijing, Minister Su noted COA has the same attitude 
toward agricultural trade with the PRC as it does toward any market: 
it welcomes market opportunities for Taiwan agricultural products. 
The recent proposals, as well as the ones formulated last year, 
however, are politically motivated, according to Minister Su, and 
will not be economically significant.  Low agricultural prices in 
the PRC will make it difficult for Taiwan products to command the 
kind of premium and provide the higher return that is available in 
markets like the United States or Japan.  Minister Su also expressed 
COA's concern over the unauthorized use of Taiwan trade names that 
cheat the PRC consumer and damage Taiwan companies' trademarks and 
brand names.  Minister Su said that Taiwan had three options to 
address these infringements: using PRC-based lawyers to file legal 
claims; work through the Straits Exchange Foundation; and, utilize 
the WTO.  He acknowledged that the WTO provides the best mechanism 
for Taiwan to protect its trademark and intellectual property 
rights, but noted it was difficult and sensitive to take that 
approach with the PRC over agricultural trade. 
 
¶9.  (SBU) COMMENT:  Minister Su's remarks on adhering to science in 
order to resolve technical SPS issues were essentially the same as 
those offered by his predecessor.  That said, his pointed example of 
the U.S. beef decision, recommendation to maintain a low profile 
when problems arise, and the overall context in which he made his 
remarks suggest that COA may adopt a more pragmatic and reasoned 
approach on the whole SPS discussion.  Indeed, the decision by COA 
on April 21 to maintain access for U.S. potatoes despite the more 
draconian response by other markets may be a positive indicator of a 
new approach. 
 
¶10.  (SBU) The Minister's defense of Taiwan's position on sensitive 
products, notably rice, shows, however, that COA may not be ready to 
make a significant adjustment on major trade policy issues that 
directly affect a key political constituency.  This reluctance means 
that Taiwan's alliance with the G-10 in the WTO Doha round and 
advocacy of market restrictions for sensitive agriculture products 
will likely continue to detract from Taiwan's larger interest to 
secure for itself improved access for non-agricultural manufactured 
products.  It is important that AIT and U.S. agencies continue to 
point out the inconsistencies in Taiwan's WTO position to Taiwan's 
trade and economic entities.  In addition, Minister Su's leadership 
may provide an opportunity for the U.S. to explore with COA various 
policy options that will allow it to meet its economic and social 
welfare objectives for rice farmers, without employing 
trade-distorting policies.  END COMMENT. 
 
YOUNG