Singapore and Taiwan may sign a free trade agreement, according to officials from both countries. In an e-mail interview, Sheridan Prasso, an Asia Society associate fellow, discusses the evolution of Taiwan's trade policy.
WPR: What has historically been Taiwan's trade policy?
Sheridan Prasso: For decades, Taiwan was able to sustain a high rate of growth by using its low-wage workforce to turn out consumer goods such as shoes and apparel, and electrical products such as clocks and calculators. Much of this was exported to markets in North America and Europe. "Made in Taiwan" was as ubiquitous in the 1960s-1980s as "Made in China" is today. As Taiwan's manufacturing sector started moving up the value chain, Taiwan made the transition to manufacturing high-tech goods. At the same time, its population grew increasingly middle class. Wages increased and those low-level manufacturing jobs moved elsewhere -- increasingly to China. But Taiwan had been closed to direct trade with the mainland since 1949, and as a result was becoming increasingly economically isolated.