PanamaTimes

Thursday, Mar 28, 2024

Beijing's new trade restrictions on Taiwan after Pelosi's visit are a drop in the ocean

Beijing's new trade restrictions on Taiwan after Pelosi's visit are a drop in the ocean

Beijing’s new trade blocks against Taiwan affect about 0.04% of their two-way trade, making them more political than economic.

Beijing took action against Taiwan following U.S. House Speaker Nancy Pelosi’s visit to the island earlier this month despite warnings from Beijing. That included suspensions of imports of Taiwanese citrus, frozen fish, sweets and biscuits and exports of natural sands to Taiwan.

Taiwan is a self-ruled democracy, but Beijing considers the island part of its territory and a breakaway province. China says Taiwan has no right to conduct foreign relations and warned for weeks against Pelosi’s visit.


What trade numbers show


Taiwan’s exports to mainland China were worth $113 billion last year and its imports from China amounted to about $82 billion, excluding re-exports and re-imports, according to figures from the Taiwanese trade bureau.

A bulk of that was in electrical machinery, electronic and technological parts, which Beijing has not targeted.

When it comes to Taiwan’s imports from mainland China, more than half of the $82 billion traded in 2021 were electrical machinery, electronic and technological parts as well as nuclear reactors and boilers.

As for Taiwan’s exports to China, 65% of them were also similar goods in electrical machinery, electronic and technological parts.


Drop in the ocean


On the other hand, the volume of trade in areas that Beijing has targeted is relatively small.

Exports of natural sand to Taiwan — which Beijing has targeted — were a drop in the ocean against the above figures. They amounted to about $3.5 million last year, data from the Taiwanese trade bureau showed.

They were also a small trade compared with natural sand exports from Australia and Vietnam, the biggest suppliers of natural sand to Taiwan last year. Together, they supplied about $64 million of the raw material used in construction and other industries, making up 70% of Taiwan’s purchases, according to its trade bureau.

Similarly, the targeted trade of citrus was valued at a relatively small $10 million last year, though mainland China was also Taiwan’s biggest citrus buyer, Taiwan’s trade data showed.

Other targets such as Taiwan’s exports of bread, pastry, cakes and biscuits to mainland China were worth more than $50 million in total last year.

Beijing’s specific suspension of two kinds of frozen fishes, horse mackerel and largehead hairtail, were valued at over $3 million in 2021, according to Taiwan’s trade bureau.

“China’s economic retaliation against Taiwan is a long-standing strategy in its diplomatic playbook. That said, its decision to target relatively low-value trade items reflects the limits of its economic pressure toolbox,” said global trade lead analyst at the Economist Intelligence Unit, Nick Marro.

“It’s already had restrictions on Chinese visitors to Taiwan in place for a few years, which carry more economic significance; the agricultural products now in the headlines are only a fraction of Taiwan’s export basket. And so the headline impact on Taiwan won’t really be noticeable.”


Precedents


Beijing’s trade suspensions against Taiwan are not a new phenomenon.

In previous years, tensions between the two have led to bans on mainland travelers to Taiwan.

Last year, China suspended imports of Taiwanese pineapples, citing quarantine measures over “harmful creatures” that came with the fruit. China was Taiwan’s biggest pineapple buyer up to that point.

Investment bank Natixis said that the recent Chinese trade restrictions focused on “highly replaceable food products” but not the information and communications technology sector in which the two trading partners have the most trade.

The bank also said mainland China will continue to import from Taiwan as long as it needs the goods, similar to what it has done in other trade conflicts such as the one it has with Australia and the United States.

In the China-Australia trade dispute that started in 2020, China restricted the purchase of some goods such as barley and coal but continued to buy iron ore from Australia, a key ingredient for China’s steel production and the bedrock of the countries’ trade.

There may also be other fallouts from the Pelosi visit that could hurt wider regional trade. For example, heightened military drills in the Taiwan Strait may delay shipments, analysts say.

“The shutting down of these transport routes — even temporarily — has consequences not only for Taiwan, but also trade flows tied to Japan and South Korea,” Marro said.

“It’s not just a story for Taiwan and China, but also for their neighbors, as well.”

Analysis by logistics platform Container xChange said any rerouting of shipping lines to avoid military exercises may be problematic for the trading world as it enters peak shipping season.

Container xChange Chief Executive Christian Roeloffs said, however, that supply chains have become far more resilient over the course of the pandemic.

Customer feedback shows any rerouting of vessels away from the Taiwan Strait will add a few days to ship voyages, though Roeloffs does not anticipate a massive hit to logistics costs.

Newsletter

Related Articles

PanamaTimes
0:00
0:00
Close
Apple warns against drying iPhones with rice
In a recent High Court hearing, the U.S. argued that Julian Assange endangered lives by releasing classified information.
Global Law Enforcement Dismantles Lockbit Ransomware Operation
Russian opposition leader Alexey Navalny has died at the Arctic prison colony
The President of Argentina Javier Mile does not fly private, he flies commercial, with the citizens he represents. And they LOVE him for it.
Bitcoin Reaches $50,000 for First Time in Over Two Years
Belo Horizonte: Brazil's Rising Carnival Hotspot for 2024
In El Salvador, the 'Trump of Latin America' stuns the world with a speech slamming woke policing after winning a landslide election
Tucker’s interview with Putin is over 50M views on X within the first 5 hours.
Finnish Airline, Finnair, is voluntarily weighing passengers to better estimate flight cargo weight
President Nayib Bukele has proudly announced El Salvador's remarkable achievement of becoming the safest nation in the Western Hemisphere.
Former Chilean President Sebastian Piñera Dies in Helicopter Crash
This farmer seems to understand science a bit more than the event organizer, Klaus Schwab.
Facebook turns 20: From Mark Zuckerberg's dormitory to a $1trn company
The Coolest Dictator in the World" on the Path to Victory in El Salvador
Macron, France and fake news
Indian-Origin Man 'King' Arrested For Smuggling $16 Million Drugs Into US
Can someone teach Americans that not every person with slanted eyes is Chinese?
Europe's Farmers Feeding the People, Protesting Against Politicians Who Do Nothing for Their Country and Serve Only Themselves at Taxpayers' Expense
Paris Restaurant That Inspired 'Ratatouille' Loses $1.6 Million Worth Of Wine
Brazilian Police Investigate Bolsonaro's Son for Alleged Illegal Spying
Police in Brazil Raid Residence of Bolsonaro Associate Over Allegations of Illegal Spying
Border Dispute Escalates as Texas Governor Vows Increased Razor Wire
OpenAI Enhances ChatGPT-4 Model, Potentially Addressing AI "Laziness" Issue
The NSA finally acknowledges spying on Americans by acquiring sensitive data
Report Reveals Toxic Telegram Group Generating X-Rated AI-Generated Fake Images of Taylor Swift
US Border Patrol States 'No Plans' to Remove Razor Wire Installed in Texas
Bitcoin Experiences Approximately 20% Decline in Value
Klaus Schwab recently appointed himself as the Earth's "trustee of the future."
DeSantis Drops Out, Endorses Trump.
Nikki Haley said former President Trump is "just not at the same level" of mental fitness as he was while president in 2016.
Residents of a southern Mexican town set the government palace on fire in response to the police killing of a young man
Samsung Launches AI-Driven Galaxy S24, Ushering in New Smartphone Era
Judge Questions SEC's Regulatory Overreach in Coinbase Lawsuit
The Ecuador prosecutor who was investigating the television studio attack, has been assassinated.
Is artificial intelligence the solution to cyber security threats?
Vivek Ramaswamy suspends his US election campaign and endorses Trump.
Viral Satire: A Staged Satirical Clip Mistaken as Real Footage from the 2024 World Economic Forum in Davos
The AI Revolution in the Workforce: CEOs at Davos Predict Major Job Cuts in 2024
Ecuador Reports 178 Hostages in Prison Gang Standoff
The Startling Cuban Espionage Case That Has Rattled the US Government
Two Armed Men in Ecuador, Dressed as Batman and The Joker Storm the Streets.
Armed Gang Raids Ecuadorian TV Station Following State of Emergency Declaration
Anti-Democratic Canada: Journalist Arrested for Questioning Canadian Finance Minister on Support of Terrorist Group
Ecuador's 'Most-Wanted' Criminal Vanishes from Prison
Mexican Cartel Supplied Wi-Fi to Locals Under Threat of Fatal Consequences for Non-Compliance
Border Surge Leads to Over 11,000 Migrants Waiting in Northern Mexico
Outsider Candidates Triumph in Latin American Elections
As Argentina Goes to the Polls, Will the Proposal to Replace the Peso with the Dollar Secure Votes?
Fatal Shark Attack Claims Life of Boston Woman Paddleboarding Near Bahamas Resort, According to Police
×