International Seminar: Promoting Supply Chain Resilience—the Thinking and Strategies for the CPTPP

1.    Background

On October 2, 2024, Taiwan WTO & RTA Center of Chung-hua Institution for Economic Research (CIER) held a one-day seminar on “International Seminar: Promoting Supply Chain Resilience—the Thinking and Strategies for the CPTPP” in an attempt to reinforce the crucial role of the CPTPP in the current international community.

In retrospect, two sessions are included in the seminar along with an informative keynote speech and a round table discussion. The issues that firstly address the significance of the CPTPP for members in the current geopolitical landscape and secondly delve into the CPTPP’s expansion to existing and potential members under the changing international economic and trade situation are widely covered.

2.    Taiwan’s Path to the CPTPP: Thinking and Strategies for the CPTPP

For the keynote speech, Jen-Ni Yang, Minister and Chief Trade Representative at Executive Yuan, articulates Taiwan’s accession to CPTPP is necessary since the challenges are sweeping and encroaching on the imperatives of global trade and economic security as well as supply chain resilience. To mitigate the potential fallouts, it is worth realizing that CPTPP should emerge as an efficient framework in an aim to bolster Taiwan’s position in the international arena. The following are the key points outlined from the speech:

• From an economic perspective, the CPTPP represents a significant market, characterized by a combined GDP of approximately US$15.4 trillion—accounting for nearly 15% of global output.

• The exclusion of Taiwan from this bloc would severely restrict our ability to adapt to changing global dynamics and enhance our competitiveness. It would also constitute a missed opportunity for CPTPP member countries to leverage Taiwan’s unique strengths, including its technological advancements and robust industrial capabilities.

• Taiwan envisions itself as a trusted trading partner having maintained a clean record and never been involved in trade litigation or investment arbitration. This commitment underscores Taiwan’s readiness to contribute positively to the CPTPP framework.

• Taiwan is positioned to play a crucial role as a facilitator of supply chain resilience within the CPTPP with its robust industrial ecosystem and stable technological supply chains. Given this, Taiwan is able to offer mutual opportunities for near-shoring and friend-shoring, beefing up supply chain stability and security among member nations.

• Taiwan is also determined to collaborate with CPTPP members on essential themes, such as the green economy, inclusive growth, and digital transformation. It is surely indispensable to maintain the balance between promoting regional trade and ensuring sustainability.

• Regarding digital transformation, Taiwan stands as a competitive supplier of information and communication technology (ICT). We are committed to promoting trustworthy data flow and safeguarding digital governance, thus contributing to the robust digital economy the CPTPP seeks to foster.

3.    In response to international geopolitics, the significance of the CPTPP to the development and resilience of various countries around the world

Moderated by Dr. Connie G.H. Yang from National Chengchi University, the session one eyes on thinking over the pros and cons for members after participating in the CPTPP and the significance of the CPTPP in the current geopolitical landscape. Experts from Canada, Peru, Japan and Taiwan unveil each country’s perspectives and positions in depth and detail. The following are the key points outlined from the panel:

• The CPTPP is characterized as a high-quality trade agreement, often requiring considerable time to finalize negotiations among its diverse members. Yet, the rewards it offers are significant, including increased market access, diversification, enhanced competitiveness, increased FDI, and bolstered regulatory power.

• The CPTPP is significant for Peru for it strengthens relationships with established partners like Japan, Australia, Malaysia and etc. Besides, Peru is attracting investments from all CPTPP member countries. A notable example is the Chancay Port, a joint private investment by Chinese and Peruvian companies. This new infrastructure represents a compelling investment opportunity for Taiwan, as it significantly reduces shipping times to Asia and enhances trade efficiency.

• The CPTPP has played a vital role in alleviating the impact of inflation on Japanese consumers and, meanwhile. facilitating improvements in investment and government procurement by relaxing regulatory frameworks. Through the liberalization, a more favorable environment for cross-border investments is formed, which constantly help spur economic growth across member countries.

• Given the CPTPP, more promising opportunities for collaboration between Taiwan and Australia are extended, including education, biosciences, and semiconductors. By focusing on two sides' complementary strengths and exploring new avenues for cooperation, both nations can leverage their unique advantages to foster economic growth and innovation.

4.    The significance of the CPTPP’s continued expansion to existing and potential members under the changing international economic and trade situation

In the session two, the importance of CPTPP's continued expansion and expectations for new members is under heated discussion. As a prospective member, Taiwan’s accession to the CPTPP would either bring benefits or impacts, raising the attention to scrutinize the future path to which this multilateral framework could lead. The following are the key points outlined from the panel:

• The development of global value chains—complex networks that enhance production efficiency—has reshaped how trade operates today. Establishing and participating in these value chains is more consequential than merely assessing trading figures. In this vein, Taiwan's potential membership in the CPTPP should be viewed positively, as it is determined to reinforce its role in global supply chains and to catalyze deeper discussions on important standards, such as digital governance, data protection as well as areas where some current members may lack robust frameworks.

• As Taiwan considers its accession to the CPTPP, several challenges must be navigated. These include the absence of a formal Secretariat, a lengthy list of applicant economies, and the politicization of the accession process, particularly in light of China’s ambitions. The objective should be to select a candidate that adheres to CPTPP principles while avoiding political entanglements.

• To enhance its prospects for membership, Taiwan should remain undeterred, recognizing that each member will focus on one application at a time. Continuous updates regarding Taiwan's compliance with CPTPP standards are essential, along with informal consultations with existing members and their private sectors.

• In recent years, Taiwan's semiconductor industry has become vital, with global high-tech companies relying heavily on Taiwanese chips. Notably, TSMC has bolstered strategic relationships with countries such as the United States, Japan, and Germany, highlighting the importance of international cooperation in this field. Beyond its leading role in the semiconductor industry, Taiwan benefits from a well-integrated ecosystem that includes IC design, packaging, testing, PCBs, and connectors. This comprehensive infrastructure positions Taiwan favorably in the global supply chain landscape.

5.    Conclusions

For the concluding remarks, Dr. Huai-Hsing Yen from Office of Trade Negotiations, Executive Yua specifically mentions three takeaways Firstly, there is growing consensus that the global economy prioritizes supply chain resilience over the efficiency and cost of trade. Secondly, the CPTPP members are reminded that the trade reliance on certain countries should be avoided to secure trade autonomy within the bloc. Lastly, the CPTPP would continue to convey the right message to the international community that the block serves as a value driven membership safeguarding fair markets, governance accountability, and high level environmental and labor standards.