A pact has been signed between the US and Taiwan, to work out annual economic talks for five years despite objections by China to Washington’s support for Taipei. The MoU for the economic pact was signed on 20th November 2020 after both sides concluded in a monetary dialogue in Washington. Each side agreed that strategic cooperation in the semiconductor industry may be a mutual priority, and can push for further collaboration in supply chains, science and technology, 5G and telecommunications security, and global health.
The dialogue between the two is meant to be held annually but does not count towards a bilateral trade agreement, however a notable important step towards their trade relations. On one hand, they did not have a free trade agreement but Taiwan has recently reduced the trade restrictions on US imports of beef and pork, furthering ways of trade negotiations and improvement of relations.
The agreement is often extended to another five years once the present pact is over, Taiwan’s Secretary of State Joseph Wu said, adding he was confident the MoU would be supported by subsequent U.S. administration. Secretary of State Michael Pompeo launched the Economic Prosperity Partnership Dialogue with Taiwan in an attempt to bolster cooperation. The talks have been under constant negotiations once a proper trade deal comes into effect. Despite the very fact that the US-Taiwan trade deal has bipartisan US support, but President-elect Joe Biden has not publicly announced his intentions for his China policy. He is seen as an advocate of multilateral solutions that might lead to engagements with Beijing, which has raised some concerns in Taiwan
China has frequently signaled its resentment over improving ties between Washington and Taipei. The Chinese sent military airplanes over the median line of Taiwan Strait when Krach visited Taiwan in September, proclaiming it to be a political provocation. The Communist Party of China lays claim on Taiwan but has never actually controlled or ruled it.