U.S.-Taiwan Relationship: Overview of Policy Issues

Shirley A. Kan
Specialist in Asian Security Affairs

Wayne M. Morrison
Specialist in Asian Trade and Finance

The purpose and scope of this CRS report is to provide a succinct overview with analysis of the major issues in the U.S. policy on Taiwan. This report will be updated as warranted. Taiwan formally calls itself the sovereign Republic of China (ROC), tracing its political lineage to the ROC set up after the revolution in 1911 in China. The ROC government retreated to Taipei in 1949. The United States recognized the ROC until the end of 1978 and has maintained a nondiplomatic relationship with Taiwan after recognition of the People’s Republic of China (PRC) in Beijing in 1979. The State Department claims an “unofficial” U.S. relationship with Taiwan, despite official contacts that include arms sales. The Taiwan Relations Act (TRA) of 1979, P.L. 96-8, has governed policy in the absence of a diplomatic relationship or a defense treaty. Other key statements that guide policy are the three U.S.-PRC Joint Communiqués of 1972, 1979, and 1982; as well as the “Six Assurances” of 1982. (See also CRS Report RL30341, China/Taiwan: Evolution of the “One China” Policy—Key Statements from Washington, Beijing, and Taipei.)

For decades, Taiwan has been of significant security, economic, and political interest to the United States. In 2012, Taiwan was the 11th-largest U.S. trading partner. Taiwan is a major innovator and producer of information technology (IT) products, many of which are assembled in the PRC by Taiwan-invested firms there. Ties or tension across the Taiwan Strait affect international security (with potential U.S. intervention), the U.S.-Taiwan relationship, and U.S.- PRC cooperation. While the United States does not diplomatically recognize Taiwan, it is in reality an important autonomous actor. Today, 23 countries (including the Vatican) have diplomatic relations with Taiwan as the ROC. Taiwan’s 23 million people enjoy self-governance with democratic elections. After Taiwan’s presidential election in 2008, the United States congratulated Taiwan as a “beacon of democracy.” Democracy has offered Taiwan’s people a greater say in their status, given competing politics about Taiwan’s national identity and priorities. Taiwan held presidential and legislative elections in January 2012. Kuomintang (KMT) President Ma Ying-jeou won re-election against the Democratic Progressive Party’s (DPP) candidate.

Since Taiwan and the PRC resumed their quasi-official dialogue in 2008 under President Ma and cross-strait tension decreased, some have stressed the need to take steps by the United States and by Taiwan to strengthen their relationship to advance U.S. interests. Another approach has viewed closer cross-strait engagement as allowing U.S. attention to shift to expand cooperation with a rising China, which opposes U.S. arms sales and other dealings with Taiwan. In any case, Washington and Taipei have put more efforts into their respective relations with Beijing, while contending that they have pursued a positive, parallel U.S.-Taiwan relationship.

Taiwan’s President Ma Ying-jeou has sought U.S. support for his policies, including Taiwan’s inclusion in the U.S. Visa Waiver Program (VWP) (in 2012), the International Civil Aviation Organization (ICAO), and talks on maritime territorial disputes in the East and South China Seas. Taiwan and the Philippines are concluding parallel investigations into the incident on May 9, when the Coast Guard of the Philippines (a U.S. treaty ally) shot at a Taiwan fishing boat, resulting in the death of a Taiwan fisherman, Taiwan’s sanctions, and bilateral tension. Other policy issues include whether to approve arms sales, restart Cabinet-level visits, and continue trade talks under the Trade and Investment Framework Agreement (TIFA), or TIFA talks (resumed in March 2013). The United States has concerns about Taiwan’s restrictions on U.S. beef and pork, even as Taiwan has claimed attention to international organizations and standards.

Legislation in the 113th Congress includes H.R. 419, H.R. 772, H.R. 1151, H.R. 1960, H.Con.Res. 29, H.Res. 185, S. 12, S. 579, S. 1197, and S.Res. 167. Other congressional actions have focused on arms sales. (See CRS Report RL30957, Taiwan: Major U.S. Arms Sales Since 1990.)


Date of Report: July 2, 2013
Number of Pages: 44
Order Number: R41952
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The Trans-Pacific Partnership Negotiations and Issues for Congress

Ian F. Fergusson, Coordinator
Specialist in International Trade and Finance

William H. Cooper
Specialist in International Trade and Finance

Remy Jurenas
Specialist in Agricultural Policy

Brock R. Williams
Analyst in International Trade and Finance

The Trans-Pacific Partnership (TPP) is a proposed regional free trade agreement (FTA) being negotiated among the United States, Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. On March 15, 2013, Japanese Prime Minister Shinzo Abe announced that Japan would seek to participate in the TPP negotiations. On April 24, 2013, the Obama Administration gave Congress notice of its intent to negotiate with Japan in the TPP, and Japan is expected to participate in the next round of negotiations in late July 2013. U.S. negotiators and others describe and envision the TPP as a “comprehensive and high-standard” FTA that aims to liberalize trade in nearly all goods and services and include commitments beyond those currently established in the World Trade Organization (WTO). The broad outline of an agreement was announced on the sidelines of the Asia-Pacific Economic Cooperation (APEC) ministerial in November 2011, in Honolulu, HI. If concluded as envisioned, the TPP potentially could eliminate tariff and non-tariff barriers to trade and investment among the parties and could serve as a template for a future trade pact among APEC members and potentially other countries. Congress has a direct interest in the negotiations, both through influencing U.S. negotiating positions with the executive branch, and by passing legislation to implement any resulting agreement.

The 17th round of negotiations concluded in Lima, Peru on May 24, 2013, and the 18th round is scheduled to be held in Malaysia July 15th-25th 2013. The current goal is to reach an agreement in time for the October 2013 APEC summit in Indonesia. For this deadline to be achieved, outstanding negotiating positions may need to be tabled soon in order for political decisions to be made. The negotiating dynamic itself is complex: decisions on key market access issues such as dairy, sugar, and textiles and apparel may be dependent on the outcome of controversial rules negotiations such as intellectual property rights or state-owned enterprises.

Twenty-nine chapters in the agreement are under discussion. The United States is negotiating market access for goods, services, and agriculture with countries with which it does not currently have FTAs: Brunei, Japan, Malaysia, New Zealand, and Vietnam. Negotiations are also being conducted on disciplines to intellectual property rights, trade in services, government procurement, investment, rules of origin, competition, labor, and environmental standards and other issues. In many cases, the rules being negotiated are intended to be more rigorous than comparable rules found in the WTO. Some topics, such as state-owned enterprises, regulatory coherence, and supply chain competitiveness, break new ground in FTA negotiations. As the countries that make up the TPP negotiating partners include advanced industrialized, middle income, and developing economies, the TPP, if implemented, may involve substantial restructuring of the economies of some participants.

The TPP serves several strategic goals in U.S. trade policy. First, it is the leading trade policy initiative of the Obama Administration, and is a manifestation of the Administration’s “pivot” to Asia. If concluded, it may serve to shape the economic architecture of the Asia-Pacific region by harmonizing existing agreements with U.S. FTA partners, attracting new participants, and establishing regional rules on new policy issues facing the global economy—possibly providing impetus to future multilateral liberalization under the WTO.

As the negotiations proceed, a number of issues important to Congress are emerging. One is whether the United States can balance its vision of creating a “comprehensive and high standard” agreement with a large and expanding group of countries, while not insisting on terms that other countries will reject. Another issue is how Congress will consider the TPP, if concluded. The present negotiations are not being conducted under the auspices of formal trade promotion authority (TPA)—the latest TPA expired on July 1, 2007—although the Administration informally is following the procedures of the former TPA. If TPP implementing legislation is brought to Congress, TPA may need to be considered if the legislation is not to be subject to potentially debilitating amendments or rejection. Finally, Congress may seek to weigh in on the addition of new members to the negotiations, before or after the negotiations conclude.


Date of Report: June 17, 2013
Number of Pages: 63
Order Number: R42694
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Trans-Pacific Partnership (TPP) Countries: Comparative Trade and Economic Analysis

Brock R. Williams
Analyst in International Trade and Finance

The Trans-Pacific Partnership (TPP) is a proposed regional free trade agreement (FTA) among 12 countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam. The negotiating partners have expressed an interest in allowing this proposed “living agreement” to cover new trade topics and to include new members that are willing to adopt the proposed agreement’s high standards. Japan is the most recent country to seek entry into the TPP. The Administration gave Congress notice of its intent to negotiate with Japan in the TPP on April 24, 2013.

The TPP negotiations have been of significant interest to Congress. Congressional involvement includes consultations with U.S. negotiators on and oversight of the details of the negotiations, and eventual consideration of legislation to implement the final trade agreement. In assessing the TPP negotiations, Members may be interested in understanding the potential economic impact and significance of TPP and the economic characteristics of the other TPP countries as they evaluate the potential impact of the proposed TPP on the U.S. economy and the commercial opportunities for expansion into TPP markets.

This report provides a comparative economic analysis of the TPP countries and their economic relations with the United States. It suggests that the TPP negotiating partners encompass great diversity in population, economic development, and trade and investment patterns with the United States. This economic diversity and inclusion of fast-growing emerging markets presents both opportunities and challenges for the United States in achieving a comprehensive and high standard regional FTA among TPP countries.

The proposed TPP and its potential expansion are important due to the economic significance of the Asia-Pacific region for both the United States and the world. The region is home to 40% of the world’s population, produces nearly 60% of global GDP, and includes some of the fastestgrowing economies in the world. Including Canada, Mexico, and Japan, TPP negotiating partners made up 40% of U.S. goods trade in 2012, and the Asia-Pacific economies as a whole made up over 62%. The TPP would be the largest U.S. FTA to date by trade value.

The United States is the largest TPP market in terms of both GDP and population. In 2012, non- U.S. TPP partners collectively had a GDP of $11.9 trillion, just over 75% of the U.S. level, and a population of 478 million, about 50% larger than the U.S. population. Japan’s entry (pop. 128 million and GDP $6 trillion) increases the significance of the agreement on both these metrics.

Unlike most previous U.S. FTA negotiations, the TPP involves countries with which the United States already has an FTA. The United States has FTAs in place with Australia, Canada, Chile, Mexico, Peru, and Singapore, which together account for over 80% of U.S. goods trade with TPP countries. Japan is by far the largest U.S. trade partner among TPP members without an existing U.S. FTA.


Date of Report: June 10, 2013
Number of Pages: 39
Order Number: R42344
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