Implement the ECFA: Prospects of a bilateral investment agreement between Mainland China and Taiwan

Abstract

Purpose

After Ma Yingjeou's re‐election in 2012, Mainland China and Taiwan will continue cooperation in economic fields. The purpose of this paper is to undertake research on a bilateral investment agreement (BIA) between Mainland China and Taiwan.

Design/methodology/approach

The paper uses statistics to demonstrate the growing cross‐strait investment and incompetent contemporary investment protection mechanisms in Mainland China and Taiwan. The paper also compares laws in Mainland China and Taiwan and the investment protection agreements concluded by Mainland and Taiwan with other countries, respectively.

Findings

Based on the similarities of current laws and the investment protection agreements concluded by Mainland China and Taiwan with other countries, respectively, Mainland China and Taiwan can possibility agree upon major provisions of a BIA. Solutions are provided to both macro and micro challenges against a successful BIA.

Research limitations/implications

It is hard to predict whether the BIA will promote political integration between Mainland China and Taiwan in the near future.

Practical implications

A BIA can boost investors' confidence.

Social implications

This paper may serve as a humble reference for both the Mainland China and Taiwan government when negotiating the BIA.

Originality/value

Cross‐strait investment is an important and prosperous field in practice, but has not been fully explored in literature thus far. This Article aims to fill this gap.

Citation

Huang, J. (2012), "Implement the ECFA: Prospects of a bilateral investment agreement between Mainland China and Taiwan", Journal of Chinese Economic and Foreign Trade Studies, Vol. 5 No. 2, pp. 127-156. https://doi.org/10.1108/17544401211233525