Really Going WTO?  (c) Simon Xi Zhang, 2002



2. Reciprocal Reliance across Taiwan Strait

The "trade dependence level" (TDL) is an indicator showing the comparative level of reliance of the subject country (S) on a specific trade partner (P). It is calculated by comparing the import-plus-export volume of S with P against, (i.e., divided by,) the total import-plus-export volume of S with the whole world (including country P). According to Taiwan data, Taiwan's TDL on China has seen continuous increase -- 1.7% in 1987, 4.2% in 1990, 9.3% in 1993, 11.1% in 1999[39], and 13% in2001[40]. Chinese data shows China's TDL on Taiwan is 6.3% in 2001[41].

ImDL and ExDL[42] are calculated by the same method, substituting trade-volume with import volume, and export volume, respectively. Taiwan's ExDL on China is as high as 19.6% for year 2001[43], revealing a strikingly tremendous dependence. In 2001, China's ExDL on Taiwan is a tiny 1.9% but ImDL on Taiwan records double-digit: 11.2%[44].

Compared with the simple figure of trade surplus or deficit, TDL-ImDL-ExDL speak more about the fact the two important players in international and regional trade can not afford losing each other, in spite of political enmity therein between. To get both into WTO can promote a stable relationship between the two, at least where trade is concerned.

[39] Data 1987-1999, from Cross-Strait Economy Census Monthly Report, Issue 96, p.25 (August 2000), Taiwan Economy Research Institution Ed., Source data from MAC.

[40] See, Cross-Strait Trade Situation Analysis of December 2001 (February 27, 2002), Ministry of Economic Affairs.

[41] Calculation based on 2001 MOFTEC data, note 37, supra.

[42] ImDL = Import Dependence Level; ExDL = Export Dependence Level.

[43] See, note 40, supra.

[44] Note 37, supra.