ECFA's Effect On Cross-strait Economic And Trade

Economic globalization and regional economic integration are two major development trends in the current world's economic field. On the grounding of Doha Round impasse and that it is difficult to continue to promote global economic and trade negotiations, there are more and more regional economic integration negotiations. The regionalism is actively conducting integration in various parts of the world. In order to adapt to the trend of economic globalization and regional economic integration and promote economic development, on June29,2010, Economic Cooperation Framework Agreement (ECFA) was signed in Chongqing by Association for Relations Across the Taiwan Straits and Taiwan Straits Association, which is a great turning point in the field of cross-strait economic and trade cooperation and milestone in the history of cross-strait relations. It marks that the cross-strait economic and trade cooperation begins to develop into the direction of normalization, institutionalization and liberalization..On this historical situation, the study of ECFA 's effect on cross-strait economic and trade has a certain practical significance. The paper mainly uses qualitative and quantitative and longitudinal and horizontal research method. On the basis of existing research, it synthetically using the index of trade integration, revealed comparative advantage and Diamond Model and so on, analyzes ECFA's effect on cross-strait economic and trade from theoretical and empirical perspective.The paper, firstly, outlines the five stages of cross-strait economic and trade after reform and opening up, and each stage includes the both sides'policies, attitudes and the actual situation of economic and trade exchanges. Then, it outlines the signing background of ECFA, ECFA's content and the differences between ECFA and CEPA and FTA. And it focuses on the necessity of ECFA:Taiwan is in the crisis of being marginalized in the regional economic integration; signing more free trade agreement with the other is Mainland's and Taiwan's economic development needs. Then, the paper discusses ECFA's effect on cross-strait economic and trade, which is the main content of this article. It calculates and analyzes trade integration index of cross-strait and revealed comparative advantage of Mainland's and Taiwan's commodity through large amounts of data, showing that ECFA is beneficial for both sides'comparative advantage to play, which can promote the development of cross-strait trade. It also using Diamond Model, analyzes cross-strait's factors of production, demand conditions, related and supporting industries, business strategy and structure and government and opportunities, showing that ECFA makes the five areas moves in positive direction, which can help to promote cross-strait industrial competitiveness. ECFA provides opportunities for cross-strait financial cooperation and development. ECFA helps to promote the common prosperity of the four areas.The last part summaries the main content of the paper, and analyzes the prospect of ECFA, believing that the subsequent content of ECFA will be actively implemented and executed.In short, the paper theoretically and empirically proves that ECFA is a win-win agreement, which can produce favorable economic benefits in many aspects, increase cross-strait people's common welfare, improve cross-strait relations and achieve common prosperity. The two sides should actively execute the content of ECFA, and promote the implementation of ECFA's follow-up content.