Taiwan's Ma says ending China standoff a must for the economy

TAIPEI (REUTERS) - Ending Taiwan's political standoff with mainland China is necessary to boost Taiwan's sagging economy and to help it integrate more effectively with the region, the island's president, Mr Ma Ying-jeou, said.

China considers Taiwan a renegade province and has not ruled out the use of force to bring the island under its control. Economic ties, however, have grown considerably in recent years, especially since Mr Ma took office in 2008.

In October, Chinese President Xi Jinping said a political solution to the standoff could not be postponed forever. But Mr Ma later said he saw no urgency for political talks and wanted to focus on trade.

"I fully understand that if the Taiwan economy is to expand further, we need to end the cross-strait standoff," Mr Ma was quoted as saying in a statement posted on the Presidential Office's website.

The statement did not explain what concrete steps would be taken to end an impasse that has existed since Mr Chiang Kai-shek and his ruling Nationalist Party fled from the mainland to Taiwan at the end of China's civil war in 1949.

Mr Ma opened Taiwan to trade with China when he took office in 2008 and they have since signed economic agreements that have made mainland China Taiwan's largest trading partner.

But booming trade has not led to progress on political reconciliation or a lessening of military readiness on both sides.

Taiwan's export-driven economy has been hit by slower global growth, particularly by slack demand in China. The central bank left its policy rate steady for a 10th straight quarter last month to support the economy.

Taiwan hopes to join a trade pact between a dozen countries around the Pacific Rim known as the Trans-Pacific Partnership.

But Taiwan's integration into international groups can be complicated by its standoff with China, with other countries withholding official recognition of Taiwan because they are reluctant to anger China, which insists on a one-China policy.

The United States-backed trade deal aims to establish a free-trade bloc stretching from Vietnam to Chile and Japan, encompassing about 800 million people and almost 40 per cent of the global economy.

China said in May it would study the possibility of joining talks on the pact but it has said little about it since.

Despite the close economic ties between China and Taiwan, US-armed and backed Taiwan remains a potential flashpoint and a priority for China's ruling Communist Party, which is investing billions in defence modernisation.

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