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China, Taiwan sign historic trade pact

Head of a semi-official Chinese agency Chen Yunlin, right, gives a vase to Taiwan's envoy Chiang Ping-kun, chairman for the Taiwan's Strait Exchange Foundation, during the Economic Cooperation Framework Agreement signing ceremony in Chongqing, Sichuan province in China.

TEXT OF STORY

Bill Radke: Meanwhile, China and Taiwan signed a trade deal today that Taiwanese officials call the most important development in their relationship in more than 60 years. The deal gives access to each other's markets, but it's also a big political step for China, as the BBC's Chris Hogg in Shanghai reports for Marketplace.


Chris Hogg:It's not a complete free-trade agreement, but it will cut tariffs some more than 800 goods in the months ahead -- with more to follow later on. Some analysts believe this could boost two-way trade by up to $100 billion. And in Taiwan, create more than a quarter of a million jobs. For China, this was more about winning hearts and minds on the island it claims as its own, says Dr. Tao Wang, an economist in Beijing. Because there are many people in Taiwan who would like to be completely independent from the mainland.

Dr. Tao Wang: As far as China is concerned, if the two sides are more economically-integrated, if the people from the two sides can understand each other more culturally, there will be less support for independence movement.

But not everyone is comfortable with the new arrangements. On Saturday in Taiwan, tens of thousands of opposition supporters rallied against the deal. They fear it will bind the two economies too closely together, and in the long-term, that could be dangerous, they say, for Taiwan.

In Shanghai, I'm the BBC's Chris Hogg reporting for Marketplace.

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