Chen Tain-jy, a professor at National Taiwan University and former minister of the Council for Economic Planning and Development, said at a seminar that Taiwan's proposed trade pact with China would normalize cross-strait economic relations, Focus Taiwan reported on Thursday.

In the video conference organized by the Government Information Office and held at 1230 GMT Wednesday in Taipei and New York simultaneously, Chen said an economic cooperation framework agreement would provide a platform for Taiwan and China to resolve all their bilateral trade issues under the World Trade Organization framework.

For Taiwan firms, the pact will convert China from an offshore export processing zone into an attractive market, he said.

This is very important in light of the fact that China is losing its luster as a global processing zone because of rising labor costs and a policy shift toward domestic market development, Chen said.

In addition to providing a level playing field for Taiwan businesspeople in China, Chen said the pact will open up new chances for them to cooperate with their Chinese counterparts.

'This will allow the two sides to pool their technologies and know-how for industrial applications,' he said.

'When free trade is achieved across the Strait, Taiwan will become a nice gateway to China for multinational firms,' Chen added.

Taiwan's vicinity to China enables multinational firms based in Taiwan to better serve their Chinese customers along the coast than their competitors located within China, Chen said.

Taiwan offers free access to information, almost unlimited support of financial credits, and free flow of personnel — services that are not available in China, Chen said.

Two other local scholars also spoke at the teleconference: Lin Bih-jaw, vice president of Taipei's National Chengchi University; and S. Philip Hsu, executive director of the Center for China Studies at National Taiwan University.

They exchanged views with William Holstein, president of the Overseas Press Club Foundation; Douglas Paal, vice president of the Carnegie Endowment for International Peace; and Daniel Rosen, visiting fellow at Peterson Institute for International Economics.

President Ma Ying-jeou's administration is working hard to conclude the pact with China in June, but has had difficulty selling it to the opposition parties, which are worried that the pact will undermine Taiwan's sovereignty.

The seminar is part of the Government Information Office's efforts to muster support for the pact.