An official from the Taipei City Department of Health inspects a beef stall in a traditional market with reporters in Taipei March 22, 2012.
An official from the Taipei City Department of Health inspects a beef stall in a traditional market with reporters in Taipei March 22, 2012.
TAIPEI — After months of wrangling, Taiwan has decided to allow imports of American beef that contain a controversial feed agent.  But the decision - which had grown so controversial that it shut down parliament in June - was not made because Taiwanese want more steak dinners. The government of the trade-dependent, diplomatically isolated island expects key favors in return from its strongest informal ally, Washington.

Taiwan’s parliament agreed to allow imports of beef containing traces of ractopamine, an additive to animal feed that makes meat leaner, that some governments ban because of health concerns.  American officials backed by the beef industry had pressured Taiwanese officials for five years to follow the lead of Japan, South Korea and 100 other nations in allowing imports of beef that contain the drug.

Sheila Paskman, spokeswoman for the de facto U.S. embassy in Taipei, says Taiwan’s all-but-final verdict removes a stumbling block from progress in two-way trade.

“Overall the beef issue has been very important to the U.S. not just because of the beef market itself but because it represents a very important step in generally having more open and free trade between the U.S. and Taiwan," she said. "To move forward with trade talks, we really had to feel that we were dealing with a partner who was ready to move forward with trade talks.”

Beef tensions began rising in 2007. Two years ago Taiwan’s president and parliament were involved in a heated drama about imports of U.S. bone-in beef. Taiwan finally agreed to accept it. But the United States had already mothballed any hopes of a high-level discussion under the Trade and Investment Framework Agreement. That agreement allows both sides to talk about trade deals, but often lacks momentum until ranking officials meet. Taipei needs those talks to seek Washington’s blessing for an application to a nine-member Pacific Rim trading bloc, the Trans-Pacific Partnership.

The United States is Taiwan’s second-biggest export destination after China.  And, Taiwan is the 10th largest American trade partner. Taiwan is one also of the top foreign consumers of American beef, with imports of about $128 million per year.

Taiwan is also pushing the U.S. government to offer a visa waiver to its citizens. That change would make travel easier after decades of concern that Taiwan’s now defunct mail-in passport application process had allowed foreign nationals to obtain fake documents.

Taiwan’s foreign ministry spokesman, Hsia Chi-chang, says he expects the visa waiver policy to be approved by year’s end, following a U.S. Department of Homeland Security review, and for trade talks to resume by early 2013.

He says the beef issue was a major long-term obstacle and the parliament’s decision removes it. Now the commerce departments on both sides need to talk further about restarting trade discussions. Hsia says U.S. government agencies are working on admitting Taiwan into the visa waiver program.

U.S. officials say Taiwan’s admission to the visa waiver program is unrelated to beef. But analysts argue that a range of requests from Taiwan had been evaluated in the past five years in the context of meat imports. Raymond Wu, managing director of the political risk consultancy e-telligence in Taipei, does not rule out an indirect connection between beef and visas.

“Regarding the visa waiver program, I really do not think the visa waiver program has any direct relationship to the beef issue. However, because you have got to look at the U.S.-Taiwan relationship in a more comprehensive way and certainly the beef issue was not helping.”

Taiwan’s opposition Democratic Progressive Party blockaded parliament in June about the beef issue, requiring a special session last month to reach a decision. Opposition leaders had voiced health concerns about the beef thinning agent. Since the bone-in beef issue of 2010, restaurants in Taiwan have posted signs to advertise that they avoid any related imports from the United States.

In the first sign of better relations, U.S. Assistant Secretary of State Jose Fernandez will visit Taiwan for three days next week to promote cooperation in trade, investment and tourism.