Taiwan, China to sign investment pact amid protests

China and Taiwan prepared to sign a landmark investment pact in Taipei on Thursday despite protests from anti-Beijing critics on the island sceptical of closer economic ties with its former foe. China's chief negotiator Chen Yunlin and his Taiwanese counterpart Chiang Pin-kung sat down for talks before putting their names to the much-awaited deal, which will provide a legal umbrella for Taiwanese companies in China. "The agreement will have a beneficial impact on all businesses and will improve the investment environment," Chiang said in his opening remarks. "It will help boost the competitiveness for both sides amidst growing globalisation and regional coooperation." Details of the agreement will only be released after it has been signed, but in general it will increase protection for investors on both sides and is likely to unleash new fund flows as a result. The two will also sign a cooperation pact to speed up customs procedures in the hope of boosting two-way trade. The new deals follow the sweeping Economic Cooperation Framework Agreement (ECFA) in 2010 that eased tariff restrictions and gave trade a major push. But some Taiwanese fear they will strengthen China's hold over the island, and protesters have been tailing Chen since his arrival on Wednesday. About 1,300 police officers were posted around the meeting venue, a landmark hotel on a hill overlooking Taipei. Barbed wire was rolled out nearby, and police prevented a small truck covered in anti-China banners from approaching the building. "I oppose the deals because China is trying to control Taiwan's economy so it can rule Taiwan," said protester Chen Che, demonstrating with about 50 others at a museum several hundred metres (yards) from the hotel. "The deals have political purposes and they are steps towards unification. I'm worried about Taiwan's future if the government sells out to China like this. Without democracy we have nothing." Taiwan and China split in 1949 at the end of a civil war, and remained implacable enemies for decades, even after the island's businesses started exploring opportunities across the strait. Ties have improved markedly since Ma Ying-jeou became Taiwan's president in 2008 on a Beijing-friendly platform, leading to the signing of 16 agreements between the two sides to boost trade and civil exchanges. China is Taiwan's largest trade partner, and more than 80,000 Taiwanese companies now operate on the mainland, where they have invested more than $100 billion over the years. It is the eighth time in four years that Chen and Chiang meet for talks that would have been unthinkable a decade ago in the absence of formal diplomatic ties, but have now become almost routine. Thursday's meeting could be their last, with observers expecting the 70-year-old Chen to retire as China's top negotiator after Chinese President Hu Jintao transfers power to deputy Xi Jinping this year and next. "Chen is way too old to stay in that position, and he has pretty much accomplished his mission," a former Taiwanese official familiar with China affairs told AFP, speaking on condition of anonymity.