China and Taiwan sign trade pact, possibly easing decades of tensions

Since 1949, when Chaing Kai-shek and his followers in the Republic of China government fled Nanjing for Taiwan during the Chinese Civil War, the tiny island nation and mainland China have been at odds, if not downright hostile in their relations. Six decades later, China's communist government and the democratic descendant of the ROC in Taiwan have taken a major step toward normalizing relations. China and Taiwan signed a wide-ranging trade pact today, potentially easing the troubled relationship between the two nations after sixty years. The deal includes a reduction of tariffs on textiles and petrochemicals and allow more open investment across the Taiwan Strait. About 40,000 Taiwanese companies operate in mainland China, with about $83 million in Taiwanese money invested there. "The agreements will lead to regional integration and create the basis for cross-strait economic cooperation," said Taiwan's Straits Exchange Foundation, the semi-official organization that negotiated the Economic Cooperation Framework Agreement. The agreement is seen as beneficial to Taiwan, bringing its economy closer to China's as the mainland's global clout grows. Chris Hogg of our partner, the BBC, joins the program. He's been monitoring the latest developments from Shanghai.