Following a series of declarations and agreements, ASEAN and China have
eventually signed the free trade agreement (FTA) that is expected to create a free trade area with 1.8
billion people in 2010. In addition to its potential economic and commercial impacts, the ASEAN-China FTA is likely to result in diplomatic and psychological marginalization for Taiwan in the short term. Under such circumstance, this article suggests that Taiwan thinks strategically and takes necessary measures to lessen the agreement's impacts via WTO and APEC, by winning support from the US, by striving to participate in the first East Asian Summit, by utilizing Taiwan's comparative advantage in commerce, by reinforcing its sovereignty claim to the South China Sea, and by taking into account the diplomatic effect of marrying Southeast Asian people.