Siew explained in a keynote speech at a forum in Taipei that this unease is what was behind the Sunflower Movement, the student-led protest that saw demonstrators occupy the Legislature, effectively delaying the ratification of the controversial trade-in-services agreement with China.

"Taiwan was caught in a dilemma where closer economic ties with China serve the interests of our economic allies such as the U.S. and Japan, but such ties destabilize our people's confidence in our strong (bond) with the U.S. and Japan," he told an audience at the Taiwan-U.S. Japan Trilateral Security Dialogue forum made up of lawmakers from Japan and the U.S. and a number of prominent scholars.

"Without that confidence, closers ties with China cannot proceed," he said, adding that the U.S. and Japan are Taiwan's staunchest allies and most important trading partners.

Noting that many people worry that an economic dependency on China carries considerable political risk, he said that Taiwan is seeking to diversify its trade even as it increases the volume of cross-Taiwan Strait trade.

Removing Trade and Investment Barriers

The best way to do that is removing trade and investment barriers with global partners, he said, pointing to the U.S.-led Trans-Pacific Partnership (TPP) trade bloc - under negotiation among Japan, Australia, Peru, Malaysia, Vietnam, New Zealand, Chile, Singapore, Canada, Mexico and Brunei - as one option to achieve that goal.

"Joining the TPP would advance Taiwan's goal of greater economic integration with our economic allies and improve strategic flexibility," Siew said.

Leaving Taiwan out of the trade bloc will create a substantial trade diversion and hurt the 12 countries in TPP negotiations because they accounted for 34 percent of Taiwan's total external trade in 2013, he said.

Taiwan Is an Important Part of Asia Supply Chain

In an effort to seek support for Taiwan's TPP bid from the U.S. and Japan, Siew mentioned Taiwan's important part in Asia's supply chain and said that inclusion in the TPP would benefit all parties. He pointed out Taiwan's strength in the areas of renewable energy, semiconductors, and information technology.

The former vice president also took the opportunity to spell out Taiwan's efforts in trade liberalization, including amending laws and regulations to ease restrictions in order to create a regulatory environment in Taiwan that meets the high standards of the TPP.

He vowed that Taiwan will continue to liberalize trade to create an environment friendlier to foreign investment.

Commissioned by the Foreign Ministry, the one-day conference is co-organized by Taiwan's Chung-Hua Institution for Economic Research, the Washington-based Center for Strategic and International Studies, and the Institute for International Policy Studies in Tokyo.