President Mack, ladies and gentlemen, thank you very much for the warm words of introduction. First of all, I would be remiss if I forgot to congratulate the citizens of Los Angeles, for the wonderful championship of the Laker team in the NBA tournament.
I have learned a new word of English, “three-peat,” during my visit this time to L.A., and I wish we would have a four-peat next year.
Ladies and gentlemen, President Mack asked me to speak about the relationship across the Taiwan Strait. I can see why the issue should concern you because the Taiwan Strait is one of the few remaining “hot spots” in the world, and because the issue has ramifications far beyond the area of the Taiwan Strait. But believe me, we have more reasons to be concerned, and we in Taiwan, particularly my party the Kuomintang (KMT), have been handling this issue for over half a century.
In fact, I happened to be the person that was charge of the first round of bilateral negotiations between Taiwan and the Chinese Mainland in 1986. Until then, the Mainland had maintained an attitude of deep hostilities toward Taiwan, and Taiwan had likewise adopted a three-no policy: no contact, no negotiations, and no compromise. In 1986, a Taiwan cargo plane was hijacked to Guangzhou in the southernmost province of the Mainland. I was then serving as the Minister of Transportation and Communications in the Republic of China’s Government, and was put in charge of negotiating with the Mainland for the return of the plane, crew, and cargo. Until then, the decades-long practice had been that either side got to keep the defector from the other side as well as the plane and everyone and everything in it. The 1986 talks changed that practice. The defector stayed on, but all the rest was retrieved by Taiwan.
During the following decade, cross-Strait relations saw ups and downs. In the first half of the 1990s, Beijing and Taipei engaged in nearly four years of continuous negotiations, and the people-to-people exchanged underwent rapid expansion. In the second half of the 1990s, particularly following the missile crisis of 1996, the relationship plunged into one of confrontation and distrust. Bilateral negotiations ceased and people-to-people exchanged began to slow down. I don’t want to bore you with the history of the past decade. Suffice it to say that in just ten years the nature of cross-Strait relations was completely transformed. Unlike the preceding four decades, it was no longer one-dimensional, that is, confrontational. Rather, it became very much a multi-dimensional issue. Because of the expanding economic and cultural linkages, the issue was no longer simply a war-and-peace issue, but a bread-and-butter issue as well. Also, because of its possible spillover effects, it incurred increasing international concerns.
Please allow me to concentrate my remarks on developments in the more recent two years. At the risk of over-simplification, I’d like to characterize the cross-Strait relations between mid-2000 and mid-2002 as “three minuses” and “three pluses.” Whether the balance tips in favor of the plus side or the minus side is up to the beholders to decide. Although, generally speaking, I am an incorrigible optimist, when it comes to cross-Strait relations, I find myself at great pains to remain optimistic. Before I seek out your insights, let me tick the pluses and minuses one by one.
First, minus one. Why am I putting it first? Because I think it is the most important among the six factors, and unfortunately it is a minus. The picture would look very different, were this factor a plus. Here, I am speaking about the government factor. After observing the relationship for two years, it seems amply clear to me that, despite occasional gesturing, the governments on the two sides of the Taiwan Strait trust each other less now than before, when the KMT was in power. The Beijing leadership trusts Taipei less, because the ruling party, the Democratic Progressive Party (DPP) in Taiwan and President Chen Shui-bian in particular, have openly advocated Taiwan independence for a long time. After the DPP’s ascendance to power, President Chen made a commitment not to declare Taiwan independence. But, in Beijing’s view, he has taken many small steps, via so-called “salami tactics,” to move Taiwan in that direction, short of a formal declaration. Mr. Chen has also abandoned the political compromise of 1992, which formed the basis for the bilateral talks of the mid-1990s, without proposing a new basis of his own. This is why the cross-Strait dialogue has been left in limbo for two straight years.
Beijing has also contributed its fair share to the current deadlock. Of greatest concern to the people of Taiwan are the hundreds of missiles deployed across the Taiwan Strait. Most are just seven-and-a-half minutes away. And the total number of missiles goes up by fifty every year. As far as is known, Beijing’s military preparedness against Taiwan has also intensified in the last two years. Being more inclined toward eventual separation, the DPP government is more distrustful of Beijing’s intentions and less receptive to Beijing’s overtures.
The second minus has to do with the people level. Any casual visitor to the area may find that nationalist sentiment seems to be growing among the people in the Mainland. With communist ideology on the wane, nationalism quickly emerged in recent years both as a genuine belief among the populace and as an instrument for mobilization by the authorities. In fact, many observers have pointed out that as the economy enjoys high rate of growth, as the society is being increasingly pluralized, as the income gap, the urban/rural gap, and the coastal/inland gap continue to widen, and as the government and party bureaucracies continue to corrupt, nationalism will remain the most powerful glue that holds the country together. No leader can afford to brook any challenge to sovereignty, territorial integrity, or other concepts related to nationalism.
Unfortunately, the rise of nationalism in the Mainland coincides with the rise of separatist sentiment in Taiwan. There is currently a line of thinking in Taiwan that embraces only Taiwanese identity and abhors anything affiliated with China or the Chinese. Though still a minority, this thinking is widely believed to be condoned, or even promoted, by the DPP administration. If the nationalist and separatist trends continue unabated on both sides, it is not inconceivable that a clash of these two sentiments may result someday.
The third worrisome “minus” is the internal situation, again, on both sides. After twenty years of continuous economic growth and a certain degree of reform and opening, the People’s Republic of China has entered into a new stage. The top leadership in Beijing is about to undergo a generational change. The private sector has already surpassed the public sector in shares of the GDP. And the gap is growing. So the Communist Party has to co-opt and recruit new members from the emergent groups and professions. Some regions of the country are advancing into the 21st century, while others remain in the 20th, or even the 19th. Meanwhile, the same economy is marred by uncomfortable unemployment [levels] and inequitable distribution of income. And corruption by the powerful and the privileged is so rampant that other analysts foresee the coming collapse of China. Therefore, the PRC will most likely be confronted with many new problems on top of the old ones, and many painful decisions will be made under great uncertainties.
On the other side of the Taiwan Strait, the economic situation has not been very pleasant since mid-2000. The first quarter of the year 2000, which were the last months of the KMT administration, registered 7.1 percent in the rate of economic growth. For the first quarter of 2002, the percentage went down to 0.9. For the entire year of 2001, it was minus 1.9 percent. Worse still, the combined effect of declining growth and depreciating NT dollar turned the level of per capita income back to that of the year 1995. Politically, Taiwan has been wasting time on senseless issues such as “native vs. non-native,” “love Taiwan vs. sell out Taiwan,” “unification vs. independence,” and so on and so forth. This has generated only heat, not light, and has been anything but conducive to internal unity and economic growth.
Each of the three minuses, standing alone, would be detrimental to cross-Strait relations. Now we have all three at once. Hence, the chances for miscalculation on the part of the leaderships, for politicians to manipulate nationalist or separatist fervor consciously or unconsciously, or for them to divert the popular anguish outward across the Taiwan Strait must be high.
Fortunately enough, there have been three pluses in the cross-Strait relationship during the past two years that helped keep an overall precarious balance.
The first of these pluses is the people-to-people exchanges. In sharp contrast to the chilly relations between the two governments, the people’s exchanges have grown faster since mid-2000 than in any other period in history. For instance, cross-Strait trade amounted to 32.3 billion US dollars, an increase of 6 percent from the previous year. Taiwan has become the fifth-largest trading partner, and second-largest import market, of the Mainland. The Mainland is the second largest export market of, and the largest source of trade surplus for Taiwan today. Taiwan’s contracted investment in the Mainland last year was 6.9 billion U.S. dollars, of which 3.2 billion was actually invested. The investments were spread over 4,100 categories. The growth rates, compared with the previous year, were 73 percent, 34 percent, and 36 percent, respectively. Last year saw the largest growth since 1995. The people-to-people visits also set new records. Taiwanese visits to the Mainland in 2001 reached nearly 3 million, which was a jump of 10percent from 2000 and much higher than the ten-year average of 1.5 million. On the other hand, more people from the Mainland people visited Taiwan than before. In 2001, 140,000 visitor came to Taiwan, compared with 120,000 in 2000, an increase of 16percent. Taiwan undergraduate and graduate students in the Mainland number approximately 4,000. If those unofficially enrolled, part-time and short-term students, are counted the number may reach 10,000.
The second plus has to do with U.S. policy. For many years, the U.S. policy toward the area has been bracketed by no use of force by the PRC against Taiwan and no declaration of independence by Taiwan. Before 2000, this policy was understood well by both sides of the Taiwan Strait, even though the language employed by Washington was not exactly specific. After 2000, the above-mentioned “minuses” have become so serious that the U.S. began to express its policy with greater clarity. Thus, on the one hand, President Bush and other officials indicated in no uncertain terms the U.S. intention to help Taiwan defend itself should the PRC resort to the use of force while unprovoked; on the other hand, they warned against “provocation by either side,” and most recently and quite directly against “Taiwanese independence.”
This so-called “strategic clarity,” I believe, is beneficial to the preservations of the current precarious balance across the Taiwan Strait. Chances for miscalculation will thus be reduced. Therefore, I put the U.S. factor definitely among the pluses.
The last but not least plus is the role of the opposition parties in Taiwan. Because President Chen was elected with only 39 percent of the total votes in 2000, and because KMT was and still is widely deemed as far more experienced and capable of handling cross-Strait affairs, the opposition parties, particularly the KMT, continue to retain considerable influence in the issue-area. The DPP administration and the KMT agree on a number of important questions. Both oppose the PRC’s military threat. Both oppose Beijing’s “one country, two systems” design. Both oppose Beijing’s version of “one China principle.” Both insist on maintaining Taiwan’s status quo. Both insist on preserving Taiwan’s security. And both insist on Taiwan’s rightful place in the family of nations.
Yet the two parties differ on other important questions. While the DPP seeks to highlight the “native vs. non-native” divide, the KMT deems it a non-sensible issue, because Taiwan has always been a society of immigrants, just like the U.S.: After 50 years of living together, everyone is as native as everyone else. The DPP has also been nudging the country toward Taiwan independence. But the KMT feels it is neither feasible nor desirable to pursue this goal, because it will simply court disaster for everyone involved. The KMT further asserts that the best approach is to maintain the status quo: mainly no independence and no unification for the time being, and to simultaneously concentrate on government-to-government dialogue and people-to-people exchanges. The fact that these views are shared by the majority of the people in Taiwan serves as a powerful check on the DPP administration’s slide toward Taiwan independence and hence on cross-Strait confrontation.
Now we have seen three pluses and three minuses. How do we assess the balance? I have to admit it’s a tough job to do that. The weight of either side seems to be about equal. Although I am slightly pessimistic, I am not totally so. A lot will depend on how things will transpire and how much effort all the concerned parties will devote. But I know one thing for sure. If you look at the pluses and minuses once again, you will find that the pluses come from three different directions: the people, the U.S., and the opposition parties in Taiwan. But the minuses really come from only one source, that is, the governments of both sides. For the minuses 2 and 3, namely nationalism and internal situation, both subject to the governments’ control and manipulation to a great extent. Should the governments change their minds or change their hands, the picture would instantly look quite different.
This is where we — by we I mean the KMT and all those concerned about peace and stability across the Taiwan Strait — can help. As citizens of the Republic of China, we can and should help our government in its thinking and handling of cross-Strait relations. A place to start is to propose a new definition of Taiwan’s place in the world. This is not at all a philosophical issue. Rather, it has very serious policy implications.
Because of its deep animosity toward China and the Chinese and its attempt to represent Taiwanese separatists at home, the DPP tends to define Taiwan’s place as far away from the Mainland as possible. As a result, its policy practice in the last two years has been moving toward Taiwan independence. In fact, the political distance between Taiwan and the Mainland has been widened to such a degree recently, that the Bush administration saw fit to state its position with greater clarity on “no use of force” by the Mainland and “no independence” by Taiwan.
By contrast, the Kuomintang and I propose that Taiwan as a democracy, with a vibrant economy, standing at the rim of the still undemocratic Chinese Mainland, should think and act positively. Taiwan can play a positive role in three ways.
First of all, Taiwan can help the Mainland and the world by preventing the emergence of a highly nationalistic Chinese Mainland that is hostile to the outside world. It can do so by allaying the fear of the Beijing leadership that Taiwan is moving toward independence, or worse, ganging up with others in an effort toward containment.
Number two, while Taiwan certainly deserves a place in the world, it need not pursue that goal at the expense of the Mainland. It is entirely feasible to attain a win-win outcome. It is even likely to achieve a win-win-win, a triple outcome, as the rest of the world would also benefit. How is that possible? Well, in our conception, Taiwan can serve as a bridge between the Chinese Mainland and the world. Our geographic location, ethnic and linguistic affinity, and existing ties across the Strait on the one hand, and our access and familiarity with the outside world on the other, could together render Taiwan a unique role of intermediary, helping the international community enter the Mainland and helping the people of the Mainland be better integrated into the world.
Third, Taiwan could also do a great favor, not only to itself and the world, but to the Chinese people on the Mainland by improving upon its democracy, by going beyond the form of democracy such as holding elections and toward nourishing a truly democratic spirit — a spirit based on equality and mutual respect. By concentrating on improving our democracy, Taiwan would likely exert very positive influence on the Mainland. By contrast, if we continue to move toward separate and exclusive Taiwanese identity in Taiwan, we would likely give democracy a bad name in the Mainland. We would then not only undermine any prospect of democratization inside the PRC, but deepen the fault-line between Taiwan and the Mainland. And Taiwan will surely suffer the worst, should any conflict come to a head.
Ladies and gentlemen, in Taiwan we will do our best to prevent the worse from coming to the worst. During the past fifty years, the KMT has worked so hard to make Taiwan what it is today. In 1951, the per capita income was only 130 U.S. dollars. In 2000, it jumped to 13,000 U.S. dollars. In other words, over a hundred times within fifty years. During the 1990s, the KMT democratized Taiwan without bloodshed, without social instability, and without sacrifice to the economy’s growth — a rare feat indeed. Now, our success ended up in our being voted out of office. But it gives us an opportunity to reflect on our shortcomings. And it gives the people in Taiwan a chance to see what Taiwan would become without the KMT running the show.
In the last two years, the KMT has undergone a complete overhaul and has been reborn as a new force in Taiwan. We have also won several local-level elections. And we intend to march along with other like-minded political parties in Taiwan toward the 2004 presidential election. I believe a KMT victory in 2004 would, in a single stroke, reduce tensions in the area of the Taiwan Strait as well as consolidate Taiwan’s democratization and economic growth. A reinvigorated Taiwan would also be better positioned to make greater contributions to the world. With your blessing, we will surely achieve this goal. After all, it is widely regarded that it takes at least two transfers of power for a democratizing country to become truly democratic.
Finally, let me once again extend by deepest appreciation to the World Affairs Council of the Los Angeles area, to the Asia Society, and to President Mack for inviting me here. I enjoyed our pre-dinner chat with some of the Council members and with the cheerful high school students. Once again, on behalf of my wife and my colleagues tonight, I thank you all. Best wishes to you all. Thank you again.