Brookings: Topics - Taiwan

Taiwan’s Response to an Evolving Security Environment

Mon, 29 Apr 2013 14:00:00 -0400

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April 29, 2013
2:00 PM - 4:15 PM EDT

Falk Auditorium
Brookings Institution
1775 Massachusetts Avenue, N.W.
Washington, DC 20036

The Ministry of National Defense of the Republic of China (Taiwan) released its second Quadrennial Defense Review (QDR) in early March. The QDR presents a comprehensive examination of developments in Taiwan’s security environment and explains updates in its planning and strategy. As in the United States and other countries, the document is a reflection of the president’s strategic priorities, a serious planning exercise and a public relations tool which seeks to inform the public and win its support.

On April 29, the Center for Northeast Asian Policy Studies (CNAPS) at Brookings and the Freeman Chair in China Studies at the Center for Strategic and International Studies (CSIS) hosted a discussion on Taiwan’s recently released QDR. Vice Minister of National Defense for Policy Andrew N.D. Yang, presented the Ma Ying-jeou administration’s views of the Asia-Pacific security environment and Taiwan’s defense transformation. Chia-Sheng Chen, director of the defense ministry’s Defense Net Assessment Division, explained the QDR in more detail. Phillip Saunders of the National Defense University added his personal perspective on the security challenges Taiwan faces and the way it addresses them in the QDR.

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China-Taiwan-United States Relations

Tue, 23 Apr 2013 09:00:00 -0400

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April 23, 2013
9:00 AM - 3:00 PM EDT

Conference Room B-1
Center for Strategic and International Studies
1800 K Street, NW
Washington, DC

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China and Taiwan have improved both the tone and substance of their relationship over the past five years, especially on bilateral economic issues. But these advances have not been matched by progress on more difficult political or multilateral issues, and some observers believe that the improvement of cross-Strait relations will lose momentum as these more sensitive issues come up for discussion. The respective political calendars in China and Taiwan may further complicate matters.

On April 23, the Center for Northeast Asian Policy Studies at Brookings and the Freeman Chair in China Studies at the Center for Strategic and International Studies hosted a public seminar featuring senior experts from the United States, China and Taiwan. Panelists analyzed the domestic forces influencing cross-Strait relations; prospects for developments in the political, security and regional economic arenas; and possible roles for the United States. Raymond Burghardt, chairman of the board of the American Institute in Taiwan, delivered a keynote address.

Watch video from the event at csis.org »

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20130423_china_taiwan_us_transcript

Reviewing Ma Ying-jeou’s Strategies for National Security in Taiwan

Richard C. Bush III — Fri, 19 Apr 2013 14:00:00 -0400

Taiwan’s president Ma Ying-jeou spoke Monday evening by video-link to a group of distinguished scholars at Stanford University. Although nothing Mr. Ma said was particularly surprising, his remarks did have three important features.

In the first part of his the speech, the president reviewed the basis for re-engagement with China after his first inauguration in 2008 and the cooperation that has been subsequently forged. This was not, of course, the first time that Ma has reviewed this record, and by now the process is well and widely understood. Yet it is still a story worth re-telling, if only to remind us that nothing about cross-Strait relations after 2008 was fore-ordained. Leaders in both China and Taiwan had to take certain risks for a more stable relationship. They had to find a mutually acceptable premise for interaction (the 1992 consensus). And agree just as clearly on what would be discussed (easy, mainly economic, issues) and what was off the agenda (e.g. independence or unification). What new agreements will be signed and whether the two sides move toward political talks is quite uncertain at this point, but what has already been achieved was neither trivial nor automatic.

Later on, Mr. Ma provided a concise yet clear statement of Taiwan’s national security strategy. To quote him in full: “The first part involves institutionalization of the rapprochement with mainland China so that neither side would ever contemplate resorting to non-peaceful means to settle their differences. The second part involves making Taiwan a model world citizen by upholding the principles of a liberal democracy, championing free trade and providing foreign aid to the international community. The third part involves strengthening national defense capability.” The first of these is particularly interesting, because it expresses an essentially liberal, internationalist approach to ensuring peace and stability: that is, binding a potential adversary to a cooperative relationship so that the stakes of initiating conflict are just too high. But the other two parts of the president’s strategy clearly indicate that he is not placing all his eggs in a Chinese basket.

In discussing Taiwan’s relations with the international community, President Ma properly cites an important, recent achievement. That is the agreement reached between Taiwan and Japan on April 10^th on fisheries. Taiwan fisherman are of course pleased because it clarifies their right in their traditional fishing grounds, but such an accord would not normally command any interest beyond the two countries concerned. But in this case it should. The matter is part of the nexus of issues that include territorial disputes over maritime land forms, the quest for natural resources, the rules of engagement of maritime vessels of contending countries, and coping with popular nationalism. The Japan-Taiwan agreement is important because it does not try to resolve all issues for all time but addresses the most pressing matters in a pragmatic and mutually beneficial way. It offers a way forward for other countries to reduce the temperature on their maritime disputes and reduce the risk of wider conflict through accident and miscalculation. As President Ma said, the pact “sets a good example of how the concerned parties can find ways to settle their dispute and preserve peace and stability in the region at the same time.” He may not have intended to allude in this remark to China, whose maritime vessels have been operating in a rather edgy way of late. But the shoe certainly fits.

Authors

Richard C. Bush III

Image Source: © Pichi Chuang / Reuters

The Brookings Institution and Taiwan-China Relations

Richard C. Bush III — Thu, 11 Apr 2013 00:00:00 -0400

Editor’s Note: In a speech delivered at “Between Power and Knowledge: Think Tanks in Transition” at National Chengchi University on April 11, 2013, Richard Bush discusses the Brookings Institution’s long history of conducting research on Taiwan-China relations. A portion of the speech is below; the complete speech can be found here.

A couple of years ago, I chanced upon an aging copy of the January 1945 issue of National Geographic magazine. To my surprise, there was an article about Taiwan (called “Formosa” in the article). As was common with National Geographic at that time, there were many pictures of the island’s aboriginal peoples (in this case, they were all fully clothed). But there were also pictures of U.S. bomb damage during World War II, and a not-bad description of Taiwan’s history, society, and 20^th century circumstances. The author was Joseph Ballantine, who had served in the American Consulate in Taihoku from 1912 to 1914. I had never heard of Ballantine, so I resorted to my default source of information – Wikipedia. Imagine my even greater surprise when I discovered that he had actually been a scholar at Brookings, and that through the Institution’s Press, he had published a book about Taiwan in 1952: Formosa: A Problem for United States Foreign Policy.[1] I had no idea that my own organization’s coverage of the Taiwan Strait issue had such a long history. So I was pleased when Arthur Ding invited me to write about how Brookings had treated the subject over the last six decades. I do so in a basically chronological way and draw on the books that a series of Brookings scholars have written that addressed cross-Strait relations to one degree or another.

[1] Joseph W. Ballantine, Formosa: A Problem for United States Foreign Policy (Washington, D.C.: Brookings Press, 1952).

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Richard C. Bush III

Publication: National Chengchi University

Facing Mainland China: Taiwan’s Future Challenges

Richard C. Bush III — Wed, 10 Apr 2013 00:00:00 -0400

Editor's Note: The following speech was delivered at Tamkang University in Taiwan on April 10, 2013.

It is a great pleasure to have the opportunity to speak at Tamkang University. I was first on your campus almost thirty years ago when I was working as a staff member in the US Congress and my boss, the late Congressman Steve Solarz spoke here. I have probably made visits since then but really can’t remember when they were. In any event, it’s great to be back. Thank you, Dean Dai, for that kind introduction. It’s always good to see Professor Lin, who was a visiting fellow at the Brookings Institution in the first year I worked there.

The topic I picked for my speech today is “Facing Mainland China: Taiwan’s Future Challenges.” Actually, Taiwan has faced challenges stemming from the Mainland for a long time, actually for more than six decades. But the challenges today and in the future are more complex and consequential than ever before. The choices for Taiwan will be difficult, and it is important that they be made well. To avoid making choices is also a choice.

Actually, it’s a bit presumptuous for an outsider to try to give advice to the citizens of another country, particularly a democratic country, on the challenges they face and how to face them. In a profound way, that really is their business. And I readily acknowledge that my own country is having great difficulty meeting its formidable challenges. But my ties to Taiwan were first formed almost forty years ago, and have only grown over time. I care very much what happens to this island and its people. So I hope you will permit me to make a few observations on my topic. I won’t talk for too long, because I want plenty of time for questions.

To begin, it is worth noting that Taiwan would face some difficult challenges even if China were not such an important factor. That is because Taiwan, like some other places in East Asia, has entered a transition in its social and economic development that requires new policy models. Even if China did not exist, these challenges would press Taiwan.

In addition, Taiwan’s economy is increasingly post-industrial and is finding it harder to remain both competitive in the global economy and provide good jobs and good wages for all. Income inequality is trending upward. The unemployment rate was higher in this past decade than it was in the 1990s (1-3 percent). The central government budget has been basically flat over the last few years, government debt is growing, but the tax burden of Taiwan citizens is fairly light (58^th among a group of 65 more advanced countries). The island has already begun to move, correctly, to a knowledge-based economy, but there a still a large number of small, inefficient, family operations. And for a knowledge-based economy, its companies will need people with the right kinds of skills, which probably requires reform of the education system.

If these challenges weren’t enough, demography makes them much more difficult. Taiwan’s total population will peak relatively soon, probably in 2025. The working age population will decline from 74 percent of the total today to around 67 percent in 2025; the elderly’s share of the population will increase from 11 percent today to 20 percent. That means that smaller numbers of workers will be supporting more and more old people. By 2060, half the population (workers) will be supporting 40% of the population (retirees). To make this specific, the students in this room will have to pay for the pensions and health care of your professors after they retire. And as long as young people either don’t get married or don’t have children, that situation will continue.

So even if China did not exist, Taiwan would face tough choices as a society: choices between economic prosperity on the one hand and social welfare—for the old and the young—on the other. But China does exist. It provides Taiwan with opportunities, to be sure. Many of you young people may work on the Mainland. But China is a source of insecurity for Taiwan, and so an added challenge. So the task for the island’s leaders and citizens will be to balance their desire for security, prosperity and welfare.

Let me turn now to the various challenges that Mainland China poses for Taiwan.

The first and fundamental challenge is Beijing’s ultimate objective regarding Taiwan, what it calls “peaceful unification” under the one country, two systems formula. In effect, it wishes to have Taiwan become a special administrative region of the People’s Republic of China, with a status essentially the same as Hong Kong and Macau.

Now Taiwan has always said “no” to one country, two systems (1C2S), and there is little public support for it. It’s important, however, that Taiwan people have a substantive foundation for their opposition rather than be opposed for opposition’s sake. To my mind, there are at least two reasons. The first that there are a serious conceptual differences between Beijing and Taipei over whether Taiwan is a sovereign entity in two important respects: first, the island’s international role, and second, cross-Strait relations. Essentially, this is the issue of the Republic of China, and there is a broad consensus here that the ROC does exist, while Beijing’s formal view is that the ROC hasn’t existed since the founding of the PRC. For Hong Kong and Macau, 1C2S granted a “high degree of autonomy” but not sovereignty. Beijing remains the exclusive sovereign. To my mind, this disagreement over sovereignty is rather fundamental.

The second reason is what 1C2S would mean, hypothetically, for Taiwan’s democracy after unification. Hong Kong is important here as well. When crafted the Hong Kong political system over twenty years ago, through the Basic Law, it skewed the electoral process in ways that made it difficult—or impossible—for individuals and political forces it does not like to come to power. We of course don’t know whether China, as part of a unification deal, would seek to change Taiwan’s political system so that it has the same effect as in Hong Kong. If it did, however, the DPP, which today is a significant portion of Taiwan sentiment, would be marginalized.

But that is just my view. What’s important is how Taiwan citizens and leaders think about this.

When the results of the 2012 presidential elections were announced on the evening of January 14^th last year, President Ma Ying-jeou said that he would “safeguard the sovereignty of the Republic of China with my life.” That’s a strong statement, and I am pretty sure that President Ma knows what he means by it. But I believe that Taiwan as a whole could broaden and deepen its understanding of the sovereignty concept. In this regard, it would be particularly useful for each of the major political parties to come to their own internal consensus and then work on a cross-party consensus.

So Challenge Number One is Beijing’s current ultimate goal, unification under 1C2S. That option – and it’s an option only – creates Challenge Number Two. That challenge is the possibility that as the ROC government negotiates with Beijing today, it may make concessions that undermine its claim of sovereignty when it comes to resolving the fundamental cross-Strait dispute. Note that Beijing has a similar challenge: as it negotiates with Taipei today, it wishes to avoid making concessions that undermine 1C2S.

This challenge has been around a long time – for both sides. It is one reason that cross-Strait relations were so difficult from the early 1990s until 2008, to the point that the United States occasionally feared that the two sides might slide toward a conflict that neither intended. This short term-long term problem remains today. Some in Taiwan say that the Ma Administration has damaged Taiwan’s sovereignty in the way it negotiated various economic agreements like ECFA without specifying exactly how. My own analysis concludes that the Ma Administration has not negotiated badly and has preserved Taiwan’s position on this key issue. But it will become important if and when the two sides begin discussions on political and security talks, because sovereignty is an inherently political issue. Which is one reason why those talks are so difficult to start, and may not start anytime soon.

Challenge Number Three is different. It concerns not the content of cross-Strait negotiations but how Beijing seeks to promote its goals concerning Taiwan. Here we need to think about how China is pursuing its objectives regarding Taiwan, and I find it useful to distinguish analytically between two different ways or paradigms: the paradigm of mutual persuasion and the paradigm of power asymmetry, which is different.

Essentially, the paradigm of mutual persuasion is a shared approach of negotiation, persuasion, incrementalism, and mutual adjustment. I would argue that this is the approach that the two sides have followed since Ma Ying-jeou took office. It is part of what Beijing understands by its concept of peaceful development. It is in Taiwan’s interest that mutual persuasion continue (also, I would argue, it is in China’s and America’s interest).

The paradigm of power asymmetry is different. Here, China would exploit the growing power gap with Taiwan – economic, diplomatic, military, and so on – by pressuring Taiwan to accept a resolution of the fundamental dispute more or less on its terms, and even though many in Taiwan would be unhappy about submitting in this way. But listen to how one influential PRC scholar of cross-Strait relations has put the matter: “The severe asymmetrical balance of power between mainland China and Taiwan is a fact that no one can change. Moreover, this problem . . . will continue to increase, a situation that Taiwan needs to handle pragmatically and calmly.” We can speculate on what the scholar means by “pragmatically and calmly.”

Why would Beijing decide on a shift in paradigm? First of all, it might do so if it decided, based on its perceptions or misperceptions, that a future Taiwan government was moving towards de jure independence, and if it could not get Washington to restrain Taipei.

But let us assume, purely for purposes of discussion, that the KMT remains in power, why then might Beijing decide to shift to a strategy of pressure and intimidation? This would happen, I speculate, if it became impatient and decided that Taiwan would never move from the status quo to unification. We have seen hints of that impatience in Chinese suspicions that President Ma’s true objective was “peaceful separation” with a “two Chinas” or “one China, one Taiwan” character. And recall that one of the circumstances specified in the 2005 anti-secession law is that “possibilities for a peaceful reunification should be completely exhausted.”

Now I actually don’t think that China will lose patience in the foreseeable future – for the rest of President Ma’s second term, perhaps. I believe that the PRC officials responsible for the conduct of cross-Strait relations are realistic about the views of the Taiwan public and the limits that places on the Taipei government. They seem to believe that time is on Beijing’s side. On the other hand, I don’t know what “new thinking” Xi Jinping may have concerning Taiwan policy, and recent statements by PRC officials urge movement on political issues. So it’s impossible to know whether Beijing’s patience will last indefinitely. No-one should assume that it will.

Note that when I talk about a Chinese strategy of pressure and intimidation, I don’t mean the use of force or even the explicit threat of force. In a situation of power asymmetry, the stronger power need not act overtly to compel the weaker power. In the Taiwan case, Beijing might conclude the very fact that Taiwan is quite dependent on the Mainland economically and the mere existence of its increasingly robust military capabilities will be sufficient to secure Taipei’s submission more or less on its terms.

Obviously, a pressure strategy would create a great challenge for Taiwan. It would. I think, create intense pressure on Taiwan’s leaders and turmoil among the public. The political system would be under tremendous strain.

So what should Taiwan do about this situation? This is my final challenge, the challenge of self-strengthening. It is really a set of challenges. And Taiwan isn’t the only country that needs to strengthen itself from within. In my view, frankly speaking, there is a lot that the United States must do to strengthen itself from within in order to rebuild the pillars of national power that have permitted it to play a dominant role in world affairs since World War II.

I have already referred to the first of these self-strengthening challenges. It is to maintain and enhance Taiwan’s global economic competitiveness in spite of the demographic shift. This requires the continued building of a knowledge-based, innovation-driven economy, and all that this implies for education, financial markets, and the level of government regulation. It requires that the Mainland side properly protects the intellectual property owned by Taiwan companies.

But economic self-strengthening also requires liberalizing its economic ties with all its major trading partners, not just China. To liberalize with China alone runs the risk of being too dependent on the Mainland. Liberalizing with all major trading partners will require eliminating some protectionist barriers, but the structural adjustment that this stimulates will work to Taiwan’s benefit. In fact, this is the policy of the Ma Administration.

I have also suggested that n terms of fundamental policy, it is a good idea for Taiwan to foster a clearer sense of what it means to say that Taiwan or the ROC is a sovereign entity, not just for its role in the international system but also regarding cross-Strait relations and the domestic political system. This will ensure that if and when political and security talks come, Taiwan’s negotiators will no what aspects of sovereignty are relatively minor and can be conceded and which are so important that they must be defended at all costs. One part of this self-strengthening will be public education so voters understand along with officials.

Diplomatically, Taiwan should ensure that its relationships with its most important diplomatic partners are strong and positive. This includes, of course, the United States and Japan, but also the principal countries of Western Europe. In this regard, I am pleased to report that relations with the United States have improved in recent years.

Militarily, Taiwan should skillfully enhance the deterrent capabilities of Taiwan’s armed forces. By this I mean raising the costs and uncertainties for Beijing if it were ever to mount an intimidation campaign, which at least implies a willingness to use force. Here, I associate myself with the Obama Administration which, in the words of one official, believes that “Lasting security cannot be achieved simply by purchasing limited numbers of advanced weapons systems. Taiwan must also devote greater attention to asymmetric concepts and technologies to maximize Taiwan’s enduring strengths and advantages.”

Finally, there is the question of the political system. Frankly, I believe that Taiwan’s political system tends to focus on relatively superficial issues – such as the security of President Ma’s daughter – rather than on the fundamental challenges that face the island. Politicians are aided in this tendency by this mass media.

Now, I understand that this is a structural problem, created not by individual politicians or media companies but by the nature of competition within both the political and media world. I also believe that Taiwan is better off having a democratic system than something else, in part because it creates a challenge for Beijing – that if it wishes to achieve its political goals concerning Taiwan, it will have to satisfy a broad spectrum of public opinion. And I realize that reforming a political system is very hard to do. Just look at the similar problems that exist in the United States. But it is Taiwan’s political system that will be the mechanism by which self-strengthening occurs in the other areas I have mentioned. So if that mechanism is not strong and effective itself, everything else will be difficult. The fundamental question is, are the people of Taiwan being well served by their political system.

None of these forms of self-strengthening will be easy, particularly in a divided polity. But they are areas where a broader and deeper Taiwan consensus will buoy Taiwan’s psychological confidence and reduce the chances of PRC pressure in the first place. In this regard, young people have a special role to play, for the simple reason that over the long term, you have the most at stake. On the other hand, for Taiwan to remain divided and forego the opportunity for self-strengthening only increases the island’s vulnerability. And it will be young people who have the most to lose.

My final question, Question 8, is what are the implications of all of this for the United States? You may have seen the policy brief of mine that Brookings issued recently, so I will just summarize its conclusions.

First of all, the fact that stabilization has only gone part way and could stall should allay any American fears that, in effect, Taiwan will “abandon America” for the sake of its relationship with China.

Second, it would be unwise for the United States to “abandon Taiwan” for the sake of its relationship with China. I and other scholars have offered several compelling reasons why this is so (as long, of course, as Taiwan desires American support):

First of all, Although Taiwan has at times been the most important source of U.S.-China differences, it is not the only one. Frictions over maritime East Asia and North Korea are examples. So conceding to Beijing on our security relationship with Taiwan would not necessarily foster a more friendly China.
Second, U.S. allies and partners—Japan, the Republic Korea, and others not necessarily in the Asian region—have much at stake in Washington’s future approach to Taiwan. Simply put, a United States that would abandon Taiwan could abandon them too.
Third, whatever China says, U.S. arms are actually not the reason that Beijing has been unable to bring Taiwan “into the embrace of the Motherland.” More to the point, China has not been able to persuade Taiwan’s government and public to accept its “one country, two systems” formula. If China were to make an offer that was actually to Taiwan’s liking, Taipei would not refuse that offer because of U.S. arms sales.
Fourth, there have been points in the past when the United States has acted in ways that placed Taiwan in a vulnerable position. Most or all of those occurred before the people of Taiwan had any say in their future, as they clearly do now. I hope that we don’t repeat this unfortunate history.

Finally, how a status quo United States and a reviving China cope with each other will be played out over the next few decades in a series of test cases. North Korea, maritime East Asia, and Iran are a few of them. Taiwan is another. Should the United States concede to China on Taiwan, the lessons that Beijing would learn about the intentions of the United States would likely discourage its moderation and accommodation on other issues like North Korea or maritime East Asia; in that respect, America’s friends and allies are right. Continuity of U.S. policy toward Taiwan will not guarantee that China’s actions in other areas will support the status quo, but it increases the likelihood that it will. Conversely, a China that addresses its Taiwan problem with creativity and due regard to the views on the island says something positive about what kind of great power the PRC will be. A more aggressive approach, one that relies on pressure and intimidation, signals reason for concern about its broader intentions. In this regard, Taiwan is the canary in the East Asian coal mine.

Authors

Richard C. Bush III

Publication: Tamkang University

Image Source: © Reuters Photographer / Reuters

Taiwan Economy: Near-term Uptick, Longer-term Challenges

Don Shapiro — Mon, 11 Mar 2013 00:00:00 -0400

Understanding Taiwan’s economic prospects at any given time starts with consideration of the state of the world economy. With export value equivalent to more than 60 percent of Gross Domestic Product, Taiwan is among the world’s most trade-dependent economies. Although its population of 23 million ranks 51st worldwide, Taiwan’s trade volume – an estimated $572 billion last year according to Taiwan’s customs statistics – is the 19th largest. Possessing scant natural resources, the island economy imports virtually all its energy needs and raw materials; on the export side, its manufacturing operations satisfy a large proportion of global demand for semiconductors, flat panel displays, precision machine tools, high-end bicycles, and a wide range of other products. Massive additional production is carried out by Taiwanese-owned factories in China, strengthening the parent companies’ bottom line.

When the world economy is in good shape, Taiwan invariably enjoys boom conditions. In periods of uncertainty such as the international economy has been experiencing recently, the impact is quickly seen on the order books of Taiwan’s exporters.

Last year’s economic performance demonstrates the connection. Before the year began, the leading forecasting organizations were projecting quite healthy economic growth for Taiwan in 2012, in the range of 4-5 percent. But the prolonged European debt crisis, lackluster pace of recovery in the United States, and slowdown in China’s growth combined to cut heavily into overseas sales for Taiwan’s goods – especially for the computers, components, and other information-technology products that represent the core of Taiwan’s manufacturing strength.

Throughout the year, the forecasters kept revising their projections for Taiwan’s growth downward. The latest calculations put final GDP growth for last year at an anemic 1.26 percent, and even that level was achievable only because of a much stronger than expected 3.72 percent growth registered in the fourth quarter. On the trade ledger, Taiwan’s year-end customs figures show a 2.3 percent drop in export value in 2012 from the previous year, to reach $301.1 billion, and a 3.8 percent decline in imports to $270.7 billion. The outlook for 2013 appears far brighter – subject of course to unforeseen changes in conditions in major markets around the world (so far, at least, economists do not view the effects of the sequestration in the United States as likely to put much of a crimp in U.S.-Taiwan trade). The Taiwan government’s Directorate General of Budget, Accounting and Statistics (DGBAS) is currently projecting 3.59 percent economic growth for this year, and most forecasts from think tanks and financial institutions have been within a similar 3.4-3.6 percent band. Where there have been exceptions, the difference has been on the high side, including a 4.2 percent projection by HSBC and 4.23 percent by Taiwan’s Cathay Financial Holding. “Taiwan starts 2013 on a firmer footing on the back of China’s recovery and better-than-expected U.S. growth,” HSBC Greater China said in a report.

Taiwan, in fact, seems poised to be among the best performing economies in the East Asian region this year after China. The International Monetary Fund is forecasting 3.6 percent growth for South Korea, 3.5 percent for Hong Kong, 2.9 percent for Singapore, and 1.2 percent for Japan.

For Taiwan, a current bright spot is its mounting trade with Southeast Asia. Last year when Taiwan recorded decreases in its export shipments to every other major market, its sales to the ASEAN-6 countries of Thailand, Malaysia, Indonesia, Singapore, the Philippines, and Vietnam jumped by an impressive 9.8 percent. The $55.7 billion total equaled 18.5 percent of Taiwan’s overall exports, up from a 16.5 percent share in 2011. Continued expansion of trade with a flourishing ASEAN is expected to reinforce the positive outlook for 2013.

The once rapid growth in trade with China, in contrast, may begin leveling off, due to an import-substitution effect as the PRC develops more of its own sources of supply for goods like petrochemical intermediates and industrial machinery and equipment. In 2012, direct shipments to China accounted for nearly 27 percent of Taiwan’s total export value, but an even more telling figure is the almost 40 percent share taken together by China and Hong Kong, since many of the items sold to the former British colony are later transshipped to the mainland proper.

At the same time as the import-substitution factor plays out, however, some Taiwanese products may gain attractiveness in the China market as a result of cross-Strait trade agreements now being negotiated. The Economic Cooperation Framework Agreement (ECFA) signed by representatives of Taiwan and China in 2010 has so far had limited impact, since only an “Early Harvest” portion covering 539 Taiwanese commodities and 267 products from China has gone into effect. The tariff concessions for the Early Harvest items were also phased in over three years, and only this year reach the zero-tariff level. But the ECFA framework calls for additional agreements – with a pact on trade in services reportedly close to completion, and one covering a broad range of goods due to follow next year.

The trade relationship with the United States, after being eclipsed for a time by the dramatic rise in cross-Strait commerce, now appears to be coming in for greater attention. After a long period of soured government-to-government trade relations due to Taiwan’s restrictions on the import of American beef products on alleged food-safety grounds – regulations that the U.S. side contended were blatantly protectionist and without scientific merit – Taiwan last fall dropped its prohibition on beef containing traces of the leanness-enhancing feed additive ractopamine. That step opened the way for resumption of high-level negotiations under the 1994 bilateral Trade and Investment Framework Agreement (TIFA). Once held routinely on an annual basis, those talks had not taken place since 2007 due to the beef dispute – but they are being conducted this week in Taipei despite continuing U.S. dissatisfaction that the market for pork was not opened at the same time as beef.

The TIFA talks themselves will deal mainly with fairly technical regulatory matters, but some bigger-picture topics are also likely to be raised. Taiwan is known to be interested in discussing the possibility of the two sides entering into a bilateral investment agreement or even a free trade agreement, a goal for which some influential members of the U.S. Congress have recently expressed their support.

A few decades ago, the United States was by far Taiwan’s largest market, at one point taking close to half of all its exports. Now it is second after China (or third if ASEAN is treated as a single market), last year directly absorbing $33 billion worth of Taiwan products for an 11 percent share. Not to be overlooked, in addition, is that many of the Taiwanese goods shipped to China are components and materials that wind up in finished products – mainly made in Taiwan-invested factories – destined for American buyers.

For the United States, Taiwan is the tenth largest trading partner and the sixth largest market for agricultural products. Taiwan’s total imports from the United States came to $23.6 billion last year.

Composition of GDP

Besides the contribution of exports, the primary momentum behind Taiwan’s GDP growth this year is expected to come from improved levels of private domestic investment. After negative growth in that category in both 2011 (down 1.26 percent) and 2012 (minus 1.35), DGBAS forecasts that private investment will rebound by 5.51 percent this year as companies increase capacity to take advantage of the better export opportunities.

The Taiwan government is also optimistic about the potential for attracting China-based, Taiwan-owned enterprises to “come home” with new investments on the island. So far only a handful of such cases have been announced, including projects by Catcher Technology, a leading maker of metal housings for computers, and Eminent Luggage. But a number of large companies are known to be discussing investment opportunities with the Taiwan authorities.

“The differential in production cost between China and Taiwan has narrowed and in some cases disappeared, especially when factored for productivity,” says Gordon Sun, director of the Macroeconomic Forecasting Center at the private Taiwan Institute of Economic Research (TIER). He notes that in Shanghai and some other coastal areas of China, labor and property costs may be even higher than in Taiwan. Rather than move to less-costly locations in the Chinese interior, which may present logistical challenges, some operations may prefer to place more of their resources in Taiwan. Sun says the machinery industry is one of the most likely to select Taiwan as the site for expansion projects.

To induce China-based businesses to return, the government is offering help with land acquisition in special economic zones where investors will be free of certain regulatory restrictions. The benefits will include the right to employ larger quotas of less-expensive foreign labor for the first two years of operation.

Foreign direct investment (FDI) is expected to make up only a small part of the overall private-investment equation. Last year Taiwan’s Investment Commission approved a total of $5.5 billion in foreign investment projects, an improvement over the $3.8 billion in 2010 and $4.9 billion in 2011. Taiwan’s FDI totals, however, continue to be well below the levels attracted by other countries in the region. One reason may be the reluctance of large private equity funds to propose new projects in Taiwan after several highly publicized cases in recent years in which investment applications from PE companies were not approved. Although the reasons for the lack of approval were never explained to the satisfaction of the applicants, the authorities appeared uneasy about the possibility that prominent companies might be delisted from the Taiwan Stock Exchange.

Another segment of the economy expected to do better this year is the banking sector, long plagued by low profit margins due to over-competition within a relatively small market. Recent cross-Strait agreements permitting Taiwan banks to start doing business in renminbi – mainly offering loans to Taiwanese companies with manufacturing plants in China – should present Taiwan’s financial institutions with new and more remunerative lending opportunities.

Other than exports and private investment, strong drivers of GDP growth are likely to be absent in 2013. DGBAS expects private consumption, for example, to see only modest 1.45 percent growth this year. After a disappointing 2012, both private companies and the government were more frugal than usual in handing out annual bonuses this Chinese New Year, and there was no pay raise for civil servants and many private-sector employees this year. In addition, notes TIER’s Sun, at least a million Taiwanese – mostly relatively high-income technical and managerial personnel – are currently living and working in China. “That means they’re making the bulk of their purchases on the mainland rather than adding to local consumption,” he says.

Although the fiscal situation in Taiwan has not been as dire as in many countries that have felt obliged to adopt stringent austerity measures, rising budget deficits are a serious concern. As a result, increased public spending on infrastructure and services to help provide economic stimulus has been ruled out. Instead, government investment is set to decrease this year – dropping by 8 percent on top of a 10.8 percent decline in 2012. Even for many construction projects already approved, the schedule appears to have been slowed down.

As a proportion of GDP, tax revenue in Taiwan is an extremely low 12.8 percent – about half the level in the United States, which is already well below that of Europe. Budgetary pressure has further heightened following the decision in 2010 to lower the top rate for corporate income tax from 25 percent to 17 percent to bring Taiwan more in line with regional competitors for investment Singapore and Hong Kong. In an effort to respond to criticism that a disproportionate amount of the tax burden falls on the salaried class, the government last year reinstituted a capital gains assessment on securities, but the legislature passed only a watered-down version, leading to the resignation of the finance minister, a leading economic reformer.

Other key indicators, however, have contributed to a sense of optimism about 2013. The unemployment rate, which in 2010 stood at more than 5 percent, an unusually high level for Taiwan, has continued to decrease; it is now 4.16 percent and economists consider that it may fall below 4 percent by the end of this year. At the same time, Taiwan has been enjoying relative price stability. Despite hikes in electricity and gasoline prices as the government reduced what were in effect subsidies to consumers by state-owned enterprises, as well as higher vegetable prices following a spate of typhoons, the consumer price index in 2012 rose by a still-modest 1.93 percent and is expected to be even lower this year.

New directions

Since coming into office in 2008, the administration of President Ma Ying-jeou has put much of its emphasis on fostering better cross-Strait relations, looking to closer ties with the booming Chinese market to help spur economic growth in Taiwan. The result has been most evident in the tourism sector. For years, Taiwanese travelers flocked to China for business and sightseeing, but barriers on both sides blocked traffic in the other direction. Now Chinese visitors – mainly in tour groups but recently individual travelers as well – are helping to balance the tourism flow, bringing welcome business to Taiwan’s hotels, restaurants, shops, and tour-bus operators. Of the 7.3 million foreign visitors to Taiwan last year, 2.5 million were mainland Chinese.

Inbound tourism in general, long neglected in favor of manufacturing, is now being promoted more heavily as a non-polluting industry that contributes to easing the over-reliance on exporting. Although Chinese tourists are the most numerous at popular sights such as Sun Moon Lake, Taroko Gorge, and the Taipei 101 skyscraper, Taiwan is also attracting increasing numbers of visitors from Japan, Korea, Hong Kong, and Southeast Asia.

Looking longer-term, the Ma administration has identified a series of objectives as necessary to set the groundwork for Taiwan’s continued prosperity, referring to them as key pillars of future economic development. The most important among them are Trade Liberalization, Industrial Innovation, and Energy Security – each designed to overcome what could otherwise be a serious obstacle to Taiwan’s economic viability.

For Taiwan, trade liberalization is less a matter of lowering tariffs – most of which have been at reasonable levels since Taiwan’s 2002 accession to the World Trade Organization – than of eliminating protectionism in the form of regulatory barriers such as inadequate transparency. As a result of Beijing’s efforts to isolate Taiwan internationally, Taiwan has largely been left out of the wave of trade liberalization that has taken place over the past decade as countries have increasingly entered into bilateral free trade agreements or worked to set up multilateral trade blocs such as the Trans-Pacific Partnership (TPP) that the United States is currently negotiating with 10 other governments. Another such nascent bloc is the Regional Comprehensive Economic Partnership (RCEP) centering around ASEAN and China. If Taiwan remains excluded from such arrangements, it risks seeing its exports become increasingly uncompetitive in other markets.

With its ECFA agreement with Taiwan already in place, China now seems to have less objection to Taiwan concluding trade pacts with other countries. Taiwan expects to complete an FTA with Singapore in the coming months, and another with New Zealand is under negotiation. But those are small economies, and it is unclear whether China’s more open attitude would extend to Taiwan signing free trade agreements with larger trading partners such as the United States or to participating in the TPP and/or RCEP. Also uncertain is whether Taiwan is willing to adopt major regulatory reforms at this stage to demonstrate its readiness to join such undertakings, or whether it would be reluctant to give up any chips before actually engaged in negotiations.

The need to foster more industrial innovation stems from Taiwan companies’ longstanding reliance on contract manufacturing for other corporations. That business model served Taiwan well for many years, but it offers much lower profit margins than marketing unique products under one’s own brand. The government is encouraging companies to engage in more R&D, and the huge government-backed Industrial Technology Research Institute provides support to companies in the private sector. Still, with some exceptions such as the highly successful Taiwan Semiconductor Manufacturing Co., Taiwanese firms are facing an increasing challenge in competing against industrial giants like Korea’s Samsung.

The issue of energy security may be coming to a head later this year as the government has agreed to the opposition party’s calls for a national referendum on whether Taiwan should continue with nuclear-power development. The vote will determine whether a fourth nuclear plant, construction of which is nearing completion after numerous delays, would be allowed to become operational. Japan’s Fukushima disaster of 2011 lent added momentum to what was already a strong anti-nuclear movement in Taiwan.

Risks regarding nuclear safety will need to be weighed against the risk of serious power shortages and substantially higher electricity costs if Taiwan abandons the nuclear option. Nuclear power currently accounts for about 17 percent of the electricity generated in Taiwan, and President Ma has already stated that the existing three nuclear plants will be decommissioned when their authorized 40-year lifespans expire between 2018 and 2025. Without a new nuclear plant or extension of the old ones, it is questionable whether Taiwan has feasible options for meeting its energy needs. Renewable sources such as solar and wind energy are not sufficient to take up that slack, coal-fired plants face opposition on environmental grounds, and heavy reliance on liquefied natural gas (LNG) – which is highly expensive to transport and store – could be so expensive as to undermine Taiwan industry’s competitiveness.

Besides the energy challenge, the new cabinet of Premier Jiang Yi-huah, who took office last month, will have to overcome resistance from various quarters to seek to push through some needed reforms. Among the most pressing:

Overhaul of the pension system, especially for civil servants, who currently receive far more generous terms than available to private-sector employees. Given the current fiscal crunch, the government finds it difficult to maintain those conditions, but reform risks alienating some of the staunchest backers of the ruling Kuomintang (Nationalist Party).
Adjusting the rates charged for water usage, which are among the lowest in the world, leading to wastage and providing no incentive for conservation. Scientists say Taiwan may be in for one of its periodic droughts later this year, exacerbating the problem, but consumers are likely to complain vociferously about higher prices, especially after last year’s increases in electricity tariffs.
Encouraging another round of consolidation in the banking sector, considered to be one of the least efficient areas of the economy and a drag on Taiwan’s development. Of the 38 domestic banks, some of the largest are government-owned, but suggestions about selling off those assets trigger criticism that instead of serving the public interest, the result would be only to increase the power of Taiwan’s large business groups.

Assuming that Taiwan finds answers to its energy and other challenges, however, it has the potential to develop into a prosperous commercial hub for multinational business operations in Asia, a recent American Enterprise Institute study concluded. “Taiwan Inc.: A Home for Global Business,” a paper co-authored by Dan Blumenthal, Rupert Hammond-Chambers, Michael Mazza, Gary Schmitt, and Derek Scissors, noted Taiwan’s many advantages, including its central geographic location, technology manufacturing prowess, skilled labor force, and respect for the rule of law. It urged the U.S. government to find ways to encourage the Taiwan economic reform process for the sake of economic and strategic benefits for both parties.

Authors

Don Shapiro

Image Source: © Pichi Chuang / Reuters

Taiwan’s Incomplete Third Line of Defense for National Security

Kwei-Bo Huang — Tue, 12 Feb 2013 11:07:00 -0500

Seeking to provide a clear and effective blueprint for Taiwan’s national security, in May 2011 President Ma Ying-jeou enunciated “three lines of defense” through which Taiwan would seek to enhance its international status and security in the face of a rising mainland China. This strategy emphasizes an ambitious approach to keeping Taiwan safe. Two of the three legs have been implemented with some success, but one of the lines has been obviously deficient so far.

The first line of defense is the institutionalization of cross-Taiwan Strait rapprochement, to enable recent improvements to withstand potential future difficulties. This institutionalization is based on the current functional agreements and memoranda of understanding (MOUs) signed between Taiwan and mainland China.[1] The second line of defense is the utilization of Taiwan’s geographic location, infrastructure, and democracy to interact with and make concrete contributions to the world, hoping for an increase in Taiwan’s economic performance and humanitarian aid, the latter of which looks at international development that can establish a place for Taiwan on the moral high ground of international relations.

These first two lines of defense appear to be in good shape, although portions of the Taiwan polity may disagree with parts of the plan itself, or progress in achieving some of its goals, or both. The Ma administration is aware of this and, generally speaking, has considered the domestic-international nexus and endeavored to find an array of solutions for such conflicts. In the past five years, Taiwan and mainland China have signed 18 agreements, including the most prominent one – the Economic Cooperation Framework Agreement (ECFA) – and two MOUs. The number of direct flights between Taiwan and mainland China each week has reached 616, and in 2012 there were 2,580,000 visits by mainland Chinese tourists to Taiwan. Taiwan’s economic performance is improving – the predicted economic growth rate for 2013 is above three percent, and the very first economic cooperation agreements with major Asia Pacific trading partners, i.e., Singapore and New Zealand, are close to completion. In addition, the Ma administration has abandoned the “checkbook diplomacy” method of attracting diplomatic partners and has joined the international mainstream by abiding by the 2005 “Paris Declaration on Aid Effectiveness” and carrying out Taiwan’s foreign aid programs with the participation and assistance of its vibrant civil society.

In comparison with the first two lines of defense, the third line of defense – “aligning Taiwan’s defense with diplomacy” – seems to only have some general guidelines but few detailed and deliberate action plans. President Ma’s priorities for constructing this line of defense include building up Taiwan’s credibility and trust with its allies, the United States in particular, and enhancing Taiwan’s strong determination to defend itself. President Ma firmly believes that it is of political and strategic importance for Taiwan to continue to acquire defensive articles with the appropriate quality and quantity from the United States. The promotion of Taiwan’s soft power is also key to the success of this strategy. “Complementary to our defense capability,” President Ma has said, “[are] Taiwan’s democratic values, rule of law, and an advanced civil society, which could make Taiwan an indispensable reference for socio-economic development in the Chinese mainland.” While the outlines of this third line of defense are visible, it is evident that Taiwan has not brought the different strands of this idea together to substantially connect its national defense and diplomacy.

In order to effectively implement this third line of defense and really align its defense with diplomacy, Taiwan must rethink its practices for interagency collaboration and make some tangible action plans.

The paragraphs that follow will focus on the issue of collaboration between the Ministry of National Defense (MND) and the Ministry of Foreign Affairs (MOFA), which is substantially implied in President Ma’s design. For a preliminary understanding of how to achieve the third line of defense through interagency collaboration, the rationales, structures, and approaches will be discussed in brief.

Rationales for MND-MOFA Collaboration

First, with regard to the rationales, as introduced earlier, aligning defense with diplomacy to make good use of both hard power and soft power for national security is of strategic significance for Taiwan. This depends partially on interagency collaboration and has much to do with two executive agencies in the Executive Yuan, i.e., MND and MOFA.[2]

A strong rationale for interagency collaboration comes from the overlapping missions of MND and MOFA. MND’s basic objectives are “preventing war,” “defending the homeland,” and “countering terrorism and responding to contingencies.” MOFA is responsible for cultivating good neighborliness with other state and non-state actors and ensuring a friendly environment for Taiwan’s preservation and sustainable development “in a spirit of independence and initiative and on the basis of the principles of equality and reciprocity.” MND’s objective of preventing war and MOFA’s goal of befriending other state and non-state actors and ensuring a favorable external environment are not incompatible. Maintaining an appropriate self-defense capability while preventing war in a diplomatic way is a common-sense objective for Taiwan. By the same token, in order to secure the third line of defense, both MND and MOFA should work together to fulfill their missions in common.

Then, a critical question that must be asked is: Have such rationales been recognized completely, or at least widely, by both MND and MOFA? Maybe MND’s and MOFA’s leaderships and most of their staffs have perceived and accepted the request of President Ma, but the extent to which this request has been implemented in practice remains uncertain. This uncertainty arises not from “bureaucratic resistance” to change, but to the ways in which Taiwan’s bureaucratic system operates.

It is understandable that repertoire-bound bureaucracies with existing routines are both facilitators for and barriers to the pursuit of government policy. In the case of Taiwan, due to insufficient top-down “pressure,” the repertoires and routines of bureaucracies seem to be barriers to the realization of the third defense line. Without breaking the boundaries set by these repertoires and routines, MND and MOFA will not have true opportunities to explore the commonalities of their respective key missions. Furthermore, it is possible that bureaucracies have their own “turfs” and might lack adequate communication and exchanges essential for coordinating complicated missions. It is also possible that their executives often compete with one another in order to gain influence on national policies. Bureaucrats may play constructive roles in breaking down these barriers, but high-level political appointees’ personal characters and awareness of interagency collaboration and coordination could be more effective in facilitating better collaboration.

In order to secure the third line of defense, an understanding and sense of the need for interagency collaboration, the presence of initiative, and the cultivation of working relationships will strengthen anemic interagency communication and cooperation between MND and MOFA ― but only to a certain degree. What Taiwan really needs at this time is stronger initiative and persistent fostering of cross-agency interactions that can facilitate the goal of aligning defense with diplomacy. This can only come from above.

Structures of MND and MOFA

Second, examining the structures of MND and MOFA, it is apparent that Taiwan is not ready for real interagency collaboration.

MND’s organizational structure demonstrates the sporadic need to deal with diplomacy and international affairs. The units of MND that have more to do with diplomacy and international affairs may include the Department of Strategic Planning, the Department of Integrated Assessment, the Office of Defense Procurement, the Office of the Deputy Chief of Intelligence, and the Bureau of Military Intelligence. MND has military attachés or equivalents in most of Taiwan’s overseas missions where there is a practical need for military diplomacy or intelligence exchange. MND has also maintained a number of exchange programs aimed at military diplomacy, realized through activities such as symposiums on regional security and defense affairs and personnel exchanges with many diplomatic and non-diplomatic allies. In principle, by nature, and by training these units are more concerned with military affairs than diplomatic ones.

MOFA’s organizational structure is geared almost solely toward diplomacy and international affairs; only its Department of Policy Planning has a 2-to-3-person division dealing with “strategic security” affairs, broadly defined. Although all of its geographic departments have officials responsible for collaborating with MND for military diplomacy programs, this kind of work has been conducted on an ad hoc basis. Better and consistent coordination within both MOFA and MND is required. The work conducted by MOFA’s Department of North American Affairs seems relatively more effective and has drawn the most attention because this department is the major unit in MOFA in charge of Taiwan-United States relations, including arms sales, but this is not representative of the overall level of interagency collaboration between MND and MOFA.

Many clues indicate that, except at the top leadership level, the exchange and sharing of information between MND and MOFA have not been institutionalized satisfactorily. For example, the coordination of strategic communication by MND (synchronizing the military’s messages with its actions to shape domestic and international public opinions) and public diplomacy by MOFA (using public communications media, exchanges, educational-cultural programs, and dealing with an array of state and non-state actors for the purpose of influencing the politics and foreign policies of other governments) appears even weaker. Such coordination is a requirement for dealing with today’s rapidly changing external environment. MND does have a Political Warfare Bureau, but it is militarily and domestically oriented. MOFA set up a Public Diplomacy Coordination Council and a Department of International Information Services after its new structure was determined in 2012, but they are not given enough training, tools, and resources for effective public diplomacy and have few connections with MND. The lack of interagency collaboration further deteriorates the preparedness of these units for the trials associated with strategic communication or public diplomacy.

As neither MND nor MOFA is sufficiently organized and trained to plan, coordinate, and integrate the resources and mechanisms available for the establishment of the third line of defense, at the present time Taiwan is not able to achieve this goal.

Approaches to Enhancement

It is unclear what approaches the Ma administration has undertaken to better align Taiwan’s defense with diplomacy

There may be some “relatively good practices” to improve the “semi-vulnerable” linkage of MND and MOFA. Despite their different natures and despite their diverse expectations and priorities, as mentioned before, MND’s and MOFA’s basic aims and key missions for the enhancement of Taiwan’s national security are not incompatible at all. Officials from both ministries should have an awareness of each other’s differences, respective concerns, and ways of thinking. They should also develop a common language and commit to working toward a common or shared goal.

Three immediately feasible and likely approaches to aligning defense with diplomacy may include the encouragement of officials to engage proactively in an interagency process, the ad hoc arrangement of staffing exchanges between the two Ministries, and joint workshops or training sessions. All of these should be guided by the existing modi operandi regarding information sharing and confidentiality, in conjunction with the revocation of obstructive personnel and accounting laws and regulations. Meanwhile, individuals and agencies involved in interagency collaboration should be assigned clear roles and responsibilities. Generally speaking, for Taiwan, there is a long way to go, but once sustained these approaches will enable MND and MOFA to interact more efficiently.

In the past decade, occasionally, some political appointees in both the Chen Shui-bian and Ma administrations have sought to promote ― either explicitly or implicitly ― a consciousness of the need for more interagency collaboration in the national security field, using some of the measures suggested above. Unfortunately, for the most part these efforts have ceased when the individuals behind them have left office.

Concluding Remarks

It seems that since President Ma took office in May 2008, Taiwan has concentrated predominantly on the first two lines of defense for national security: the institutionalization of cross-Taiwan Strait interactions, and the emphasis on Taiwan’s economic and other soft power advantages to highlight Taiwan as an indispensable partner and responsible stakeholder in the international community. The third line of defense – aligning defense with diplomacy – is also being constructed, but at a very slow pace and with insufficient initiative. Beyond a doubt, United States arms sales to and political support for Taiwan are in the spotlight, and they remain extremely crucial for Taiwan’s national security. Yet, support from the United States is not enough by itself. To really consolidate this defense line, Taiwan must speed up its interagency collaboration now, beginning with MND and MOFA. This is an inexpensive way to improve Taiwan’s national security, but it requires a political investment and resolve from the leadership.

President Ma must know clearly that his national security triad will not function as expected if any of the defense lines is ignored or mismanaged. Nonetheless, it remains to be seen whether the in-depth shaping and adjustment of the third line of defense will take place in the near future, especially as the administration is confronting a series of serious and intricate domestic and external challenges that have troubled the Ma administration for a couple of years. Furthermore, Taiwan’s political calendar, featuring the 7-in-1 local elections in late 2014 and presidential and legislative elections in early 2016, indicates that consolidating the third line of defense may soon become more difficult if President Ma fails to give enough attention to the consolidation program now.

[1] Technically, the parties to the agreements are the Taipei-based Straits Exchange Foundation (SEF) and the Beijing-based Association for Relations across the Taiwan Straits (ARATS), the non-governmental organizations authorized by Taiwan and mainland China, respectively, to manage cross-Taiwan Strait affairs.

[2] In promoting Taiwan’s national security, two major agencies outside the Executive Yuan, the National Security Council (NSC) and the National Security Bureau (NSB) as part of the NSC organ, must also be included in the interagency process. To avoid over-complicating matters in a short space, this essay will exclude discussion of the NSC and NSB, but their roles in enhancing President Ma’s third line of defense are indispensable.

Authors

Kwei-Bo Huang

Image Source: © Nicky Loh / Reuters

The Future of China-Taiwan Relations

Wed, 06 Feb 2013 14:30:00 -0500

Event Information

February 6, 2013
2:30 PM - 4:00 PM EST

Falk Auditorium
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC 20036

During much of the 2000s, tensions between Taiwan and China roiled the stability of East Asia. Each side feared the intentions of the other and acted on those fears, creating a vicious circle of political mistrust and military build-up. The United States was drawn in because Beijing and Taipei each urged Washington to take its side against the other. Some strategists believed that Taiwan was the only issue that might spark a U.S.-China war. Over the last five years, the relationship between China and Taiwan has changed for the better, with cooperation replacing confrontation, and the danger of war declining. However, future momentum will likely slow, and China has not abandoned its goal of unifying with Taiwan on its terms. Will it be content to continue its current, incremental approach? What will happen if it doesn’t? What can Taiwan, China and the United States do to ensure that the current stability will continue?

On February 6, the Center for Northeast Asian Policy Studies at Brookings (CNAPS) hosted the launch of a new book, Uncharted Strait: the Future of China-Taiwan Relations (Brookings, 2013) by CNAPS Director and Senior Fellow Richard Bush. Uncharted Strait explores the significant shift in cross-Strait relations and prospects for the future. Senior Fellow Mireya Solís, the Philip Knight Chair in Japan Studies, provided introductory remarks and moderated the discussion.

Uncharted Strait: The Future of China-Taiwan Relations

Richard C. Bush III — Mon, 04 Feb 2013 00:00:00 -0500

China and Taiwan have been, for decades, adversaries separated by a 110 miles of water. Yet today, robust travel, trade and investment flow between the two nations. But despite their friendly terms, the troubling issue of unification continues to loom. Senior Fellow Richard C. Bush in his book, Uncharted Strait: The Future of China-Taiwan Relations, explores the future of cross-Strait relations.

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Uncharted Strait: The Future of China-Taiwan Relations

Authors

Richard C. Bush III

Uncharted Strait : The Future of China-Taiwan Relations

Richard C. Bush III — Tue, 29 Jan 2013 00:00:00 -0500

Brookings Institution Press 2013 319pp.

The future of the Taiwan Strait is more wide open than at any other time in recent decades. Tensions between China and Taiwan have eased since 2008, but the movement toward full rapprochement remains fragile. Whether the two sides of the Strait can sustain and expand a cooperative relationship after decades of mutual distrust and fear is still uncertain.

In Uncharted Strait, Richard Bush, who specialized in Taiwan issues during almost twenty years in the U.S. government, explains the current state of relations between China and Taiwan. He discusses what led to the current situation and then extrapolates the likely future of cross-Strait relations. Bush also explains America’s stake, analyzing possible ramifications for U.S. interests in the critically important East Asia region as well as recommending steps to protect those interests.

As Bush explains, current engagement between Beijing and Taipei increases the likelihood of a peaceful long-term solution to their six-decade dispute. Whether, when, and how that might happen, however, is shrouded in uncertainty. The Taiwan Strait is now uncharted water, and both shores worry about the shoals that may lurk below the surface. China still fears the island’s permanent separation, either because it makes an overt move to de jure independence or continues to refuse unification on Beijing’s terms. Taiwan fears subordination to an authoritarian regime, an adversary from the past that may not have its best interests at heart. And the United States fears instability in East Asia.

Contents

Introduction
Historical Context
Political Context
Setting the Analytical Stage
Economic Stabilization
Political Stabilization
Security Stabilization
PRC Pressure
Ma’s Second Term
Can Taiwan Strengthen Itself?
Implications for the United States

Praise for the work of Richard Bush:

“Perils of Proximity is a superb blend of synthesis and analysis that will appeal to both specialists and lay readers. A significant addition to the field!”
—Dr. David M. Finkelstein, Vice President, Center for Naval Analyses

With Untying the Knot, “Richard Bush has written the most comprehensive English-language accountof the vicissitudes of cross-Strait relations.”
—Pacific Affairs

ABOUT THE AUTHOR

Richard C. Bush III

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Thoughts on the Republic of China and its Significance

Richard C. Bush III — Thu, 24 Jan 2013 17:12:00 -0500

Editor's Note: In a keynote address delivered at the Academia Historica in Taipei, Taiwan on September 13, 2012, Richard Bush discusses the creation of the Republic of China (ROC) a century ago, and highlights the importance of the ROC – particularly for Taiwan – as it seeks to shape its relationship with Mainland China and the world.

I am pleased to give the conference keynote address this morning. This is a great honor, one that I had no reason to expect, and one that I do not deserve. Actually, it’s rather presumptuous for any outsider to offer judgments on your history. But once my old friend Lu Fang-shang extended the invitation, I really could not say “no.” But I speak with some humility.

I am pleased that the 國史館 has chosen to hold its conference in 2012 and celebrate the founding of the Republic of China (ROC) one hundred years before. We understand the various reasons why many organizations, including the Brookings Institution, held anniversary conferences last year. Yet the events of 1911 were important primarily for what they destroyed. 1912 is important for what it created. Today, I will offer some random thoughts on that creation and what it means. In no way will I try to be comprehensive. But I will argue that the creation of the Republic of China a century ago remains important to this day, and particularly for Taiwan as it seeks to shape its relationship with the Mainland and the world.

We must acknowledge that it is something of a miracle that the ROC actually survived to celebrate a 100th anniversary. There were at least a couple of times (1949 and 1979) when some Americans, for example, believed that its days were numbered. And they were prepared to accept that outcome.

We can get a glimpse of the ROC’s troubled history merely by recalling what was happening at each of the decade anniversaries (each of the years that end in “2”):

1922: China was deeply divided among militarist groups that competed for territory and the capital in Beijing. The Kuomintang (KMT) was not yet a major force.
1932: Japan was completing the occupation of the Northeast; a conflict erupted in the Shanghai area; the Great Depression badly hurt the Chinese economy; and efforts to wipe out the Communist base areas in Jiangxi province were unsuccessful.
1942: Japan occupied much of East China; the road to victory in the Anti-Japanese War was obscure; China had just acquired a strong ally in the United States but the united front with the Communists had dissolved.
1952: The ROC had lost the Mainland to the Communists, and it was only because North Korea had invaded South Korea that the government was safe on Taiwan, with American protection. Reform had only just begun on Taiwan and there were a host of political and economic difficulties and tensions.
1962: The transition to export-led growth, which created Taiwan’s economic miracle, was underway, but the KMT regime was still quite authoritarian. There was a public dispute with the United States over ROC military action against the Mainland.
1972: The Taiwan economy was doing well, but the ROC lost its UN seat and Richard Nixon made his trip to China.
1982: The United States had terminated diplomatic relations with the ROC three years before and ended the bilateral defense treaty. In 1982, it also concluded an agreement with Beijing on limiting arms sales. With the deterioration of President Chiang Chingkuo’s health, the future of the island was quite uncertain.
1992: This year, the trends were actually quite positive. Mutually beneficial economic relations with the Mainland were expanding; there was some hope for a political understanding; and Taiwan was well on its way to becoming a full democracy.
2002: There was a new, negative trend. Political tensions within the island were deepening. Antagonism was growing with both Beijing and Washington. The People’s Liberation Army (PLA) had begun a serious, Taiwan-focused program of military modernization.

I have no intention of reviewing this history in any greater detail. Instead, I wish to examine three ways in which the idea of the ROC has been belittled in the past, and to assess whether those interpretations are justified. The first of these is the political implication of the ROC’s military defeat in what is called the Chinese civil war. The second is that the ROC, with its claim to be the government of all of China, is an anachronism. And the third view, held by some people on Taiwan, is that the ROC is the symbol of a tragic and a brutal past. I will offer my reasons for thinking that each of these views is wrong and superseded by new realities.

At the heart of this history is the issue of whether the ROC is a sovereign state or entity, as Taiwan leaders have claimed and as the People’s Republic of China (PRC) government has denied. The answer to that question has profound implications for Taiwan’s international role and for the future of cross-Strait relations. In this context, President Ma Ying-jeou’s statement on the evening of January 14th this year, that he would safeguard the sovereignty of the Republic of China with his life, is quite important. So is the formula, which he stated in his second inaugural address, of “one Republic of China, two areas.”

The ROC as the Defeated Side in a Civil War

Turning first to what we call the Chinese civil war, there is no question that the ROC armed forces were defeated in the military struggle with communist armies on the Mainland in the late 1940s. You all are more familiar with the reasons for that defeat than I am. And if Kim Il Sung had not invaded South Korea on June 25, 1950, Mao Zedong might well have carried out his plans to invade Taiwan and to achieve total victory. In fact, Taiwan was able to survive and thrive. But Beijing has taken the position that a state of cross-Strait hostilities still exists and has periodically proposed an accord to end the state of hostilities.

One possible implication of this view is, of course, that the PRC is the victor in the civil war and therefore the successor state to the ROC. Beijing thus takes the position that the ROC ceased to exist on the same day that Mao Zedong announced the creation of the PRC – October 1, 1949. Beijing’s theory about the ROC, as elucidated in a white paper issued in February 2000, included two points:

When the central government of the PRC was proclaimed on October 1, 1949, the ROC government was “replaced” as the government of all of China and its “historical status” was brought to an end.
Even though “the KMT ruling clique” continued to use the terms “ROC” and “government of the ROC,” it had “long since forfeited its right to exercise state sovereignty on behalf of China and, in reality, has always remained only a local authority in Chinese territory.”

Or, to quote Hu Jintao, the national division that has lasted since that time is not “a state of division of the Chinese territory and sovereignty. Rather, it is a state of political antagonism that is a legacy, and a lingering one, of the Chinese civil war that took place in the mid to late 1940s.” The state of division will be ended at some point in the future, preferably by peaceful means but nonpeaceful means are not ruled out.

By the way, you may know that Mao tentatively decided to keep the name “Republic of China” for his new government, when it became clear that his military forces were going to win the fight with Chiang Kai-shek’s army in the late 1940s. That was what Chiang had done when he established the KMT regime in 1928. But people convinced Mao that the Communist revolution was so special that the old title was no longer appropriate. Hence the name, “People’s Republic of China.”

I find that the term “civil war” is striking for its political and legal neutrality. It suggests that the combatant forces in the conflict somehow appeared out of thin air and started fighting. That may be true in some cases, but what usually happens is that a rebel group takes up arms against the established government. That government may be weak; it may not command much legitimacy. Yet it is still the government.

Consider the American example. We now refer to the conflict that began in April 1861 as the American civil war. But that was not the name that the Lincoln Administration used. The most common name in the North, both during the conflict and for years thereafter was “the war of rebellion.” The South, of course, called it something else: “war of secession” or “war of independence.” But as far as the national government was concerned, the South was in rebellion and it was the task of the national government to suppress that rebellion.

So this conception of civil war raises an interesting question. If the ROC was the government of China before October 1, 1949, as even Beijing seems to accept, what was the political character of the Chinese Communist Party (CCP) and its army prior to the proclamation of the PRC?

In fact, Mao Zedong and the Chinese Communist Party had an ambivalent attitude towards and relationship with the ROC government. For most of the period from the mid-1920s, when the KMT and the CCP formed their first united front, until the PLA’s victory on the Mainland in 1949, the two sides were locked in ideological and mortal combat. It is fair to say that the CCP rejected the KMT’s legitimacy as the ruling party of China and sought to replace it. The main justification for that project was classbased, the CCP assertion that the KMT served the interests of China’s landlords and big bourgeoisie and so was on the wrong side of history.

But there were a couple of times that the CCP accepted or contemplated accepting the authority of the ROC government. The first was the second united front, formed to oppose Japanese aggression. Under this arrangement, the CCP agreed to abandon its policy of armed revolt, abolish its soviet government, abolish the term “Red Army” and put its troops under government command, and to accept as its own the KMT’s program: the Three Principles of the People of Dr. Sun Yat-sen.

Mao, of course, was unwilling to totally give up class struggle or the independence of the CCP, but these had less priority than the united front and the national struggle against Japan. Mao’s Selected Works has items from this period in which he refers to the “central government” or the “national government.” He did so even as relations between the two parties were breaking down, and he made some efforts to reverse the downward spiral in the interest of continuing the “national struggle.” The problem, he asserted for awhile, stemmed from “ringleaders of the pro-Japanese clique,” not from the KMT regime itself.

The second instance was the immediate postwar era. In January 1946, the People’s Political Consultative Conference, at which all political parties including the CCP were represented, passed resolutions recognizing the national leadership of Chiang Kai-shek and calling for the writing of a new constitution, pending which a coalition government would be created. In February 1946, the KMT and the CCP reached an agreement which would integrate the communist armies into the national army. Of course, these agreements quickly fell apart in a climate of deep mutual mistrust. But their working assumption was that the CCP acknowledged and accepted – at least temporarily – the legal authority of the ROC government.

Therefore, what we call the Chinese civil war is, in essence, the CCP’s violent rebellion against the national government, which happened to be ruled by the Nationalist Party (the KMT). The ROC government enjoyed international recognition as the government of the Republic of China, and, as I have explained, even the Communists temporarily accepted that status. And just because the rebels won control of the Chinese mainland does not, in my view, negate the existence of that government. At least conceptually, the burden of proof should be on the CCP regime to justify its status rather than on the ROC to refute the allegations of its demise.

Note the curious phenomenon that since the 1950s, Beijing has sought to convince Americans that Taiwan’s continued separation is analogous to the American civil war, with the Mainland as the North and Taiwan as the South. Ironically, however, Beijing has the roles reversed. If anyone in the 1940s was analogous to Lincoln, it was Chiang Kai-shek. Mao Zedong was China’s Jefferson Davis and Robert E. Lee combined.

My point here is that even though the Nationalist armed forces lost the military struggle with the CCP, the political and legal character of that conflict preserves a degree of legitimacy for the ROC. It is a legitimacy that remains relevant to the current day. It should not be abandoned by accepting Beijing’s definition of history.

The ROC as Anachronism

Related to the idea of the ROC as The Defeated is the view of the ROC as an anachronism. After 1949, many observers and governments regarded as an illusion the claim of Chiang Kai-shek that the ROC was the government of all of China; that the communist rulers on the Mainland were bandits; and that someday, somehow the Mainland would be retaken. To be sure, U.S. diplomats worked hard for many years to keep the ROC in the United Nations, even though they feared it was a losing battle. They even suggested a two-Chinas rationale to forestall the ROC’s expulsion, but President Chiang rejected it out of hand until it was too late. Many of these same American diplomats and many American citizens believed that it was in the U.S. interest to accept the reality of the PRC and to free U.S. foreign policy from the constraints that Chiang imposed. This was related to the idea, in some quarters, that great powers like China are all that matter, and that small powers like Taiwan are unimportant. That logic has motivated U.S. policy from time to time, and there are still some who believe it.

A broader implication of the idea that the ROC was an anachronism was that the PRC was the wave of the future. This line of thinking goes back to the 1940s when the CCP cleverly created the impression for Americans and others that it was a reformist party that contrasted favorably with the corruption of the KMT regime. It was revived in the early 1970s at the time of Nixon’s opening to China; with the beginning of reform and opening up under Deng Xiaoping; and with the PRC’s emergence as a global manufacturing power house that appeared to be driving the global economy. The reality of the communist regime did assert itself regularly, of course: the Great Leap Forward, the Cultural Revolution, Tiananmen, and now the anxiety that a rising China will challenge the predominance of the United States in East Asia. Yet the positive perspective on the PRC’s trajectory persists.

The dark side of the CCP regime did create an opportunity for the ROC: an opportunity to distinguish itself as different and better. For too long, I think, the ROC did not take that opportunity, and preferred to complacently portray itself as “Free China.” The reality within Taiwan was quite different, but we understand the reasons why.

All that changed in the 1980s, when, under the leadership of President Chiang Ching-kuo, it was decided not only to reduce the barriers to human and business contact with the Mainland, but also to remove the barriers to political participation at home. President Chiang had the counter-intuitive insight that the KMT could more easily stay in power by opening up the political system rather than devoting more resources to repression. He also understood that the two sides of the Strait had begun a new competition and that Taiwan should emphasize political change. And his emphasis had the added value of creating a new, values basis for relations with the United States. As the first ethnic Chinese society to stably make the transition from an authoritarian political system to one that was liberal, pluralistic, and competitive, Taiwan became the poster child for the third wave of democratization. And it made that transition as the world was absorbing the sad lessons of the PRC’s Tiananmen crackdown. True, there was soon a period when many worried that the leaders that Taiwan voters had selected were pursuing policies that undermined peace, but the last two presidential elections have restored confidence in the pragmatism and good sense of the Taiwan electorate.

Taiwan’s democratization is relevant to a more general assessment of the ROC’s political development. Here I draw on the scholarship of Francis Fukuyama of Stanford University, particularly his Origins of Political Order. Fukuyama posits that a well developed political system must do three basic things: build an effective state; institute the rule of law; and create methods for accountability. The second two elements – rule of law and accountability – will check the potential excesses of a strong state. Fukuyama also makes the important point that political development as he defines it can be reversed and become political decay.

The history of the ROC displays many of the features of Fukuyama’s approach. The ROC state had to be built in the midst of conflict, usually military conflict, and was the object of competition of various military formations. After 1928, Chiang Kai-shek sought to increase the capacity of the state as he fought off various challengers, including the CCP and the Japanese. After a period of political decay and military defeat during the 1940s, and once the ROC government re-located to Taiwan, Chiang continued state-building to better contend with the communists. Indeed, the ROC’s first fifty years confirms Charles Tilley’s famous dictum: “War makes the state, and the state makes war.”

It was not until the late 1950s that the ROC, with U.S. aid and encouragement, made a fundamental policy shift and gave greater emphasis to economic development by adopting a strategy of export-led growth. This was remarkably successful, inserting Taiwan companies into global supply chains for the first time and spurring improvements in standards of living and social life. But it could not have occurred without the efforts of talented technocrats creating new capacity within the ROC state, even if priorities of their institutions conflicted with those of officials responsible for national security.

But this success story only took Taiwan partway down the path of political development. After all, the PRC today has achieved what Taiwan had accomplished by the mid-1980s. It has a state that is strong enough to ensure national security and rapid economic growth. But recall that Professor Fukuyama identifies two other tasks that must supplement state-building: establishing the rule of law and ensuring political accountability. I have already discussed democratization, and I can report that Fukuyama makes the judgment that no Chinese government has accepted a true rule of law except the Republic of China on Taiwan. It therefore remains the model for political development in the Chinese world and beyond. In that important regard, the ROC has created its own wave of the future and is definitely not an anachronism. However, and this is important, it must avoid the danger of political decay – a subject to which I will return.

The ROC as Symbol of a Tragic Past

There are those on Taiwan who do not identify positively with the ROC. This is because they associate the ROC with the repression and denial of liberty that occurred between the late 1940s and the mid-1980s. And the tragedy of those years was profound, just as the democratization that followed is impressive. The part of society that doesn’t like the term “Republic of China” is only prepared to accept it as the national title of the country or state that they prefer to call Taiwan. They accept that title for pragmatic political reasons, and probably hope that it is only a temporary expedient. I understand that not everyone on the island shares that view of history, but it is a reality that will only go away with time, if then.

Divergent views of the past and the different degrees of identification with the Republic of China would not be a problem if the island did not face a rather fundamental challenge of a PRC that is increasingly powerful and has clear goals concerning Taiwan. But it does, and a Taiwan that cannot agree on such fundamental political issues is in a position of greater weakness.

This difference was on display in the heated discussion surrounding the “one country, two areas” formula that KMT Honorary Chairman Wu Po-hsiung reportedly conveyed to PRC President Hu Jintao. Two issues are at play here. The first is whether the geographical territory of Taiwan and its associated islands belongs to the state called China (either the ROC or the PRC). Was it returned to China after World War II? On this issue, the PRC position and the traditional ROC position are the same: Taiwan was returned. The Democratic Progressive Party (DPP) position is that it was not. Japan gave it up in the 1952 peace treaties, but did not transfer it to another state. The second issue is the legal and political status of Taiwan (whatever name is used). Is it a sovereign entity for purposes of the international system and the resolution of the fundamental cross-Strait dispute? Here the PRC position is that it is not, and the KMT and DPP positions are more closely aligned: it’s an “independent, sovereign state.” But the disagreement between the KMT and DPP on the ROC remains. So when President Ma in his second inaugural address offered his formulation of “one Republic of China, two areas,” he was addressing both of these issues at the same time.

This disagreement between territory and the state relates to contending forms of nationalism. Scholars suggest that people can identify with their nation in different ways. One is identification with a specific territory or national-ethnic group, or both. This is the type of nationalism that we see in China from the nineteenth century on: a loyalty to the territory that the Qing Empire controlled (more or less) and to the Han nationality. I would argue that this same type of nationalism is animating around 25 percent of people on Taiwan. They identify with Taiwan itself and assert that the people whose families came here before 1945 are a separate, politically relevant ethnic group. But there is also the concept of what is called civic nationalism: an attachment to the political system and its associated institutions and norms. This is the nationalism that best characterizes the United States, which ethnically is a hodge-podge of various groups. Civic nationalism, I would suggest, is becoming the dominant type for a majority of Taiwan people. It is an attachment to the island’s democratic system and its norms of popular sovereignty and majority rule. To put it simply, it is an attachment to today’s ROC and all it stands for.

These differences between ethnic nationalism and civic nationalism and between territory and the state are not simply an abstract academic matter. They have significant consequences for cross-Strait relations. A Taiwan that cannot agree on these issues is a Taiwan that is in a weaker position visà-vis the PRC. If there were ever an issue on which a “Taiwan Consensus” is needed, this is it. To put it differently, a failure to agree on what aspects of Taiwan’s sovereignty must be defended at all costs and which are relatively trivial will only handicap Taipei’s negotiating position. When President Ma says that he will safeguard the sovereignty of the ROC with his life, I’m pretty confident that he knows what he is talking about. I also happen to think that the DPP would be better able to defend Taiwan’s core interests, as it defines them, if it were to embrace the ROC as a sovereign entity whose continuous history began a whole century ago, a history that is longer than that of the PRC by thirty-seven years.

The Second Century

Yet securing a Taiwan consensus on sovereignty and the significance of the ROC is only one part of the current challenge facing Taiwan. In its first century, the ROC succeeded in transforming itself into a truly modern state. To borrow the words of Professor Fukuyama, it has performed well the task of modern politics, which he defines as taming “the power of the state, to direct its activities toward ends regarded as legitimate by the people it serves, and to regulate the exercise of power under the rule of law.”

Professor Fukuyama also draws a useful distinction between the scope of the state and its strength. Scope refers to the tasks that the state undertakes. Strength means its capacity to implement and enforce the tasks that it assumes. On both measures, there is great variety. The PRC has broad scope and strong capacity. The United States has had limited scope and high capacity (although the future is in question). Turkey and Brazil have modest scope and high capacity. Weak or failing states have low scope and low capacity. I think it’s fair to say that the scope of the recent ROC state has been appropriate for good governance, focusing on those tasks that we associate with a modern, liberal state. Generally, it has done those tasks well. That is, the ROC state’s capacity has grown when necessary to meet new challenges.

Yet Fukuyama warns us that just as political systems can develop, increasing both capacity and scope, they can also decay. In that case, their capacity can decline in relation to their tasks. The pressing question for the ROC’s second century is whether the ROC state is capable of performing the tasks that face it. And these tasks are not small.

Economically, Taiwan faces the constant challenge of remaining competitive in an era of both globalization and rapid technological change. That is particularly complex since the magnetic power of the PRC economy is so strong. How then does Taiwan extract the benefits of economic engagement with China while preserving the ability to maintain an optimal position in global supply chains and so ensure high employment with good wages for all? If this requires liberalizing its economic relations with all major trading partners, as I believe it does, is Taiwan willing to remove the protectionist barriers that limit the market access of those trading partners? How should economic growth and environmental protection be balanced? And, returning to the issue of the capacity of the ROC state, is the economic technocracy that facilitated Taiwan’s twentieth century industrialization properly engineered to foster and guide an innovation- and knowledge-based economy in the twenty-first century?

Socially, Taiwan faces the challenge of an aging society with a very low birth rate. Does the ROC state have the correct policies to provide good health care at a moderate cost for all, and to ensure an adequate supply of employees with the right skills (even if it means expanding immigration)? Assuming the government has good policies, will it have the resources to meet the education needs of young people and the pension and health care needs of retirees?

When it comes to security, does Taiwan have a proper evaluation of the coercive threat posed by a PLA that continues to expand its war-fighting capabilities? Does Taiwan’s defense establishment need to find new ways to strengthen deterrence?

And do the institutions that usually facilitate public participation actually ensure sound, broadly supported public-policy decisions? Taiwan would be best off, I think, by achieving simultaneously the goals of prosperity, social welfare, and security; and, toughest of all, of coping with a China that seeks to complete its mission of unification. But one has to ask, is the political system, which is very good at stimulating intense electoral competition, distributing benefits, and pointing fingers, able to address these issues in ways that are effective and truly reflect the wishes and interests of Taiwan’s people? Will the island be blessed by both good leaders and good followers?

I do not have answers to those questions, but I do know they are important. I suspect that the answers will be formulated in the first decade of the ROC’s second century, for good or ill. In that decade, the ROC may constitute some of the most significant challenges that it has ever faced. If the latter decades of the ROC’s first century are any guide, decades when, as President Ma has said, the ROC was reborn on Taiwan, then we can have confidence that they will be answered well. Yet as the history of the first century has demonstrated, success will not come easily, and wisdom and hard work will be essential.

Authors

Richard C. Bush III

Publication: Academia Historica

Uncharted Strait: On America's Security Commitment to Taiwan

Richard C. Bush III — Mon, 14 Jan 2013 00:00:00 -0500

EXECUTIVE SUMMARY

A few influential Americans have begun to suggest that the United States should reduce its long-standing security commitment to Taiwan. Some say that Taiwan itself has chosen to improve relations with China, so the island has less need for advanced U.S. weaponry and a defense pledge. Others argue that Washington, to avoid unnecessary tensions with a rising China, should accommodate Beijing on the most neuralgic issue—Taiwan.

The first group overstates the limits of the ongoing Taiwan-China détente. True, progress has been made in normalizing, liberalizing, and institutionalizing the economic relationship. But, to the disappointment of many Chinese, none has occurred on political and security issues, because the Taiwan public is not ready to go there and serious conceptual differences exist on how to get there anyway. So the prospects for cross-Strait relations in the near-term are for modest, incremental progress only, or a stall.

The second group misunderstands the benefits and costs of a significant American accommodation to China regarding Taiwan (e.g. by sharply cutting back arms sales). In fact, Washington has frictions with China on a growing list of issues. Conceding to Beijing on Taiwan will not help us elsewhere. Moreover, our friends and allies (e.g. Japan and Korea) will worry that the United States might sacrifice their interests next for the sake of good relations with China. Finally, the primary reason China has failed to incorporate Taiwan on its terms is not U.S. arms sales but because its negotiating position is unacceptable to the Taiwan public.

As China rises and seeks to reshape East Asia more to its liking, how the United States responds will be a critical variable. It needs the right mix of accommodation and firmness. Giving way on Taiwan will neither pacify Beijing nor assure our allies.

Introduction

Should the United States abandon Taiwan? Until recently, even to pose such a question would have been unthinkable in Washington. While the U.S. relationship with Taiwan may have had its ups and downs over the past six decades, but the strong American commitment has endured. But now, individuals who previously served in senior positions in the U.S. government are calling it into question. Theirs is not a modest proposal, and it deserves careful examination.

Some observers believe that Taiwan has become a strategic liability. They remind us that China regards the settlement of the Taiwan problem as its internal affair, yet the United States continues to provide the island with advanced weaponry and at least an implicit pledge to come to its defense. They echo Chinese diplomats who argue that our arms sales are the major obstacle to good U.S.-China relations. (These diplomats also assert that U.S. arms sales both discourage Taipei to negotiate seriously with Beijing and encourage Taiwanese politicians who have separatist agendas.) Therefore, it is argued, the United States needs to reconsider fundamentally its security support for Taiwan.

The most prominent voice for this point of view is Zbigniew Brzezinski, Jimmy Carter’s national security adviser. He argues that the hostility that arms sales foster in Beijing precludes whatever strategic cooperation a declining United States can secure from a rising China. Moreover, he says, “it is doubtful that Taiwan can indefinitely avoid a more formal connection with China,” and points to some version of the unification formula Beijing used for Hong Kong as a possible basis. That in turn would end the island’s need to depend on the United States for its security.[1] Others in this camp, more or less, include retired admiral Bill Owens, retired ambassador Chas Freeman, Charles Glaser of George Washington University, and the members of a policy panel assembled by the Miller Center of the University of Virginia.[2]

To make the conversation even more interesting, there are two other versions of this abandonment idea, ones that start with how Taiwan has changed since 2008:

At least one conservative Congressman, a long-time supporter of Taiwan, believes that Taiwan was now working with an “autocratic China,” and since he opposes autocracy, the island’s government no longer deserved his support.[3] That is, Taiwan has abandoned U.S. values, which is bad, so he has abandoned Taiwan.
A Portland State University scholar has argued that Taiwan seems to have decided that its own best interests require it to accommodate to China and rely much less on the United States (as Finland accommodated the Soviet Union during the Cold War). But in his view, this is good for Washington because it eliminates a long-time burden.[4] And a Taiwan scholar recently argued that it was in the island’s own interest to get out of the middle of the China-U.S. rivalry.[5]

In the abstract, it should not be surprising that some Americans are rethinking U.S. support for Taiwan. We live in a new world. China’s power and international role are growing. It is in the interest of the United States to maximize areas of cooperation and mutual benefit with Beijing where possible, even as we demonstrate firmness when it overreaches (as it has). It is not in the U.S. interest to act in ways that lead Chinese leaders to conclude that America pursues a policy of containment. So, this logic goes, perhaps Washington should end commitments that are so offensive to China that it will not cooperate with the United States on projects of strategic value to us. Moreover, as the People’s Liberation Army (PLA) becomes more capable, America may find it harder operationally to honor its commitments to Taiwan, even if it wished to do so.

Taiwan Shifts Strategy

To sort through these competing ideas, it is necessary to understand how U.S.-China-Taiwan relations have changed in the last five years and what it means for U.S. policy.

For twenty-five years, Taiwan has faced a serious dilemma. On the one hand, many Taiwan companies benefit from investing in China to produce goods for the Chinese and international markets. On the other hand, China wishes to end Taiwan’s separate political status on terms similar to that used for Hong Kong, which most Taiwan people oppose. From around 1995 to 2008, Taiwan’s response to China’s political goals was to emphasize the island’s sovereignty, which only led Beijing to fear that Taiwan’s leaders intended to create a totally independent country. China in turn built up military capabilities to deter what it feared, which only made Taiwan more anxious. Washington worried that this action-reaction spiral might lead to war, and it periodically opposed some of Taipei’s initiatives.

Ma Ying-jeou won Taiwan’s 2008 presidential election by articulating a different vision: that the island could better preserve its prosperity, freedom, dignity, and security by engaging China rather than provoking it. Engagement would focus first on enhancing economic cooperation, thus avoiding contentious and unproductive political arguments. Expanding business ties would yield concrete benefits for both sides of the Taiwan Strait. Opening Taiwan universities to Mainland students would fill out enrollments and expose Chinese young people to a democratic society. In short, Ma believed, Taiwan could give China such a large stake in peace that it would not dare to risk that stake by coercing the island into submission. He made significant progress during his first term in removing obstacles to business and liberalizing trade, most notably in reaching an Economic Cooperation Framework agreement with China in 2010, the first step toward creating a free-trade area. Taiwan bounced back fairly quickly from the global economic crisis and had 4 percent growth in 2011. A growing stream of Chinese tourists buoyed some sectors of the Taiwan economy, and the number of Mainland students grew steadily.

Ma had another reason for engaging China: the United States. Taipei’s relations with Washington had suffered before 2008 because U.S. officials feared Taiwan’s political initiatives would spark a Chinese over-reaction, creating a conflict that might require American intervention. The reduction of tensions that Ma’s policies brought about calmed Washington’s fears and increased U.S. confidence that Taiwan’s intentions were constructive. The Bush and Obama administrations responded by improving U.S.-Taiwan relations, by approving three large arms-sales packages and extending other benefits.

Yet Ma’s China policy was not a total accommodation to Chinese wishes. Even though Beijing in 2009 exerted pressure on Taiwan to move toward political and security talks, Ma pushed back, and for good reason. The Taiwan public was not yet ready to support them, particularly the approximately 25 percent who retain the goal of total independence. In any case, there were serious conceptual differences between the two sides, specifically whether Taiwan was a sovereign entity for purposes of cross-Strait relations and the island’s international role. On the security side, China continued to build up its military capabilities relevant to Taiwan—particularly ballistic and cruise missiles. According to one think-tank’s analysis, an intensive missile barrage by the PLA can now ground Taiwan’s air force in the very early stages of a conflict, and Taiwan’s current defense strategy depends on its aircraft getting off the ground.[6] So Ma has spurned Chinese proposals for a peace accord because he does not see how it would improve Taiwan’s security, and his caution has persisted to this day.

In effect, Ma has pursued a mixed or hedging strategy toward China: engage it in areas that both benefit Taiwan and encourage Chinese restraint (economics and education); deflect Beijing on proposals that are not in the island’s interests (politics and security); and preserve a good relationship with the United States (to guard against the worst). A significant part of the Taiwan public—known as the Green Camp—was not happy with Ma’s mix of engagement and firmness. They feared he had put the island on a slippery slope to subordination and unification on China’s terms. The Greens would have preferred more firmness and less engagement. Yet so far, Ma’s strategy has the backing of the majority of island’s public, usually known as the Blue Camp. In the last election apparently, around 55 percent of voters approved of his approach while 45 percent remained skeptical or deeply opposed.

Back to the Question of Abandonment

The fact that Ma is hedging the island’s bets should be reassuring to Americans who worry that Taiwan is, in effect, “abandoning the United States” for the sake of relations with China. Such strategic appeasement would only be happening if Taipei were willing to concede to Beijing on political and security matters. Yet Taiwan has been unwilling to abandon its claim that it is a sovereign entity and accept a solution similar to that applied to Hong Kong. Instead, it asserts what Ma calls “the sovereignty of the Republic of China.” Moreover, Taipei sees a continuing need for a deterrent against China’s use of its growing military capabilities. Even as it sees the value of enhancing Beijing’s stake in peace, it does not fully trust statements of peaceful intentions. And it is certainly not prepared to terminate its special security relationship with the United States.[7]

The more difficult question is whether the United States, for the sake of its own relationship with China, should, in effect, abandon Taiwan. China believes that U.S. political and security support for Taiwan is the primary reason it has not achieved its unification goal, because it fortifies the confidence of the island’s leaders that they can get away with refusing to negotiate on PRC terms. So Beijing believes that if it could induce Washington to end arms sales to Taiwan’s military, drop even an implicit commitment to defend the island if attacked, and support unification, its problem would be solved. So China would be very pleased if the United States abandoned Taiwan, and has suggested that if only Washington ended arms sales, U.S.-China relations would be problem free.

American analysts have offered several compelling reasons why the United States should not dissociate itself from Taiwan as long as Taiwan desires American support:[8]

Although Taiwan has at times been the most important source of U.S.-China conflict, it is not the only one. For example, Beijing’s goals in East Asia are not limited to bringing the island back into the PRC fold. In addition, it seeks to expand its security perimeter away from its eastern and southern coast, where it was for decades. That in turn has meant that the PLA navy and air force are operating increasingly in the traditional domain of U.S. and Japanese forces.[9] Removing Taiwan as a problem would in no way end or reduce this mutual impingement; it would only change its location. Taiwan aside, Beijing would still regard American “socialization” as negative.
U.S. allies and partners—Japan, the Republic Korea, and others not necessarily in the Asian region—have have much at stake in Washington’s future approach to Taiwan. Simply put, a United States that would abandon Taiwan could abandon them. Of course, there may be hypothetical reasons why America might withdraw support that stem from Taiwan’s policies rather than its own commitment. So the reasons for any abandonment would be important. But the fear remains.
Whatever China says, U.S. arms are actually not the reason that Beijing has been unable to bring Taiwan “into the embrace of the Motherland.” More to the point, China has not been able to persuade Taiwan’s government and public to accept its formula, which is called “one country, two systems” and was the one used for Hong Kong. If China were to make an offer that was actually to Taiwan’s liking, it would not refuse because of U.S. arms sales. Of course, a weak and friendless Taiwan might conclude that it had no choice but to settle on whatever terms it could extract. But that is not an outcome to which Washington should be a party (nor is it really in China’s interest to gain Taiwan through intimidation).
Finally, how a status quo United States and a reviving China cope with each other—their key foreign policy challenge for the rest of the century—will be played out over the next few decades in a series of test cases. North Korea, maritime East Asia, and Iran are a few of them. Taiwan is another. While active U.S. opposition to Taiwan’s unification with the Mainland would understandably lead Beijing to infer that our intentions are hostile across the board, supporting Beijing’s approach when Taipei objects would be a serious demonstration of weakness.

Should the United States concede to China on Taiwan, the lessons that Beijing would learn about the intentions of the United States would likely discourage its moderation and accommodation on other issues like Korea or maritime East Asia; in that respect, America’s friends and allies are right. Continuity of U.S. policy toward Taiwan will not guarantee that China’s actions in other areas will support the status quo, but it increases the likelihood that it will. Conversely, a China that addresses its Taiwan problem with creativity and due regard to the views on the island says something positive about what kind of great power the PRC will be. A more aggressive approach, one that relies on pressure and intimidation, signals reason for concern about its broader intentions. In this regard, Taiwan is the canary in the East Asian coal mine.

A Slippery Slope?

Even if Taipei does not make a proactive strategic decision to appease Beijing, and even if Washington does not seek to curry Chinese favor by sacrificing Taiwan’s interests, there remains the possibility that Taiwan might undermine itself through inattention or neglect. That is, Taiwan might assume that Beijing’s intentions are so benign that it is prepared to accept some version of the status quo over the long term. Yet China has a different objective—ending Taiwan’s de facto independence more or less on its terms—and it may not have infinite patience. The danger is, therefore, that a frustrated China might seek to exploit the power asymmetry between the two sides of the Strait and intimidate Taiwan into accepting “an offer it can’t refuse.”

So what can Taiwan do to forestall that day? The first thing is to not create the impression in Beijing that the door on unification is closing forever—which Taiwan is currently doing. In addition, there are things it can do at the margin to strengthen itself and therefore increase the confidence needed to resist PRC pressure.

Economically, sustain the island’s competitiveness in shifting to a knowledge-based economy, and by liberalizing its economic ties with all its major trading partners, not just China. This will require eliminating some protectionist barriers, but the structural adjustment thus created will work to Taiwan’s benefit.
Politically, reform the political system so that it does a better job of addressing the real challenges that Taiwan faces (rather than focusing on relatively superficial issues).
Also politically, foster a clearer sense of what it means to say that Taiwan or the ROC is a sovereign entity, not just for its role in the international system but also regarding cross-Strait relations.
Militarily, enhance the deterrent capabilities of Taiwan’s armed forces in ways that raise the costs and uncertainties for Beijing if it were ever to mount an intimidation campaign.

None of these forms of self-strengthening will be easy. But they will buoy Taiwan’s psychological confidence and reduce the chances of PRC pressure in the first place.

Because the United States has an interest in China approaching its Taiwan “test case” in a constructive manner—that is, avoiding intimidation and accommodating Taiwan’s concerns—it should help Taiwan where it can to improve its odds. The most obvious ways are economically, by drawing Taiwan into the circle of high-quality liberalization, and militarily, by supporting innovative and cost-effective ways to enhance deterrence.

[1] Zbigniew Brzezinski, “Balancing the East, Upgrading the West: U.S. Grand Strategy in an Age of Upheaval,” Foreign Affairs, vol. 91 (January-February 2012), p. 103; Zbigniew Brzezinski, Strategic Vision: America and the Crisis of Global Power (New York: Basic Books, 2012), pp. 91–92, 177–78.

[2] Bill Owens, “America Must Start Treating China as a Friend,” Financial Times, November 17, 2009(www.ft.com/intl/cms/s/0/69241506-d3b2-11de-8caf-00144feabdc0.html#axzz1frbpHeLr; Chas W. Freeman, Jr., “Beijing, Washington, and the Shifting Balance of Prestige,” remarks to the China Maritime Studies Institute, Newport, R.I. May 10, 2011 (www.mepc.org/articles-commentary/speeches/beijing-washington-and-shifting-balance-prestige); Charles Glaser, “Will China’s Rise Lead to War? Why Realism Does Not Mean Pessimism,” Foreign Affairs, vol. 90, (March-April 2011), pp. 80–91; “A Way Ahead with China: Steering the Right Course with the Middle Kingdom,” recommendations from the Miller Center of Public Affairs Roundtable, Miller Center of Public Affairs, University of Virginia, March 2011 (millercenter.org/policy/chinaroundtable), pp. 24–25.

[3] Nadia Tsao, “Rohrabacher to Leave Taiwan Caucus position,” Taipei Times, March 15, 2009 (OSC CPP20090315968003).

[4] Bruce Gilley, “Not So Dire Straits: How Finlandization of Taiwan Benefits U.S. Security,” Foreign Affairs, vol. 89, no. 1 (January-February 2010), pp. 44–60.

[5] “Changing the Defense Strategy and Establishing Cross-Strait Military Confidence-Building Measures,” Wang Pao, November 30, 2012 (Open Source Center CPP20121201569001).

[6] Thomas G. Mahnken and others, “Asia in the Balance: Transforming U.S. Military Strategy in Asia,” American Enterprise Institute, June 2012, p. 11 (www.aei.org/files/2012/05/31/-asia-in-the-balance-transforming-us-military-strategy-in-asia_134736206767).

[7] And the fact that Taiwan is engaging China economically does not mean that it has abandoned its democratic values, just as the United States, which also employs a mixed strategy, has not.

[8] See, for example, Nancy Bernkopf Tucker and Bonnie Glaser, “Should the United States Abandon Taiwan?” Washington Quarterly, vol. 34 (Fall 2011), pp. 23–37; and Shelley Rigger, Why Taiwan Matters: Small Island, Global Powerhouse (Lanham, Md.: Rowman & Littlefield, 2011), especially pp. 187–98.

[9] See Richard C. Bush III, Perils of Proximity: China-Japan Security Relations (Washington, D.C.: Brookings Press, 2010)

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Richard C. Bush III

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Diplomatic Impetus and Altruistic Impulse: NGOs and the Expansion of Taiwan's International Space

Wei-chin Lee — Mon, 16 Jul 2012 00:00:00 -0400

When Taiwan’s President Ma Ying-jeou of the Nationalist Party (Kuomintang, KMT) succeeded former President Chen Shui-bian of the Democratic Progressive Party (DPP) in Taiwan’s democratic regime change in May 2008, it signaled some deep and profound shifts in Taiwan’s cross-Strait relations with the People’s Republic of China (PRC). Ma’s proclamation, in his first inaugural address, of “no unification, no independence, and no use of military force” under the “framework of the Republic of China Constitution” represented a departure from the cross-Strait policy of two former presidents, Lee Teng-hui (1988-2000) and Chen Shui-bian (2000-2008). Both former presidents’ politically charged and fiery rhetoric, and pursuit of elements of de jure statehood status for Taiwan, exacerbated China’s fear of Taiwan’s creeping but eventual split from the “Chinese motherland.” The Ma administration’s policies have helped increase cross-Strait exchanges in areas with low political tension, such as business transactions, tourism, and cultural visits.

However, the terrain of high politics remains full of sensitivity and controversy, and neither Taiwan nor China has healed as easily or in the same ways as in those arenas of low politics. For example, since 2008 President Ma has sought to take advantage of improved relations with China to expand Taiwan’s participation in inter-governmental organizations (IGOs). Although China has accepted the diplomatic truce for the time being, its unyielding adherence to its self-defined “one China” principle has continued to be an insurmountable barrier for Taiwan’s IGO participation.

Consequently, an active push for enthusiastic engagement in international activities through non-governmental organizations (NGOs) has surged as an alternative approach to the expansion of Taiwan’s international space. NGOs have long been cherished as an avenue through which Taiwan can navigate the turbulence of globalization, the rapid revolution of information technology, and the high degrees of complexity and interdependence in numerous transnational and interconnected issue areas across which various powers and interests compound and compete. By complementing the role and function of states, NGOs are an international venue for the representation and articulation of Taiwan’s public interest in areas such as the promotion of human rights, environmental sustainability, local community infrastructure construction, public health advancement, agricultural assistance, and humanitarian reliefs. They also represent an important forum in which Taiwan can share its experiences, learn from the experiences of others, and develop networks of connections.

The proliferation of Taiwanese NGOs stems from Taiwan’s democratization in late 1980s, the dwindling number of Taiwan’s IGO memberships, an increase of domestic social wealth, a desire to return favors to the international community for its previous good deeds to Taiwan, and human altruism. According to governmental registration records, currently there are more than 40,000 NGOs in Taiwan, and more than 2,000 of them have conducted cross-national activities or are affiliated with international NGOs (INGOs).[1] Firm commitment, specific missions, impartiality and independence in political stands, and budgetary efficiency have given some of Taiwan’s NGOs access to issue areas in which China has prevented Taiwan’s government from participating. Therefore, in order to help these cross-national NGOs’ work, and to augment Taiwan’s international participation and visibility without being bogged down by the political obstacles of Taiwan’s statehood status, Taiwan’s Ministry of Foreign Affairs (MOFA) set up a NGO Affairs Committee in October 2000.

Features of Taiwan’s Transnational NGOs

Taiwan’s NGOs exhibit several distinctive characteristics in their external endeavors.

A supplementary role for Taiwan’s diplomacy

While NGOs are usually autonomous and self-reliant in agenda setting and implementation, the government is eager to partner with NGOs by offering needed financial assistance and logistical support to NGOs to host international conferences in Taiwan or attend activities abroad. The government also authorizes specific NGOs to work in certain issue areas that are better tackled through unofficial channels. MOFA allocated US$ 12.7 million for NGO activities in 2008 with approximately three quarters of the budget slated for several major government-sponsored NGOs such as the Taiwan Foundation for Democracy (TFD) for parliamentary diplomacy, academic exchanges, and collaboration with foreign think thanks; and the Confederation of Asia-Pacific Chambers of Commerce and Industry (CACCI) for matters related to external business and trade.[2]

Thus, as an unofficial connection with other advanced democracies, the TFD actively participates in the World Forum for Democratization in Asia and the World Movement for Democracy, a global network initiated by the Washington, DC-based National Endowment for Democracy. The same applies to CACCI, which serves as a link to other national chambers of commerce in 27 Asian and Western Pacific countries and holds an NGO consultative status in the UN.

The rest of the MOFA budget for NGOs in 2008, more than US$ 3 million, helped facilitate cross-national engagement by other socially organized domestic and international NGOs.[3] In addition to hosting workshops and seminars for future NGO talents to learn more about the intricacies and operations of international NGOs in global affairs, MOFA has launched an annual program to sponsor several domestic NGO administrators for two-month self-sought internships at reputable international NGOs such as Mercy Corps and the American Council for Voluntary International Action (InterAction). The purpose is not only to acquire knowledge and gain experience, but also to broaden access to NGO transnational advocacy networks. The government-organized and -funded International Cooperation and Development Fund (TaiwanICDF) hosts workshops for both transnational and Taiwanese NGOs for multilateral exchanges of experiences and expertise. TaiwanICDF also works with domestic NGOs on a wide range of overseas development projects.

Naturally, encouragement and subsidies from public coffers raise concerns about NGOs’ independence and functional impartiality. Amazingly, in light of Taiwan’s lively and noisy media coverage and critical legislative scrutiny, there has been no report of serious governmental interference or impropriety in NGOs’ agenda setting or operational autonomy. Rather than directing and monitoring NGOs’ processes and behaviors, the government cares more about the diplomatic outcomes these NGOs could generate—enhanced status, image, and visibility in the international community of a compassionate, democratic, and pro-active Taiwan.

NGOs’ supplementary role in diplomacy is best illustrated by the campaign to end Taiwan’s exclusion from the global public health network through the World Health Organization. Taiwan’s inability to receive urgent international consultation and assistance during the 2003 SARS public health scare, a situation condemned by Taiwanese officials as “medical apartheid,” led public health NGOs such as the Foundation of Medical Professionals Alliance in Taiwan and the Taiwan International Medical Alliance (TIMA) to lobby consistently for years for Taiwan’s participation in the global health network. Along with the government, these health NGOs exerted pressure and highlighted the danger of excluding Taiwan from a globalized society in which transnational epidemic crises may occur. Taiwan was finally granted annual observer status in the World Health Assembly after Ma Ying-jeou’s election. Another example is in the area of climate change, an issue about which Taiwan’s government is deeply concerned. Government agencies were excluded from participation in the UN Conference on Sustainable Development (Rio+20) in Brazil in June 2012, so Taipei had to rely on domestic environmental NGOs, one of them nicknamed “Taiwan Action NGO” (TANGO), to represent Taiwan in the People’s Summit alongside the UN Conference.[4]

Altruistic impulses

A substantial majority of Taiwan’s socially-organized NGOs has focused on development assistance, poverty reduction, voluntary medical service, and humanitarian relief. Some well-known NGOs include: World Vision Taiwan, which operates a Child Sponsorship Program in 40 countries and 78 Area Development Programs in a number of countries, designed to raise standards of living over the long term; the Tzu Chi (Ciji) Foundation, for its extraordinary relief efforts in 70 countries; the Buddha’s Light International Association, which has a global reach and conducts relief work; the Taiwan Root Medical Peace Corps, with voluntary missions in numerous countries; and the Field Relief Agency of Taiwan, for aid specifically in Cambodia. Many began by addressing local and regional humanitarian needs due to geographic proximity, historical linkage, cultural affinity, and financial affordability have broadened their scope of service. Through the years, their large-scale systematic disaster relief operations have been well noted, as in the severe earthquake in China’s Sichuan province (2008), the combination of earthquake and tsunami disasters in Japan (2011), and the similar disaster in the Indian Ocean (2004). Following the Indian Ocean tsunami, when Taiwan’s official pledge of US$ 50 million (higher than the amount of either New Zealand or India) encountered difficulties in timely transport of relief goods because of recipient countries’ concerns over possible Chinese diplomatic protests, NGOs like Tzu Chi became a convenient, expedient channel of relief delivery.[5] In this case, NGOs perform as “the nexus of the global and the local,” free from international political constraints.[6] They serve as a societal response to Taiwan’s ambiguous non-nation/non-state status in the international community by expanding their global reach. “Time for Taiwan to feed back its love to the world,” a slogan of the Taiwan Root Medical Peace Corps, best captures these NGOs’ humanitarian missions and altruistic efforts. These NGOs’ altruistic activities have won widespread recognition and admiration.

NGOs as stealth cross-Strait peacemakers

With their presumptive neutrality in political orientation, some of Taiwan’s NGOs reach across the Taiwan Strait to conduct cultural exchanges, business advancement, and relief efforts. Despite the rise of a Taiwanese indigenous identity in recent decades, which has engendered occasional domestic criticisms against these Taiwanese “do-good” organizations for their non-governmental works in China, Taiwanese NGOs remain committed to their humanitarian efforts in China. At the same time, government-organized NGOs, such as the Prospect Foundation, have offered a non-governmental platform for political entrepreneurs and policy analysts from both sides to dialogue, explore the feasibility and impact of new ideas, converge mutual differences subtly, and minimize the possibilities of miscommunication. These government-organized NGOs also inform, explain, examine, and explore various issues of cross-Strait relations to other countries with interests and concerns.

The continuing challenge of nomenclature

Although the issue of statehood is less relevant to NGOs’ mission and functionality than it is for Taiwan’s participation in IGOs, China’s “one China” principle still constrains Taiwan NGOs from a full range of international participation. After the People’s Republic of China (PRC) replaced the Republic of China (ROC) in the UN, in 1973 Beijing requested that UNESCO notify all of its 319 affiliated NGOs to terminate any institutional linkage with Taiwan.[7] By July 1975, only 20 of the 37 International NGOs with institutional associations with Taiwan had replied, and an overwhelming majority of them flatly rejected the demand by arguing that political considerations should not interfere in the self-governing principle of non-political NGOs.[8] Surely, China’s adamant stance on its one China principle had become an obstacle to Taiwan’s international participation. However, the Taiwan government’s self-claimed representation of the whole of China during the two Chiangs’ era (Presidents Chiang Kai-shek and Chiang Ching-kuo) might have inhibited its chance for flexible diplomacy to better serve Taipei’s foreign policy interests then.

Even so, Taiwan has been pressured to accommodate to the new international reality. Taiwan boycotted the 1980 Winter Olympics in Lake Placid, New York in protest of a decision by the International Olympic Committee (IOC) that it could compete only under the name “Chinese Taipei”; in 1981 Taiwan accepted this name and has participated ever since. Another compromise was China’s adoption of “The China Association for Science and Technology, Beijing” and Taiwan’s acceptance of “The Academy of Sciences Located in Taipei, China” for both governments to participate in the International Council of Scientific Unions in 1982. In 1993, China further tightened its policy by permitting Taiwan’s international participation only under the name “Taipei, China” or “Taiwan, China,” both of which imply that Taiwan is a mere sub-unit within China’s political domain. Since then, the choice of proper nomenclature for Taiwan’s international participation has become a perennial cross-Strait issue; China sees this as an opportunity to block what it sees as attempts at “Taiwan independence,” and Taiwan refuses to be considered as a subjugated entity under China’s authority.[9]

Stated differently, despite the fact that NGOs are usually less controversial than IGOs in international participation, China also imposes harsh restrictions on name representation and participation for Taiwan’s transnational NGOs. Even as recently as March 2012, Taiwan’s NGO delegates with Taiwan IDs were prohibited from attending the session hosted by the UN Commission on the Status of Women until they improvised by showing foreign IDs to join the session.[10] In the 2010 Tokyo International Film Festival, a Chinese representative’s insistence that Taiwan’s delegation be placed under “Taiwan, China” quickly provoked a media sensation and public debates about China’s unreasonable demands in international non-political settings. Similar kinds of naming controversies have continued to occur in recent years.[11]

Implications and Suggestions

NGOs offer Taiwan visibility and a voice for diplomatic sustainability as well as a sense of dignity, respect, and self-worth for an associational life in the global community. Participation in them is an important part of Taiwan’s “huolu waijiao” (活路外交) or “flexible diplomacy.” They do represent a bit of a detour, as they are used in part to accomplish what the government is blocked from accomplishing in the world of IGOs. Active NGO participation is a bottom-up, gradualist, slow, and supplementary approach that can be accomplished without railing about sovereignty in a noisy manner. Conversely, international society can benefit from the expertise, compassion, and resources that Taiwan’s NGOs bring to the table. Also, frankly, engaging Taiwan in the NGO arena is a low-cost way for the international community to alleviate some criticisms about a democratic deficit and fairness deficit in global governance that result in part from the exclusion of Taiwan from so many international issue areas.[12]

Of course, in a world of power hierarchy and status asymmetry, Taiwan is unlikely to achieve a great leap forward in international participation by relying on its NGOs’ altruistic acts. Since President Ma’s calls for a diplomatic truce and expansion of Taiwan’s international space in 2008, by October 2011 Taiwan had become either a full member or an observer in five international organizations and four NGOs.[13] The record shows a slight improvement in the quantity of Taiwan’s international participation, but as noted above the naming controversy remains. More seriously, China continues to refuse to loosen its restrictions on Taiwan’s participation, even for NGOs; surely, one should not expect that China will make any concessions other than for self-interest and apparently Beijing does not yet perceive a reason to allow Taiwan to represent itself. Even in Taiwan, however, national identity remains a politically contested issue, and society has not reached consensus on a list of non-objectionable names for Taiwan’s IGO and NGO participation.

Even when NGOs operate in areas which are frequently the domain of states, they are not an effective substitute for the crucial role of state authority in multilateral diplomacy because states remain the legitimate authorities to arbitrate and resolve dispute. [14] However, NGOs’ positive impacts depend on the acceptance and appreciation of their “recipients.” The presumable political neutrality of NGO activities usually implies that the act is a goodwill gesture without political strings attached, and that there is no expectation of favors in return. This naturally undercuts the value of NGOs’ political influence in the overall achievement of Taiwan’s diplomacy.[15] Any political rewards for Taiwan’s offers of developmental assistance and humanitarian aid can only be rendered by recipients who have the will, capability, and autonomy to reciprocate in concrete political terms.

A survey of Taiwan’s past NGO practices shows some interesting implications for Taiwan to explore every available and favorable political opportunity in the future.

Continue NGO diplomacy

Regardless of the challenges, Taiwan should continue NGO diplomacy with its multilateral partners. In short, NGOs in themselves provide important public goods as they help identify and solve new global issues and strengthen the global public engagement apart from the system of states[16]; they also provide a crucial link for Taiwan’s local civil society with its international counterparts on a wide range of global issue areas related to Taiwan’s future sustainability and growth.[17] China’s usual assertion that Taiwanese people’s interests and welfare have been incorporated into China’s representation and articulation in the international society neglects the fact that Taiwan remains out of China’s governance, and thus China is unable to meet domestic needs in Taiwan. Nevertheless, China’s staunch subscription to its “one China” principle has rendered Taiwan’s IGO membership efforts a difficult challenge. Consequently, NGOs are a viable option for Taiwan to reach out for the supply and demand of global public goods. Conversely, the connection with transnational networks offers leverage to Taiwanese NGOs to be government watchdogs for policy improvement and to deepen Taiwan’s civil society and democracy.

Strengthen government’s NGO policy

With the multiplicity of NGOs in numbers, function, and operation, it has been a daunting task for Taiwan to realize full diplomatic benefits of the rise of NGOs at home and abroad. There is no “one-size-fits-all” formula for governmental NGO policy. It is also difficult to assess the impact of Taiwanese governmental assistance to domestic NGOs. As noted above, MOFA helps facilitate NGO administrator internships in international NGOs and supports workshops for NGO knowledge exchange and experience sharing. Whatever policy is adopted, the primary goal of any government NGO policy should be to help Taiwan NGOs navigate the dense webs of networks, interactions, and interrelations in an increasingly tight-knit global society well beyond the confines of sovereign states.

Expand cross-Strait NGO engagement

Taiwan should advocate for and expand the interaction of its government-organized NGOs and socially organized NGOs with their Chinese counterparts for further exchanges and collaboration in non-political areas. Although NGOs operating within China must avoid sensitive issues like human rights, they can serve as stealth agents for the diffusion of Taiwan’s democratic ideas, social values, and good governance in China. As predicted by functionalist integration theory, repeated bilateral interactions reinforce political commitments among elites across the Strait, cultivate shared principled values, and recalibrate mutual interests for spillover effects from low-politics issues to high-politics areas. Over time, quantitative changes in cross-Strait interactions may bring up some subtle qualitative transformation in perspectives and reciprocal relations. At a minimum, one wishes that NGO movements can quietly de-territorialize political barriers for the emergence of an institutional framework of stable peace across the Taiwan Strait, as envisioned by scholars like Kacowicz, Boulding and Deutsch.[18]

China must compromise

China can and should do more to minimize diplomatic discord over Taiwan’s international NGO participation and nomenclature. Following Taiwan’s active drive for an independent identity prior to 2008, Ma’s moves for peaceful reconciliation since 2008 and his explicit reconfirmation of “one ‘Republic of China,’ two areas” in his 2012 inaugural speech are significant steps in Taiwanese politics, which has been tormented by national identity division for decades, and fall within the spirit of the 1992 Consensus which China seems to hold as a baseline for reconciliation. China could consolidate Ma’s proclamations with positive reinforcements by actively accommodating Taiwan’s requests for more international space through IGO and NGO participation. In fact, Taiwan’s NGO approach is a risk-free opportunity for China. With its steadily increasing global prominence, China effectively holds quasi-veto power over any diplomatic attempt by Taiwan for sovereign recognition. As long as the representative title of Taiwanese NGOs does not seriously deviate from the apparent 1992 Consensus, China should take this golden opportunity to conceptualize, contextualize, and construct the broadly and loosely defined “one China” concept. China’s conciliatory move to loosen up the confines of “one China” in naming would help “self-educate” and socialize each side’s domestic constituencies and international audiences. Unnecessary disputes and disruption on the nomenclature issue will only add fuel to the fire of Taiwan’s domestic politics, and will simultaneously strengthen the uncompromising stand of Chinese nationalists and promote the continued suppression of Taiwanese NGOs in transnational forums. Moreover, China’s firm stand, its foreign ministry’s rigid interpretation and application of the “one China” principle, and the consequent denial of Taiwanese public aspirations for international participation do not help China win the hearts and minds of Taiwan’s citizens. Rather, China’s failure to adjust its “one China” principle simply perpetuates the tensions between the two sides.

If meaningful participation is the objective, both sides should reach a tacit understanding on a list of non-objectionable names for Taiwan’s international participation. In an asymmetric relationship, a feasible deal usually requires the strong party (i.e., China) to give extra latitude for a better chance to convince the weak party (i.e., Taiwan) to reach a solid institutional commitment because the strong party has abundant resources to spare and the weak party often harbors overwhelming fear of future losses in any institutional deal. The strong party’s concession signals a powerful commitment to be bound by an arrangement which may not be beneficial for the short term, but fruitful in the long run. China’s concessions in the recent Economic Cooperation Framework Agreement (ECFA) provide a useful example. A similar approach to Taiwan’s NGOs activities―and later IGO participation―can be quite appealing and may defuse anti-China opponents’ rhetorical power and sentiment in Taiwan and help Beijing win the hearts and minds of the Taiwanese people. China could also improve its global image as a benevolent power and pragmatic actor in regional and international affairs, which would in turn boost its constant aspiration for a “peaceful rise” in the world arena.

Fight the good fight

Finally, a successful NGO campaign requires acknowledgement and appreciation from international society. The restrictions placed on Taiwan’s international NGO participation literally deny Taiwan a salient societal voice and undercut the democratic mission of international institutions. The United States, other major powers, and INGOs could assist Taiwanese NGOs’ endeavors without affecting the implementation of their “one China” policies. While Taiwan’s NGOs have shown unwavering conviction, effort, and competence in humanitarian reliefs, it is about the time for the world to reciprocate the same to Taiwanese NGOs by giving them due recognition and a proper role to contribute to the international community without political obstacles.

[1] Shen Zewei, “Taiwan NGO kunjing zhong tui zhan waijiao”(Taiwan’s NGO efforts to expand diplomacy amid difficult circumstances), Nov. 8, 2010. <www.zaobao.com/special/china/Taiwan/pages13/taiwan101108.shtml>. As for the complexity of NGO categories, please see Bob Reinalda, “Private in Form, Public in Purpose: NGOs in International Relations Theory.” In Bas Arts, Math Noortmann, and Bob Reinalda, ed., Non-State Actors in International Relations, Aldershot, UK: Ashgate, 2001, 11-40. This study focuses primarily on Taiwanese NGOs with cross-national activities.

[2] Wu Jianguo, “Jiji fudao Taiwan NGO kuozhan guoji kongjian” (Actively Assist Taiwanese NGOs to Expand International Space), Xin shiji zhiku luntan (New Century Foundation Forum), no. 48, Dec. 30, 2009, 51-52. <www.taiwanncf.org.tw/ttforum/48/48-11.pdf>.

[3] Shen Zewei, “Taiwan NGO kunjing zhong tui zhan waijiao” (Taiwan’s NGO efforts to expand diplomacy amid difficult circumstances), Nov. 8, 2010. <www.zaobao.com/special/china/Taiwan/pages13/taiwan101108.shtml>; Wu Rongquan, “Woguo feizhengfu zuzhi guoji canyu zhi xiankuang yu zhanwang” (The current status and prospect of Taiwan’s NGOs’ international participation), March 19, 2012. <www.taiwanngo.tw/files/15-1000-16913,c104-1.php?Lang=zh-t>.

[4] “Taiwan TANGO tuan qianjin lianheguo yongxu fenghui” (Taiwanese TANGO team advances to UN Conference on Sustainable Development”, May 24, 2012. <www.taiwanngo.tw/files/15-1000-17407,c167-1.php?Lang=zh-tw>.

[5] Rhoda Margesson, “Indian Ocean Earthquake and Tsunami: Humanitarian Assistance and Relief Operations,” CRS Report for Congress, February 10, 2005, Order Code RL32715, CRS-3; “Indonesia: Tzu Chi Helps Tsunami Victims Fleeing Aceh to Medan,” December 31, 2004 <reliefweb.int/node/161588>. Other reports of Tzu Chi’s relief works in recent years can be found in <reliefweb.int/organization/tzu-chi>.

[6] C. Julia Huang, “Genealogies of NGO-ness: The Cultural Politics of a Global Buddhist Movement in Contemporary Taiwan.” Positions: East Asia Cultures Critique, 17(2), Fall 2009, 366.

[7] UNESCO, “Resolutions and Decisions Adopted by the Executive Board at Its 93^rd Session, Paris, 12 September-11 October 1973,” UNESCO Executive Board, 93 EX/Decisions, Paris, November 9, 1973, 40; UNESCO, “Report of the Director-General on the Application of 93 EX/Decision 6.9,” UNESCO Executive Board, 94 EX/33, Paris, February 20, 1974. Also see “Volume 1, Resolutions,” Records of the General Conference, Eighteenth Session, UNESCO, Paris, October 17 to November 23, 1974, p. 84.

[8] UNESCO, “The Question of International Non-Governmental Organizations Maintaining Relations with UNESCO and in Which Bodies or Elements Linked with Chiang Kai-shek Still Participate, Having Illegally Usurped the Name of China,” UNESCO Executive Board, 98 EX/20, Paris, August 29, 1975. NGOs’ refusal to follow UNESCO’s request also appeared in the 1976 UNESCO Director-General’s report to the Executive Board. Please see 100 EX/25 Paris, August 26, 1976.

[9] Semantic differences of nomenclatures signify various identity perspectives and political implications. For example, “Taiwan, China” and “Taipei, China” imply that Taiwan is part of China (the PRC). “Chinese Taipei” will be a better choice because the word “Chinese” carries a broader implication beyond politics, should Taiwan’s official title, “Republic of China,” be unattainable. Still, the translation of “Chinese Taipei” in Chinese should be “Zhonghua Taipei” (中華台北), not “Zhongguo Taipei” (中國台北), because the Chinese translation of “Zhongguo Taipei” still implies China’s authority over Taiwan. See David W. F. Huang, “Shitan liangan hejiexia Taiwan canyu guoji zuzhi zhi fali jichu” (Exploring the Legal Bases of Taiwan’s Participation in International Organizations in the Contest of 2008 Cross-Strait Rapprochement), Taiwan guojifa jikan (Taiwan International Law Quarterly), 5(4), 2008, 81-83.

[10] “Tai minjindang : zhonggong daya yi cong guanfang yanshen dao feizhengfu zuzi” (Taiwan’s Democratic Progressive Party: China’s suppression has extended from governmental organizations to NGOs), Radio Free Asia (Chinese), March 28, 2012. <www.rfa.org/mandarin/yataibaodao/mjg-03282012095152.html>.

[11] For instance, according to Taiwan’s Ministry of Foreign Affairs, there were 85 cases reported in 2010 for mislisting Taiwan’s NGO as China’s regional member in transnational NGO websites under Chinese NGO’s demand. <www.taiwanngo.tw/files/15-1000-6330,c88-1.php>.

[12] For a discussion of “fairness deficit,” please see Susan Marks, “Democracy and International Governance.” In The Legitimacy of International Organizations, ed. Jean-Marc Coicaud and Veijo Heiskanen, Tokyo and New York: United Nations University Press 2001, 47-68.

[13] According to Bonnie Glaser and Brittany Billingsley, Taiwan joined 6 additional international organizations by October 2011, though the website of Taiwan’s Ministry of Foreign Affairs in 2012 shows only five after 2008. See Taiwan’s Ministry of Foreign Affairs, <www.mofa.gov.tw/Official/Home/RelatedLink/?opno=be23c3a0-2e22-4fe3-b37c-3599074880f4> and Bonnie Glaser and Brittany Billingsley, Taiwan’s 2012 Presidential Elections and Cross-Strait Relations: Implications for the United States. A Report of the CSIS Freeman Chair in China Studies, Washington, DC; Center for Strategic and International Studies, November 2011, 3.

[14] Joel M. Podolny and Karen L. Page, “Network Forms of Organization.” Annual Review of Sociology, 24, 1998, 59.

[15] Alexander Cooley and James Ron, “The NGO Scramble: Organizational Insecurity and the Political Economy of Transnational Action.” International Security, 27 (1), 2002, 5-39.

[16] John Ruggie, “Reconstituting the Global Public Domain: Issues, Actors, and Practices.” European Journal of International Relations, 10, 2004, 499-531.

[17] Margaret Keck and Kathryn Sikkink, Activists beyond Borders: Advocacy Networks in International Politics. Ithaca, NY: Cornell University Press, 1998.

[18] Arjun Appadurai, Modernity at Large: Cultural Dimensions of Globalization, Minneapolis, MN: University of Minnesota Press, 1985, 188-189; Arie M. Kacowicz and Yaacov Bar-Siman-Tov, “Stable Peace: A Conceptual Framework,” in Arie Marcelo Kacowicz, Yaacov Bar-Siman-Tov, Ole Elgstrom, and Magnus Herneck, ed., Stable Peace Among Nations. Lanham, MD: Rowman and Littlefield, 2000, 11; Kenneth E. Boulding, Stable Peace. Austin, TX: University of Texas Press, 1978; Karl W. Deutsch, Political Community at the International Level. Salt Lake City, UT: ECKO House Publishing, 2006, first published in 1954.

Authors

Wei-chin Lee

Image Source: © Erik de Castro / Reuters

Taiwan’s UN Dilemma: To Be or Not to Be

Sigrid Winkler — Wed, 20 Jun 2012 00:00:00 -0400

Taiwan is not a member of the United Nations (UN) or its suborganizations, but it aspires to participate. China opposes this. It argues, correctly, that only sovereign states can enjoy membership in the UN; any state that manages to enter into the UN system as a full member in its own right is seen by the other member states as a fully-fledged independent country. China also claims Taiwan as part of its territory and denies that Taiwan is a sovereign state. China is adamant about preventing recognition of Taiwan as a sovereign state and its membership in the UN system. So far China has been successful in this endeavor. Membership – the highest form of participation – in the United Nations is inextricably linked with the question of sovereignty. Both China and Taiwan are highly aware of this problem, therefore for both sides the question of UN membership and other forms of participation for Taiwan has never lost its sensitivity. However, over time the nature of the question has changed: from a fight about which government – the People’s Republic of China (PRC) with its seat in Beijing or the Republic of China (ROC) with its capital in Taipei – was the sole legitimate representative of China in the world, it has since the early 1990s evolved into consideration of whether the UN would not be able to accommodate both in some way. While Taiwan, since the early 1990s, would favor such a solution, although not necessarily on the basis of full membership status, China adamantly refuses to move away from its position that Taiwan is part of China and thus cannot be represented on its own in the world’s most prestigious and important state-based international organization. China has the advantage in that it is a member of the United Nations, and is one of the five permanent members of the Security Council; it also enjoys increasing international clout outside the UN system.

This article looks into the past of Taiwan’s UN engagement leading to the end of its participation in 1971, traces the development of Taiwan’s UN campaign since 1993, and considers the prospects of Taiwan’s UN drive in the current relatively amiable climate in cross-Strait relations. It also sketches the links between Taiwan’s attempts to participate in the UN and their implications for its sovereignty.

1971 in the UN: What Was at Stake?

With the withdrawal of the ROC government from the Chinese Mainland to Taiwan starting from 1947 and the establishment of the PRC in Beijing in 1949, two rival governments claimed their status as the rightful international representative of China. Both followed a so-called “one China” policy, meaning that diplomatic relations with China by third parties could only be maintained with one of the two governments. The same was true for representation in international organizations, especially the UN. The question was therefore which government should represent China in the United Nations?

With the support of the United States, the ROC government of Chiang Kai-shek upheld its claim and retained the Chinese seat in the UN as well as its permanent seat in the UN Security Council for more than two more decades after its arrival in Taiwan. However, with an increasing number of countries choosing to recognize Beijing instead of Taipei, it was a battle against time, and Taiwan was on the losing side.

Dual representation, either as a divided country or even a two-China or two-state (one China, one Taiwan) solution, was on the table more than once during the years before the fateful UN General Assembly Resolution 2758 was passed in 1971. The United States in particular tried to broker a compromise, but without success. While Beijing was opposed to such solutions, Chiang Kai-shek was likewise inflexible in his claim that the ROC government was the legal representation of the whole of China. Chiang was particularly afraid that in a two-state solution he would lose the UN Security Council seat of China to the PRC, the enemy of the ROC. Chiang had already in 1961 for the first time put forward the infamous statement that “There is no room for patriots and traitors to live together” (hanzei bu liang li).[1]

However, in the beginning of the 1970s, the United States saw the geopolitical opportunity to move closer to China in a strategic move against their by then common adversary, the Soviet Union. The United States eventually broke formal relations with the ROC only in 1979, but the strategic shift in the early 1970s, combined with a large number of newly-independent former colonies that had some ideological solidarity with Beijing, turned the tide once and for all against Taipei. Still, it was a combination of Taipei and Beijing’s longstanding opposition to proposals for both PRC and ROC representation in the UN, together with the global strategic changes, that led to the end of the ROC representation in the UN, and in consequence also to the ROC’s expulsion from all other major international organizations.

When the crucial UN General Assembly resolution’s adoption seemed already unavoidable on 25 October 1971, the ROC delegation under orders of Chiang Kai-shek walked out of the UN to prevent further humiliation.[2] Resolution 2758 “to expel forthwith the representatives of Chiang Kai-shek from the place which they unlawfully occupy at the United Nations and in all the organizations related to it”[3] was adopted by 76 against 35 votes with 17 abstentions by the other UN members. The U.S. voted against the resolution, but was in a minority position,[4] and Taiwan found itself isolated and excluded from many international organizations – especially those affiliated with the United Nations.

Taiwan's UN Drive Since 1993

Lee Teng-hui took over as president of Taiwan in the late 1980s. He pursued “pragmatic diplomacy,” in which one strategy was maintaining Taiwan’s international existence through participation in various international and especially intergovernmental organizations. UN participation alongside China eventually became a viable policy option, even under continued rule by the Kuomintang (KMT), the Chinese Nationalist party.

Taiwan started its renewed UN campaign in 1993. The UN bids of 1993-1995 focused on the “[c]onsideration of the exceptional situation of the Republic of China in Taiwan in the international context, based on the principle of universality and in accordance with the established model of parallel representation of divided countries at the United Nations.”[5] This first approach aimed at establishing Taiwan as a sovereign state next to China, at least as long as no solution could be found between the two sides. It followed the model of divided states like East and West Germany or North and South Korea. However, China’s opposition, in combination with the “one China” policy of the majority of the UN member states, prevented the Taiwanese bids from even being treated properly in the UN. Apart from a few of Taiwan’s diplomatic allies, no country was ready to give consideration to Taiwanese representation in the UN.

Not having had any success in several consecutive years, in 1996 Taiwan attempted a new, vaguer and lower-profile approach by asking for the “[c]onsideration of the exceptional situation of the inability, resulting from General Assembly Resolution 2758 (XXVI), of the 21.3 million people on Taiwan, Republic of China, to participate in the activities of the United Nations.”[6] This approach did not necessarily target full membership, but rather focused on a right to representation and participation in imprecisely defined UN activities. The main argument was that the population of Taiwan could not be unfairly excluded from issues being dealt with in the UN only because of a conflict over sovereignty, while the Chinese government that claimed sovereignty over Taiwan’s territory was not involved in policy-making on Taiwan’s territory. This attempt also failed. China was not ready to yield even on more flexible terms of Taiwanese UN participation.

During the last years of the 1990s and in the beginning of the rule of the Democratic Progressive Party (DPP) starting in 2000, Taiwan’s strategy continued at a similarly low-profile level, stressing the right of the people of Taiwan to be represented in the UN without explicitly defining what kind of status Taiwan should have in the organization.

However, in 2007, Taiwan’s approach changed radically, by asking the UN to process its application for full membership. This new strategy did not leave any doubt that Taiwan, and not the Republic of China, wanted to have its sovereignty legitimized by becoming a new member of the United Nations. UN Secretary-General Ban Ki-moon refused to accept the application on the grounds that “[i]n accordance with [General Assembly Resolution 2758], the United Nations considers Taiwan for all purposes to be an integral part of the People’s Republic of China.”[7] Before this statement UN headquarters had been careful to remain vague on the issue of Taiwan’s status, but this statement opened a legal Pandora’s box, as it could be taken as the basis for the argument that China should be allowed to decide on matters concerning Taiwan in international organizations – which thus far had been avoided. Therefore, although Taiwan’s UN bid was frustrating even to its major international partner, the United States, Washington protested Secretary-General Ban’s statement, arguing that “while this assertion is consistent with the Chinese position, it is not universally held by UN member states, including the United States.”[8]

After this setback, the DPP called for a referendum on the issue of Taiwan’s UN membership in 2008, asking the people of Taiwan to vote on whether the government should apply for UN membership under the name “Taiwan,” therefore actually replicating the UN bid of 2007. This move was mainly regarded as a tactic in Taiwan’s 2008 presidential campaign, in which Taiwan’s international status and participation in international organizations were hotly discussed topics. The KMT therefore saw the need to follow suit by proposing a referendum of its own, however posing a much less controversial question. The KMT inquired among Taiwan’s voters, “Do you approve of applying to return to the United Nations and to join other international organizations under the name ‘Republic of China,’ or ‘Taiwan,’ or other name that is conducive to success and preserves our nation’s dignity?”[9] Both referenda failed to pass.

The issue of the two UN referenda in 2008 highlights that debates also continue on Taiwan’s domestic level about the fundamental objectives for Taiwan’s sovereignty to be reached through UN participation and what strategies should be employed to achieve these goals. At the same time this debate is largely decoupled from the international reality of chances for potential success. The viewpoints of the DPP and the KMT, especially under current President Ma Ying-jeou, differ fundamentally on what implications UN participation for Taiwan should have, how the entity is represented in the world, what amount of provocation toward China can be afforded in this question. Furthermore, these debates do not only take place on the level of political elites’ strategic international considerations, but activities such as the above referenda have also led to the politicization of the general public in Taiwan, coupled with attempts to instrumentalize this politicization for domestic political gains. The question of international participation has become increasingly complex in Taiwan.

Throughout these different efforts to participate in the UN, Taiwan’s government was aware that in reality its UN bids had only minimal chances for success due to China’s staunch opposition and the power it yielded in the UN to convince other members that there was no place for Taiwan in the state-based organization. Simply put, China feared that Taiwan’s participation in the UN would bring the island one decisive step closer to achieving independence. The undercurrent or open independence aspirations during the rules of Lee Teng-hui and Chen Shui-bian especially gave rise to such Chinese fears. In order to clarify that there is no space in the UN for an entity that constitutes a part or even a province of China, Beijing refused to leave any room for interpretation and also thwarted Taiwan’s more pragmatic approaches to the UN, let alone its bids for full membership. Only a handful of countries that still have diplomatic relations with the ROC challenged the Chinese perspective, while the rest of the member states and the organization followed China’s lead – either silently or in an outspoken manner.

Undeniably, for at least some in Taiwan, independence aspirations played a role in Taiwan’s early pragmatic UN approach although it stopped short of full membership. In this regard, looking at the situation from a Chinese perspective, China’s fears are understandable. Objectively speaking, however, China’s reluctance to accommodate solutions below the level of full membership is not necessarily justified. From the perspective of international law, observer status or flexible ways of pragmatic cooperation would not in any way improve Taiwan’s formal international status. Rather, such arrangements, while they allow for Taiwan to benefit from and contribute to the international system, would confirm the PRC view that Taiwan is not a sovereign entity.

According to Michael Kau, a former deputy minister of foreign affairs, the main aim of Taiwan’s UN campaign, beyond the futile desire that it could eventually achieve some form of participation in the organization, was to raise international attention to the issue of Taiwan’s unfair exclusion paired with the hope that maybe Taiwan would eventually be allowed to enter at least a number of functional UN agencies, such as the World Health Organization (WHO).[10] For this reason, Taiwan had already in 1997 started a parallel campaign targeting specifically the WHO, which was perceived as having a more realistic prospect for success. Taiwan’s UN bid has never even entered the UN General Assembly agenda, it never managed to get past the hurdle of the UN General Committee.[11]

It came as no surprise, given the differences between the DPP and the KMT on the question of UN participation, that in 2008, the new government of Ma Ying-jeou shifted Taiwan’s UN strategy, pursuing the clearly stated but undefined status of “meaningful participation” in UN specialized agencies, specifically the WHO, the International Civil Aviation Organization (ICAO) and the International Maritime Organization (IMO).[12] This new policy followed up on PRC President Hu Jintao’s announcement upon Ma’s inauguration as ROC president that “Taiwan compatriots’ participation in international activities would be discussed with priority given to participation of the World Health Organization's (WHO) activities after the cross-strait consultations were resumed.”[13] This effort resulted early on in observer status for Taiwan in the WHO’s World Health Assembly (WHA), the annual high-level meeting of the WHO. Since 2009, Taiwan has shifted its focus to the ICAO and the UN Framework Convention on Climate Change (UNFCCC),[14] but it has not yet achieved meaningful participation in these bodies.

WHO - A Success Story?

As early as 1997, the government of Taiwan launched its bid for participation in the WHO. Taiwan’s WHO strategy evolved over the years. Different avenues were explored, both in terms of name and status for Taiwan’s participation. Possibilities concerning status included Taiwan participating as an observer in the WHA, or the even less controversial “meaningful participation in WHO activities.” In 2002, Taiwan presented itself as a “health entity,” analogous to its status in a number of fisheries management organizations, where it could enter as a so-called “fishing entity.” Under Chen Shui-bian’s government, Taiwan applied for full WHO membership in 2007 and 2008. Not only did the status Taiwan aspired to have in the organization change over the years, Taiwan also altered its name designation, from “Republic of China” to “Taiwan” or combinations thereof as a reflection of the build-up of a Taiwanese identity and of how Taiwan’s government wanted to portray the island to the international community.

Certain events gave rise to the hope that Taiwan’s WHO bid could eventually be successful. The World Health Assembly, apart from long debates about the feasibility of Taiwan’s bids, held several votes on whether Taiwan’s attempts to apply for participation in the WHO should enter the WHA agenda. Just the fact that these votes took place represented a step further than Taiwan had managed to go in the UN system since 1971. But all of these votes – held in 1997, 2004, and 2007 – resulted in failure,[15] mainly due to Chinese opposition and because many other countries in the international system saw Taiwan as a trouble-maker with its continued bids.

The crisis caused by the outbreak of severe acute respiratory syndrome (SARS) in 2003, which spread to Taiwan, corroborated Taiwan’s claim that its exclusion from the WHO placed its population at particular risk in the case of a severe epidemic. Taiwan was third hardest hit by SARS – after China and Hong Kong[16] – but its calls to the WHO for help remained long unheard. Eventually, after Chinese consent,[17] the WHO sent several observers to the island. The SARS crisis induced the U.S. and Japan to support WHA observer status for Taiwan, while the European Union and Canada, for instance, called for flexible mechanisms for Taiwan’s participation in the organization’s activities.[18]

Therefore, SARS opened a window for direct contact between Taiwan and the WHO. However, in 2005, the WHO Secretariat and Beijing took the unconventional step of signing a secret Memorandum of Understanding (MOU) that elaborated the rules for such contact. Taiwan neither had a part in the negotiations of this MOU, nor was it ever informed about the exact contents of this document that determines its status in the WHO, though an implementation document outlining the specific rules was leaked.[19] The bottom line of this implementation document was that any interaction between Taiwan and the WHO, other than in a case of acute emergency, was subject not only to approval by the WHO Secretariat but also by the Chinese Ministry of Health in Beijing. Apart from leaving it to China to decide whenever Taiwan could enter into contact with the WHO and thereby putting Taiwan’s government into a place of de facto subordination to Beijing, the MOU also entailed long and cumbersome procedures which created administrative obstacles for Taiwan’s participation in WHO technical meetings and other interactions with the organization. The MOU has been guiding the relations between Taiwan and the WHO ever since.

Diplomatic cables leaked in 2011 on wikileaks show that the United States was supportive of the MOU while it was negotiated in 2005, perceiving it as a “step forward” in facilitating interaction between Taiwan and the WHO. In the negotiation process, the U.S. also tried to discourage protests from Taiwan over the terminology “Taiwan, China” used in the MOU and over the requirement for the WHO to notify the Chinese representation in Geneva before interacting with Taiwan. Furthermore the U.S. urged Taiwan not to make the MOU public in case it obtained a copy, as secrecy would be in Taiwan’s best interest.[20]

Following the inauguration of Ma Ying-jeou’s government in May 2008 and Hu Jintao’s overture on the issue of Taiwan’s participation in international organizations, a number of developments occurred in the WHO case in 2009. In January, Taiwan’s Centers for Disease Control (CDC) were invited to join the new WHO International Health Regulations (IHR), thus giving Taiwan access to updates about infectious diseases.[21] In May, Taiwan was eventually invited as an observer to the World Health Assembly. Preceding this invitation, Taiwan and China had held secret bilateral consultations about Taiwan’s WHO participation[22] – a first-time event in the framework of Taiwan’s attempts to accede to international organizations. Already in his inaugural speech in 2008, Ma Ying-jeou had announced his plans to “enter into consultations with Mainland China over Taiwan’s international space.”[23] The WHO talks were the first incident of such consultations. As a result of these talks, Taiwan was invited to observe the WHA as “Chinese Taipei,” which was subject to annual renewal. The invitation was issued explicitly to “Chinese Taipei’s” Minister and the Department of Health, but the address in the letter of invitation did not contain a country specification.[24]

Through this observership, Taiwan’s health ministers could address the WHA plenary,[25] and the health ministers from Taiwan and China used these occasions to meet personally on the sidelines of the WHA in 2009 and 2010[26] – all of these developments had been unprecedented before observership was achieved. In 2012, Taiwan was invited for the fourth consecutive year to observe the WHA, which was held in Geneva from May 21 to 26.[27]

However, the political opposition in Taiwan criticized this outcome, especially because in their interpretation the name “Chinese Taipei” did not portray Taiwan as a sovereign state, and also because the consultations between the governments of Beijing and Taipei could be interpreted as Taiwan asking for China’s permission.[28]

Further criticism has emerged since. Despite the achievements of WHA observer status and Taiwan’s inclusion in the IHR in January 2009, Taiwan’s experts were still excluded from many WHO technical meetings, while Taiwan was listed as “Taiwan, province of China” or “Taiwan, China” in official WHO documentation.[29] In May 2011, another internal WHO document was leaked in Taiwan, this time outlining how the WHO should treat Taiwan in the framework of the IHR.[30] In many respects this new document goes even farther than the 2005 MOU in curtailing Taiwan’s status and its rights for participation in the IHR.

This new memorandum on the “Procedures Concerning an Arrangement to Facilitate Implementation of the International Health Regulations (2005) with Respect to the Taiwan Province of China” was circulated within the WHO in September 2010, with an emphasis on distribution only “as needed,” while it should not fall into the hands of WHO outsiders.[31] This memorandum, which explicitly mentions WHO Director-General Margaret Chan’s wish that it should be fully and correctly implemented, is based on a so-called “IHR Arrangement” with respect to Taiwan’s IHR participation that the Permanent Mission of China in Geneva had communicated to the Director-General.[32] In other words, also in matters pertaining to Taiwan’s IHR participation, the WHO allowed China to dictate the ground rules for how the WHO had to arrange its contact with Taiwan. Considering that the current WHO Director-General, Margaret Chan, is from China’s Hong Kong Special Administrative Region, one is induced to speculate whether she is particularly receptive to such suggestions from Beijing.

Citing the resolution WHA25.1, which in 1972 expelled the ROC from the WHO, the 2010 memorandum emphasizes “the consequent obligation for the [WHO] Secretariat of refraining from actions which could constitute or be interpreted as recognition of a separate status of Taiwanese authorities and institutions from China.”[33] This provision constitutes Beijing’s bottom line for Taiwan’s participation in the IHR: in the WHO, for all purposes, Taiwan is part of China. Or rather, as the text specifies, the proper terminology to be used regarding Taiwan is “Taiwan Province of China.”[34]

With the official instruction to call Taiwan “Province of China,” this document even goes beyond Ban Ki-moon’s above statement, that for the UN, Taiwan is an integral part of the People’s Republic of China. Needless to say, for Taiwan, being called explicitly a province of China is an important setback in its WHO participation. The Taiwanese government launched an immediate protest to the WHO Secretariat. In addition to filing a formal protest letter with the WHO Secretariat, the Taiwanese Health Minister Chiu Wen-Ta also used his speech at the 2011 WHA to request the WHO to use the so-called “WHA model” for Taiwan’s general WHO participation.[35] This would essentially mean to stick to the wording “Chinese Taipei” for identifying Taiwan, and to refrain from presenting Taiwan and China as one entity in the WHO. In May 2012, Minister Chiu filed another letter with the WHO Secretariat to explain Taiwan’s stance on the name issue. So far, however, none of these attempts to urge the WHO to reconsider its policy toward Taiwan have received an official response.[36]

Related to the question of proper terminology is another provision in the IHR memorandum which states that, “Taiwan, as a province of China, cannot be party to the IHR.”[37] This may come as a surprise, as Taiwan’s CDC was officially included in the IHR. The WHO replied to this contradiction that, “‘Taiwan, China’ is part of the globally binding health regulations [author’s italics].”[38] The technical explanation appears to be that the IHR, as an international agreement, only knows states as contracting parties. Hence Taiwan cannot be a party. This does not prejudice the fact that Taiwan works with the IHR, therefore is part of it, to which even the 2010 memorandum pays testimony.

Finally, the IHR memorandum specifies that it only applies to matters concerning the implementation of the IHR, and refers to the 2005 Memorandum of Understanding for issues concerning Taiwan’s work in the WHO that are unrelated to the IHR.[39] This provision gives evidence that the restrictive framework of the earlier MOU is still in place, even after Taiwan was invited to the IHR and to observe the WHA. It may well be that this explains why the number of permissions granted to Taiwanese health experts to participate in WHO technical meetings remains conspicuously low. In interviews with the author, officials in Taiwan’s Department of Health and its Ministry of Foreign affairs refused to give clear responses on whether, in their opinions, the 2005 MOU is still valid.[40] Their official explanation was that since they had never actually seen the MOU, they were in no position to know whether it had been abandoned. However, it appears likely that an official admission that the much-criticized MOU is still in place, after the Taiwanese government has celebrated the success of joining the IHR and observing the WHA, would amount to a considerable loss of face.

According to statistics presented by Taiwanese health officials during an interview in November 2011, health experts from Taiwan applied for 16 technical meetings in 2010, but initially WHO headquarters granted permission for attendance at only four of these meetings. Taiwan’s health experts eventually managed to attend 10 of these activities, however, by using other channels for contact with the WHO: for instance by contacting the technical unit responsible for the meeting directly, instead of going through the WHO Secretariat.[41] According to Taiwanese newspaper reports citing a U.S. State Department report to Congress, in 2011, Taipei applied for 21 WHO working panels and technical activities. Approval was given in eight cases. Nine applications were rejected while the WHO did not respond to four applications.[42] Officials interviewed at the Department of Health saw the strict criteria pertaining to the level of expertise of invited participants as the reason for the WHO’s reluctance to grant permission to Taiwan’s health experts, rather than continued application of the MOU. The WHO’s time frame for answering requests from Taiwan remains long, but again the health officials in the interview put the blame on the generally busy schedules of the responsible WHO officials rather than on the MOU. They presented themselves as not aware that the WHO was still seeking consent from Beijing, while stating that after all, these were internal WHO procedures to which they did not have insight.[43]

In contrast, according to Peter Chang, former director-general of the Department of International Cooperation at Taiwan’s Ministry of Health, the MOU is still in place, which explains the problems Taiwan is facing in its participation in WHO technical meetings. With the MOU, Taiwan is disadvantaged in comparison to other observers in the organization in obtaining information and participating in meetings other than the WHA. A further explanation is, in his opinion, that since Taiwan has achieved extended WHO participation, for various reasons the issue ceased to be a priority in the agendas of both Taiwan’s Ministry of Foreign Affairs and the Ministry of Health and therefore its opportunities are not exhausted to their full potential. He claims, however, that Taiwan’s health experts are still active in a number of meetings, which are not organized by the WHO directly, but rather by individual countries or organizations in association with the WHO. The MOU was not able to control Taiwan’s participation in such events where Taiwanese participants had already been admitted before the MOU was established.[44]

What is Taiwan currently doing to overcome the constraints it is facing in its WHO participation due to China’s involvement? After the 2012 WHA, a statement by Health Minister Chiu surfaced, in which he claimed that “the Taiwan delegation is trying very hard to fight for a full membership of the WHO despite pressure from China.”[45] Taiwan has not given up its hope and desire to join the WHO as a full member at some point in the future. However, while this might be a long-term goal, the short- and mid-term focus lies on expanding Taiwan’s “meaningful and dignified participation” in the WHO. “Dignified” here highlights that Taiwan continues to fight against belittlement by terminology like “Taiwan Province of China,” while also protesting that in the IHR Authorized Ports List, the Taiwanese ports are listed under China.[46] At the same time it seeks the expansion of its meaningful participation to other WHO activities.[47] The United States joined Taiwan’s protest in the name dispute, advocating the use of “Chinese Taipei” instead of “Taiwan Province of China,” and showed itself supportive of expanding Taiwan’s meaningful participation in the WHO beyond the WHA and the IHR, for instance through Taiwan’s inclusion in the International Food Safety Authorities Network (INFOSAN).[48]

Does Taiwan have a Future in UN-Related Agencies?

The mixed results from Taiwan’s WHO participation raise the question of whether Taiwan’s other bids for UN-related specialized agencies will receive a positive answer in the near future. As Taiwan’s bids for meaningful participation in the ICAO and UNFCCC, modeled after Taiwan’s WHO participation, have already been on the agenda for several years, progress has yet been conspicuously absent. Taiwan’s participation in the UN, even in its functional sub-organizations, remains an international hot potato, and China does not appear ready to yield as long as Taiwan’s international status is not settled. Taiwan’s sovereignty will remain a core concern with respect to its UN participation.

Taiwan’s WHO campaign benefitted from a number of circumstances which eventually tilted the balance in Taiwan’s favor. Taiwan could claim, based on empirical evidence, that its exclusion from the WHO created a life threat for its population. This claim induced a number of countries, including the U.S., to step up their support for Taiwan’s participation, which was expressed toward both China and the organization itself. In the ICAO and UNFCCC, this argument is harder to make. Taiwan, based on its own domestic interests, is already a relatively responsible player in the matters addressed by these organizations, so not much obvious harm is done by leaving Taiwan excluded from the two bodies. If the organizations’ member states were to push hard for Taiwan’s participation, in contrast, they would only alienate China. In both organizations this would imply a substantial loss for the effective establishment of international rules and undermine the organizations’ goals. China is too important to be provoked.

Furthermore, China also used Taiwan’s WHO participation as an attempt to boost Ma Ying-jeou’s domestic popularity, who is by far the most attractive ROC president from a Chinese perspective. Beijing thought that granting WHA observership to Taiwan would increase support for Ma in the Taiwan electorate. After all, Beijing reasoned, he would have managed to achieve what his predecessors failed to do―give Taiwan a voice in a high-profile state-based international organization―and Taiwan’s voters should respect this achievement. However, it remains unclear whether Beijing anticipated all the repercussions its WHO concession would produce in Taiwan’s democratic society once the details of deal became known to the public, or whether the Ma government was aware of the terms China was to impose on the WHO with respect to Taiwan’s participation.

In any case, the WHO arrangements China dictated for Taiwan allow for conclusions about China’s current willingness to open up for Taiwan’s participation in the UN system. China will only be pushed to loosen its stance if there is an important level of international pressure to give Taiwan limited rights to take part in any specific UN agency. Yet, even then, China will not allow such participation to become a precedent to be emulated freely by other organizations. Furthermore, even when China consents to let Taiwan take part in certain organizations, it will dictate the framework of such participation, namely that Taiwan despite its presence is still a part, or even a province, of China. From Beijing’s viewpoint, Taiwan’s participation must not lead to the conclusion that Taiwan is a sovereign state independent from China, and for that reason China feels entitled to yield the penultimate power of decision of how much participation is granted to Taiwan and acts accordingly. As the WHO case shows, international governmental organizations are ready to comply with such Chinese demands.

China does have other, more accommodating options available, which it could pursue if it changes its legal theory on the implications for Taiwan’s international status for methods of UN participation short of membership. Such a policy change would require from China’s side more confidence about the long-term intentions of Taiwan’s leaders (such as no independence, and no “two Chinas”). Moreover, China would need to realize that it is only hurting prospects for achieving its fundamental objective by alienating Taiwan and its voters through its heavy-handed approach to UN organizations.

As noted above, Taiwan’s current drive for meaningful participation in the UNFCCC and the ICAO remains low-profile. In 2010, Taiwan tried to formally apply for observer status in the UNFCCC, but has not submitted an application to ICAO; its UNFCCC application was rejected with reference to the UN General Assembly resolution 2758. Since then, Taiwan has concentrated on an issue-oriented approach, by attempting to participate in side events or public meetings of both organizations in order to make a positive contribution through sharing Taiwanese expertise and experience. This issue-oriented approach is intended to familiarize the organizations with Taiwan’s presence and to prove that Taiwan is willing to work positively on the international level. The main aim is therefore to create some momentum in the international community that would lead to positive reactions by the organization and its member states, if and when Taiwan eventually submits formal applications for observer status again.[49]

The government in Taipei currently does not engage in consultations with Beijing on its participation in international organizations, while Beijing continues to openly reject the possibility of expanding Taiwan’s presence in international organizations.[50] However, the question remains as to how much momentum Taiwan is actually able to generate as long as China remains opposed to any expansion of Taiwan’s participation in the UN system. In other words, how likely is it that other members of the organizations in question will support Taiwan, if China opposes Taiwan’s participation? Furthermore, Taiwan’s pragmatic and issue-oriented approach inadvertently proves that it already has the means to take part in some activities of the organizations, albeit on the lowest possible level. This could potentially discourage international pressure to accommodate Taiwan’s rights to participation. Finally, even if China were to consent to an expanded Taiwanese participation in UN specialized agencies, it is equally questionable whether Taiwan’s government would again agree to a deal with Beijing after the disillusioning experience of its WHO participation.

Therefore, further progress in Taiwan’s agenda to take part in functional UN specialized agencies will remain an open issue in the future, dependent on the outcome of a settlement of the question of Taiwan’s status. When and how the question of Taiwan’s status will be resolved is impossible to predict at this point in time. Ongoing cross-Strait talks have not yet touched upon the issue of sovereignty, nor will they in the foreseeable future. For the time being, Taiwan will have to make the best out of its participation in the UN system and show that it is able to work constructively with the UN’s specialized agencies, while a combination of active opposition from China and inertia in the international community continue to block its aspirations for a formal expansion of its participation.

[1] Richard C. Bush, At Cross Purposes: U.S.-Taiwan Relations Since 1942 (Armonk, N.Y.: M. E. Sharpe, 2004), 103–117.

[2] Dennis V. Hickey, Foreign Policy Making in Taiwan: From Principles to Pragmatism (Abingdon, Oxon: Routledge, 2007), 11.

[3] UN General Assembly, “Resolution 2758 (XXIV),” October 25, 1971.

[4] Walter Rosenberger and Tobin, eds., Keesing’s Contemporary Archives: Weekly Diary of Important World Events, vol. XVIII (Bristol: Keesing’s Publication Limited, 1971), 24943.

[5] Information retrieved from the Ministry of Foreign Affairs, Republic of China (Taiwan).

[6] Ibid.

[7] John J. Tkacik Jr., “Taiwan’s Status Remains ‘Unsettled’,” Heritage Foundation, October 1, 2007, http://www.heritage.org/press/commentary/ed101607e.cfm.

[8] Ibid.

[9] Government Information Office, Republic of China, “March 22, 2008 Presidential Election and Referendums - Press Kit: Fact Sheet No. 6,” n.d., http://www.gio.gov.tw/elect2008/kit_06.htm.

[10] “Interview with Michael Kau, Former Deputy Foreign Minister, Republic of China (Taiwan), Taipei Taiwan,” April 20, 2012; also see: Chien-pin Li, “Taiwan’s Participation in Inter-governmental Organizations: An Overview of Its Initiatives,” Asian Survey 46, no. 4 (2006): 611.

[11] Pat Gao, “The UN Bid Goes On,” Taiwan Review 57, no. 10 (October 1, 2007), http://taiwanreview.nat.gov.tw/ct.asp?xitem=24693&CtNode=128.

[12] United Nations General Assembly, “Request for the Inclusion of a Supplementary Item in the Agenda of the Sixty-third Session: Need to Examine the Fundamental Rights of the 23 Million People of the Republic of China (Taiwan) to Participate Meaningfully in the Activities of the United Nations Specialized Agencies, A/63/194,” August 22, 2008, 194.

[13] “Hu Says Opportunity for Cross-Strait Relations Should Be Cherished,” Xinhua.net, May 28, 2008, http://news.xinhuanet.com/english/2008-05/28/content_8272634.htm.

[14] Ministry of Foreign Affairs, Republic of China (Taiwan), “政府決定推動有意義參與「聯合國氣候變化綱要公約」 (UNFCCC) 「國際民航組織」(ICAO)，外交部籲請各國支持,” September 21, 2009, http://www.mofa.gov.tw/webapp/content.asp?cuItem=39793&mp=1.

[15] WHA, “Fiftieth World Health Assembly, Provisional Verbatim Record of the Third Plenary Meeting, A50/VR/3”, May 5, 1997, esp. 6 and 21–22; WHA, “Fifty-seventh World Health Assembly, Second Plenary Meeting, A57/VR/2,” May 17, 2004, esp. 40–42; WHA, “Sixtieth World Health Assembly, Second Plenary Meeting, A60/VR/2,” May 14, 2007, esp. 104–106.

[16] Susan Maloney, Babatunde Olowokure, and Cathy Roth, “Taiwan, China: From Control to Outbreak,” in SARS: How a Global Epidemic Was Stopped, ed. WHO Western Pacific Region (Geneva: World Health Organization, 2006), 109–112.

[17] Dennis V. Hickey, “The High Cost of Excluding Taiwan from the WHO,” in China’s Rise, Taiwan’s Dilemma and International Peace, ed. Edward Friedman (Abingdon, Oxon: Routledge, 2006), 73.

[18] WHA, “Fifty-seventh World Health Assembly, Second Plenary Meeting, A57/VR/2,” 32–33 and 42–43.

[19] WHO, “Implementation of the Memorandum of Understanding Between the WHO Secretariat and China”, July 12, 2005.

[20] Hsiu-chuan Shih, “Cables show US’ role in WHO-China MOU,” Taipei Times, September 12, 2011, 1.

[21] Ellen Ko, “Island to Join Health Alert System,” Taiwan Journal XXVI, no. 5 (2009), http://taiwanjournal.nat.gov.tw/ct.asp?xItem=47654&CtNode=122.

[22] Yan-chih Mo, “Taipei, Beijing to Discuss WHA, Ma Says,” Taipei Times, March 14, 2009, 1.

[23] Ma Ying-jeou, “Full text of President Ma’s Inaugural Address: Taiwan’s Renaissance,” The China Post, May 21, 2008, http://www.chinapost.com.tw/taiwan/national/national%20news/2008/05/21/157332/Full-text.htm

[24] WHO, “World Health Assembly (WHA) Letter of Invitation,” in A Century of Resilient Tradition: Exhibition of the Republic of China’s Diplomatic Archives, ed. National Palace Museum, Taiwan (Taipei: National Palace Museum, 2011), 254.

[25] Ching-chuan Yeh, “The 4-minute Speech of Minister Yeh at a Plenary Session of the 62nd World Health Assembly, 19 May 2009,” Department of Health, Executive Yuan, R.O.C. (Taiwan), May 26, 2009, http://www.doh.gov.tw/EN2006/DM/DM2_p01.aspx?class_no=387&now_fod_list_no=9073&level_no=1&doc_no=71564; Chih-Liang Yaung, “Statement by Dr. Yuang (sic) at 63th (sic) WHA,” Ministry of Foreign Affairs, Republic of China (Taiwan), May 18, 2010, http://www.mofa.gov.tw/Organizations/News/Detail/a0555ca9-5029-46e4-b1d6-8064d0c52988?arfid=3ea175ea-0f1d-497b-81ec-40d17e8a33ab; “Health Minister Chiu Urges WHO to Adopt ‘WHA Model’,” Government Information Office, May 20, 2011, http://www.gio.gov.tw/ct.asp?xItem=89350&ctNode=2463&mp=807; “Taiwan Delegation Returns from Fruitful WHA,” Taiwan Today, May 28, 2012, http://www.taiwantoday.tw/ct.asp?xitem=191319&CtNode=414.

[26] Y.C. Jou, Ching-fang Chen, and Sofia Wu, “Taiwan, China Health Ministers Meet at WHA,” The China Post, May 19, 2009, http://www.chinapost.com.tw/taiwan/china-taiwan-relations/2009/05/19/208788/Taiwan%2DChina.htm; “Taiwan, mainland China health ministers meet at WHA,” Taiwan Today, May 18, 2010, http://taiwantoday.tw/ct.asp?xitem=103536&CtNode=414.

[27] “WHA Observer Status Pays Global Dividends,” Taiwan Today, April 22, 2012, http://taiwantoday.tw/ct.asp?xItem=189512&ctNode=425.

[28] For instance: Jimmy Chuang, Flora Wang, and Shelley Huang, “Protesters Defend Taiwan Sovereignty at WHA Meet,” Taipei Times, May 20, 2009, 1.

[29] Formosan Association for Public Affairs, “World Health Assembly: More Form Than Substance,” Taiwan Communiqué 128 (July 2010): 14–15; Chris Wang and Hsiu-chuan Shih, “WHO’s Terminology Like a ‘slap’: DPP,” Taipei Times, September 21, 2011, 1.

[30] Vincent Y. Chao, Hsiu-chuan Shih, and Shelley Huang, “WHO memo sparks outrage in Taiwan,” Taipei Times, May 10, 2011, 1.

[31] WHO, “Memorandum: Procedures Concerning an Arrangement to Facilitate Implementation of the International Health Regulations (2005) with Respect to the Taiwan Province of China,” September 14, 2010, esp. p. 1 and Art. 3, http://www.scribd.com/doc/57152017/WHO-Memo-on-Taiwan-Status.

[32] Ibid., p. 1 and Art. 1

[33] Ibid., Art. 4

[34] Ibid., Art. 13

[35] Government Information Office, “Health Minister Chiu urges WHO to adopt ‘WHA model’,” May 20, 2011, http://www.gio.gov.tw/ct.asp?xItem=89350&ctNode=2463&mp=807.

[36] “Taiwan again urges WHO over name designation,” The China Post, May 25, 2012, http://www.chinapost.com.tw/taiwan/foreign-affairs/2012/05/25/342213/p1/Taiwan-again.htm.

[37] WHO, “Memorandum: Procedures Concerning an Arrangement to Facilitate Implementation of the International Health Regulations (2005) with Respect to the Taiwan Province of China,” September 14, 2010, Art. 14

[38] Vincent Y. Chao, “Memo says Taiwan not a party to the IHR,” Taipei Times, May 10, 2011, p. 3.

[39] Ibid., Art. 5.

[40] “Interview with Officials at the Department of Health R.O.C. (Taiwan), Taipei, Taiwan,” November 16, 2011; “Interview with Officials at the Ministry of Foreign Affairs, Republic of China (Taiwan), Taipei, Taiwan,” June 6, 2012.

[41] “Interview with Officials at the Department of Health R.O.C. (Taiwan), Taipei, Taiwan,” November 16, 2011.

[42] Hsiu-chuan Shih, “US questions WHO’s name for Taiwan,” Taipei Times, May 18, 2012, 1.

[43] “Interview with Officials at the Department of Health R.O.C. (Taiwan), Taipei, Taiwan,” November 16, 2011.

[44] “Interview with Peter Chang, Professor and Vice-Dean, Department of Public Health and Nutrition, Taipei Medical University, Former Director-General of the Department of International Cooperation, Ministry of Health, Taipei, Taiwan,” April 16, 2012.

[45] “This year’s WHA represents diplomatic victory for Taiwan,” Want China Times, June 1, 2012, http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20120601000002&cid=1501.

[46] See: WHO, “IHR Authorized Ports List,” April 24, 2012, http://www.who.int/ihr/training/ihr_authorized_ports_list.pdf, 23-30.

[47] “Interview with Officials at the Ministry of Foreign Affairs, Republic of China (Taiwan), Taipei, Taiwan,” June 6, 2012.

[48] Hsiu-chuan Shih, “US questions WHO’s name for Taiwan,” Taipei Times, May 18, 2012, 1.

[49] “Interview with Officials at the Ministry of Foreign Affairs, Republic of China (Taiwan), Taipei, Taiwan,” June 6, 2012.

[50] Ibid.

Authors

Sigrid Winkler

Public Diplomacy in Northeast Asia: A Comparative Perspective

Wed, 30 May 2012 10:00:00 -0400

Event Information

May 30, 2012
10:00 AM - 12:00 PM EDT

Saul/Zilkha Rooms
Brookings Institution
1775 Massachusetts Avenue NW
Washington, DC 20036

On May 30, the Center for Northeast Asian Policy Studies (CNAPS) at Brookings hosted a discussion examining the use of public diplomacy in Northeast Asia. Leading experts discussed the objectives, practices, opportunities and challenges in public diplomacy for China, Japan, South Korea and Taiwan.

Panelists addressed the history of public diplomacy in each country, how it is defined and the societal and governmental structures under which public diplomacy is practiced. They also discussed the public diplomacy goals and practices of each nation, offering suggestions for the enhancement of public diplomacy.

After the program, speakers took audience questions.

Audio

Public Diplomacy in Northeast Asia: A Comparative Perspective

Transcript

Transcript (.pdf)

Event Materials

20120530 public diplomacy northeast asia transcript

Participants

Panelists

Kwei-Bo Huang

Visiting Fellow

Changjian Jiang

Visiting Scholar, Weatherhead East Asia Institute, Columbia University
Associate Professor, Department of International Politics, Fudan University

Stephen Noerper

Senior Vice President

Nancy Snow (via video feed)

Fulbright Professor, Sophia University, Tokyo
Professor of Communications, California State University, Fullerton

Craig Hayden

Assistant Professor, School of International Service

Adam Clayton Powell III

Senior Fellow, Center on Communication Leadership and Policy and University Fellow USC Center on Public Diplomacy

Taiwan’s Maturing Democracy

Mon, 14 May 2012 09:00:00 -0400

Event Information

May 14, 2012
9:00 AM - 4:00 PM EDT

Falk Auditorium
Brookings Institution
1775 Massachusetts Avenue, N.W.
Washington, DC 20036

On May 14, the Center for Northeast Asian Policy Studies (CNAPS) at Brookings and the Center on Democracy, Development, and the Rule of Law (CDDRL) at Stanford University hosted a seminar analyzing progress and challenges in the consolidation of Taiwan’s democratization and reforms. While the presidential and legislative elections held on January 14 were interpreted by many as proof that Taiwan’s democratic system—including its government and society—has matured since the first transition of political power in 2000, both big-picture and day-to-day challenges to effective democratic governance remain.

The seminar featured leading practitioners and political scientists from Taiwan and the United States. Panelists examined reforms that have been enacted in Taiwan over the past decade, and analyzed their impact on the functions of government agencies, political parties, and other non-governmental organizations. They also discussed how reform and consolidation are affecting policy and public perception of the system.

After each panel, speakers took audience questions.

Transcript

Transcript (.pdf)

Event Materials

Participants

Panelists

David Brown

Adjunct Professor, Paul H. Nitze School of Advanced International Studies

Nigel N.T. Li

Adjunct Professor, Graduate School of Law, Soochow University
Adjunct Professor, Graduate Institute of Political Science, National Taiwan University

Da-Chi Liao

Professor of Political Science

Jiunn-rong Yeh

Professor, College of Law

John Fuh-sheng Hsieh

Professor of Political Science

Shelley Rigger

Brown Professor of East Asian Politics Chair, Department of Political Science

Erich Che-wei Shih

News Anchor and Show Host

Eric Chen-hua Yu

Assistant Professor of Political Science

Richard C. Bush

Larry Diamond

Professor of Political Science; Director, Center on Democracy, Development, and the Rule of Law

Alan Romberg

Distinguished Fellow and Director, East Asia Program

Ho Szu-yin

Professor, Department of Political Science

Taiwan’s Public Diplomacy at a Time of Institutional Change

Kwei-Bo Huang — Thu, 10 May 2012 00:00:00 -0400

Following a long period of tension in cross-Taiwan Strait relations, an impression has developed that Taiwan and mainland China are moving closer together. President Ma Ying-jeou declared in 2008, early in his first term, that Taiwan would undertake a “diplomatic truce,” under the policy of “flexible diplomacy,” with mainland China. At the dawn of such a mutually accommodated cross-strait relationship, public diplomacy, which is either “government-to-people” or “people-to-people with government support” in nature, appears to be an increasingly important foreign policy tool for Taiwan.

Public diplomacy can be implemented as a cluster of measures that are more productive than the confrontational steps such as “checkbook diplomacy,” in which Taipei and Beijing competed for formal diplomatic partners. In the new atmosphere, rather than spending financial resources and political capital wooing foreign governments with development deals, through successful public diplomacy Taipei can increase the understanding of Taiwan among the general publics of a larger range of countries and thereby generate a significant amount of goodwill.

For instance, Taiwan can highlight its preservation of genuine Chinese culture and its achievements in national development, and can add to a variety of exchanges between Taiwan’s and the other countries’ civil societies. This will not only save resources, but will also avoid the creation and escalation of new diplomatic conflicts that destabilize the region or even the world.

Public diplomacy should also include a feasible effort to educate and train Taiwan’s diplomats to be better listeners and storytellers, in order to connect with foreign people and advocate the interests of Taiwan in an appropriate way.

The goal of public diplomacy, which is based mostly on soft power, is to present an accurate picture of where Taiwan is and where it’s going. This is a difficult challenge for any country, but it is made even more difficult for Taiwan, particularly in the short run, because of the ongoing changes in the structure of Taiwan’s central government and the institutions responsible for Taiwan’s external image.

Integration of Agencies

The merger of two major implementers of Taiwan’s public diplomacy―the Ministry of Foreign Affairs (MoFA) and the Government Information Office (GIO)―on May 20, 2012, the beginning of President Ma Ying-jeou’s second term, denotes a dramatic change in Taiwan’s diplomacy. Specifically, GIO will dissolve on that day, but its international information and communication programs will continue to function and will be moved to MoFA in September 2012. MoFA will create two units, a Department of International Communication and a Coordination Council for Public Diplomacy, to meet the demands of a well-planned public diplomacy agenda. The former will be a formal unit of MoFA like the other traditional geography-based departments, while the latter is seen as a formal unit by MoFA, but as a task force by the Directorate-General of Personnel Administration of the Executive Yuan. These units will be headed by directors–general. Institutionally and traditionally, a vice or deputy minister of foreign affairs will supervise these units. It is very likely that the Department of International Communication will be run by former GIO officials, and the Coordination Council for Public Diplomacy by officials of MoFA’s Department of Information and Cultural Affairs, which will also be dissolved in May or September.

The merger is part of President Ma’s continuing strategy to reform the executive branch of the central government, which was seriously discussed not long after he took office in 2008. Not only did President Ma discuss and propose changes, he has also sought to implement them. The law defining the structure of the executive branch, the Executive Yuan (EY), had not been amended since 1949, when the Republic of China government withdrew to Taiwan. To enhance administrative efficiency, to streamline this huge and out-of-date government machine, to cope with the challenges of globalization, to strengthen Taiwan’s international competitiveness, and to foster more interaction between government and civil society, the Ma administration gained overwhelming support from the Legislative Yuan and passed several new laws for this giant and complicated project that should have been carried out long time ago.

After May 20, there will be only 14 ministries, 8 councils, and 7 other agencies at the same level under the EY, in comparison with a total of 37 before the modification. For a variety of reasons, GIO was not transformed into an independent agency in charge of international information and communication. As a consequence, GIO has to be formally dissolved with its international information and communication–related tasks folding into MoFA.

Emerging Problems

This change has perhaps reminded some people of the case of the integration of the United States Information Agency (USIA) into the U.S. Department of State (DOS) in 1999, based on the Foreign Affairs Reform and Restructuring Act of 1998, as well as the Omnibus Consolidated and Emergency Supplemental Appropriations Act of 1999. USIA was commonly seen as the key agency in charge of U.S. public diplomacy. After 1999, USIA’s missions merged largely with the DOS’s Bureau of International Information Programs and Bureau of Educational and Cultural Affairs, both supervised by Undersecretary for Public Diplomacy and Public Affairs. Supporters of this merger maintained that it would create a higher degree of policy integration in the realm of public diplomacy. Opponents argued that the morale of USIA officials was low mainly because they were ignored after the end of the Cold War and because USIA’s tasks were not taken seriously by DOS which viewed the conducts of foreign policy programs in a different way. In other words, the problem was not the structure, but the distribution of resources and authority.

It is thus reasonable to expect that the consolidation of major public diplomacy organizations in Taiwan will create problems similar to those experienced in the United States, or in any restructuring of a bureaucracy. It would be surprising if such a major change did not face evident difficulties along the way.

First, there is the bureaucratic challenge of melding two agencies that have common but differentiated core tasks. GIO has pursued international information and communication programs overseas, while MoFA’s core tasks – different aspects of conventional diplomacy with foreign partners – vary. After the merger, officials tasked with pursuing these various objectives may be under more pressure to identify one goal and speak with one voice, if there is no effective mechanism of task integration and strategic planning and coordination. (GIO officials in charge of domestic affairs will be sent to the Executive Yuan or the Ministry of Cultural Affairs.)

Second, continuous leadership changes for GIO since the second term of former President Lee Teng-hui – the agency has seen sixteen leaders in seventeen years – have disrupted its consistency, diminished its influence, and to a certain extent weakened its capacity to act in the international arena. This puts GIO officials, and their priorities and programs, at a potential disadvantage as they are folded into MoFA. Former GIO officials could face an uphill battle if they want to maintain their “repertoires” and resources or sometimes even dictate final outcomes like before.

All public diplomacy programs, whether they have in the past been run by GIO or MoFA, will be under the supervision of one of the three deputy and vice ministers of foreign affairs who may or may not be familiar with the essence and practice of public diplomacy. Without the “key person” – the head of GIO who has been at the minister level – who speaks for the planning and execution of a public diplomacy program preferred by GIO officials, it is uncertain whether officials with GIO’s perspective and expertise will be able to remain influential. Whether MoFA’s nascent Department of International Communication, which will include former GIO officials and which will be responsible for international information and communication programs, is able to carry out its tasks without too much bureaucratic interference from above is very crucial for Taiwan’s public diplomacy.

Third, there is the very human challenge of trying to integrate two bureaucracies with different working cultures. Despite the fact that GIO’s international information and communication staff and MoFA staff are both dealing mostly with foreigners, their work cultures can be very different―which is a reflection of their different missions and objectives. It is generally believed that, in comparison with MoFA, GIO is less concerned about formality, makes decisions less hierarchically, and encourages greater creativity at work. It is thus understandable that the morale and drive of GIO officials that could be impacted need to be taken care of during the transition. A soft landing for GIO’s international information and communication programs will help foster a positive environment for the continued integration of the two agencies’ public diplomacy programs.

Last, but not least, the knowledge and awareness of public diplomacy are not yet sufficient to develop and carry out a more modern and integrated public diplomacy program for Taiwan. By training, Most GIO and MoFA officials are not properly equipped with the necessary knowledge and techniques of public diplomacy that are closely associated with public relations, such as branding/marketing, cross-cultural communication, and social media. This is simply because the government has not made available intense and systematic professional training for the cultivation of “new public diplomats.”

Public diplomacy has five basic methods, i.e., listening, advocacy, exchange programs, cultural diplomacy, and international broadcasting. In practice, GIO pays a great deal of attention to international broadcasting and advocacy through physical or electronic magazines/newsletters and some social media. Its international exchange programs have been limited largely to foreign journalists and policy experts or professors. MoFA focuses more on exchange diplomacy and advocacy through an array of official and non-official channels. Credit for cultural diplomacy has been claimed by both GIO and MoFA, but in fact there is still a long way to go, with properly designed cultural diplomacy programs that are not simply one-off activities. Listening appears to be the public diplomacy method rarely undertaken by either GIO or MoFA. Taiwan’s public diplomacy programs will remain significantly hindered by these problems even though the merger puts most of GIO’s public diplomacy-related missions, people, and resources under the leadership of MoFA.

The Importance of Coordinated Public Diplomacy

Public diplomacy is especially important for Taiwan, as it is restrained from conducting normal diplomatic relations with most foreign governments. Effective public diplomacy will help Taiwan open up more valuable opportunities that both facilitate and diversify the “flexible diplomacy” embraced by the Ma administration. With better integrated public diplomacy programs Taiwan will be able to carry out nation branding that makes sure the targeted foreign audience can understand and accept Taiwan more. Accordingly, creating a proper institutional framework aimed at the afore-mentioned objectives is very urgent and important.

It seems that the top leadership in Taiwan has understood clearly that public diplomacy is important but has not sensed the consequences of potential problems, either existing or emerging, once GIO’s international programs begin to merge with MoFA. MoFA will have to collaborate with the Overseas Chinese Affairs Commission, the Ministry of Education, the new Ministry of Cultural Affairs, and other to launch appropriate public diplomacy programs worldwide. Reconfiguring and reengineering its public diplomacy programs will become one of the urgent tasks for MoFA in the near future. Otherwise, the integration of GIO’s international information and communication programs into MoFA would not be a helpful way to improve Taiwan’s public diplomacy.

Authors

Kwei-Bo Huang

Image Source: Nicky Loh / Reuters

Ma Ying-jeou’s Second Term and Taiwan’s International Participation

Zhe Sun — Tue, 08 May 2012 00:00:00 -0400

Three issues are currently at the forefront of thinking about contemporary relations across the Taiwan Strait: international participation for Taiwan; economic engagements enabled by the 2009 Economic Cooperation Framework Agreement (ECFA); and political dialogue leading to a peace accord. While both the mainland and Taiwan agree to continue working on ECFA and thereby enhancing levels of economic cooperation, they do have different views on the other two issues. From the mainland perspective, the most urgent task is not to push Taiwan for political dialogue, rather, it has to face up the continued requests made by Taiwan on its international participation. Beijing is fully aware that this is a highly sensitive and disputed issue and that any “dodging” or mishandling by the mainland might hurt the people of Taiwan and drive Taiwan away from unification.

International participation for Taiwan is an open, ongoing process which involves many issue areas, ranging from Taiwan maintaining diplomatic relations with its formal partners to participation in United Nations activities to Taiwan’s joining global and regional economic organizations and signing bilateral free trade and economic agreements with other countries.[1] To simplify, there are five dimensions to Taiwan’s international participation: (1) cooperation with those countries having formal diplomatic relations with Taiwan; (2) cooperation with countries that do not have formal diplomatic relations with; (3) bidding for UN membership and participation in UN-affiliated organizations or activities; (4) participation in intergovernmental organizations (IGOs); and (5) participation of non-governmental organizations (NGOs).

At the end of March 2012, following Ma Ying-jeou’s election victory for a second term, Taiwan maintained formal diplomatic relations with 23 countries; had memberships in 32 IGOs (the most well known include the WTO, APEC and ADB); and another 22 quasi-memberships.[2] It is also estimated that about 2185 NGOs in Taiwan have kept up regular participation in international NGOs’ events and other international conferences and activities in social, economic, cultural areas.[3]

In Ma’s first term, Taiwan announced a “diplomatic truce” policy in which he decided to stop competition with the mainland for formal diplomatic partners, and he intentionally gave up bidding for formal UN membership. But still, as cross-strait relations continue to improve, Taiwan would reasonably hope to achieve some “breakthrough” in each of the other four dimensions of its international participation, including developing informal relations with other states; obtaining some form of participation in UN-affiliated agencies; participating in more inter-governmental organizations; and expanding and consolidating its substantial participation in non-governmental organizations.

Perhaps Taiwan’s most notable effort to enhance its international position in recent years has been to seek to participate in two specific United Nations organizations: the International Civil Aviation Organization (ICAO) and the UN Framework Convention on Climate Change (UNFCCC). Mr. Wu Den-yih raised this question when he met Chinese Vice Premier Li Keqiang at the BoAo Forum for Asia in April 2012. Taipei argued that participation in these organizations would defend “the rights and interests of its people” and forge “friendships with other nations and develop initiatives that benefit the world at large.”[4] It would also build up new venues for high level leaders across the Strait to meet regularly and exchange their views on international affairs. This last point is not inconsequential or unrealistic. Chinese President Hu Jintao and former KMT Chairman Lien Chan have had several exchanges in APEC meetings. In the WHA, the health ministers of both sides have met, something that is not possible in a bilateral context.

Still, many political figures in Taiwan have complained about the mainland preventing Taiwan from participating in international events. In 2008, shortly after Ma announced his “diplomatic truce” policy, Tsai Ing-wen, then chairwoman of the Democratic Progressive Party (DPP), criticized the policy as “narrow minded” and characterized his overall approach to cross-strait relations as “reckless.”[5] She also pointed out the mainland’s bullying behavior and “suppression” of Taiwan. Su Chi, a KMT policy leader, voiced his complaint in a more positive way, pointing out that the mainland should consider the question of Taiwan’s participation in NGOs, especially as this issue is easier to handle than the sovereignty question. Furthermore, respecting Taiwan’s demands here would eventually contribute to the development of cross-strait relations.[6]

Beijing responded positively on those complains but called for more discussions on terms and conditions, implying that a solution cannot give rise to “two Chinas” or “one China, one Taiwan.” Beijing has its own concerns and tactics.

First, there is no doubt that the mainland will be firm on its “one China principle,” making no compromise on the sovereignty issue. Nonetheless, Beijing also acknowledged that cross-strait relations went well during Ma’s first term, so it suggested that the two sides should try their best to avoid having direct confrontation on this matter.

Why is Beijing so sensitive and insistent on this “one China principle”? From the mainland’s point of view, the issue of Taiwan’s participation in international activities, especially those under the auspices of the United Nations, was settled after the passage in 1971 of United Nations Resolution 2758, “Restoration of the Lawful Rights of the People’s Republic of China in the United Nations.” Taiwan’s international participation, no matter in what form, has always been considered as a political problem reflecting the legitimate representation of China in the international community.

Also, Beijing learned a lesson in fighting against separatist forces in Taiwan during the Lee Teng-hui and Chen Shui-bian periods (1988-2000 and 2000-2008). When Lee Teng-hui became the leader of Taiwan in 1988, he publicly stated that the basic policy of Taiwan was that “there is only one China, not two.” However, beginning in the early 1990s, Lee gradually deviated from the “one China principle” and began to provide support for the separatists. Chen Shui-bian, who succeeded Lee, helped the rapid development of the “Taiwan independence” forces and the spread of the “Taiwan independence” ideology. Their effort in carrying out the activities for “expanding the international space of survival” was considered by mainland China as aimed at creating “two Chinas.”

Fighting against international “separatist forces” has never ended even after Ma won the election in 2008. At the beginning of Ma’s first term, the U.S. Mission to the United Nations released a statement saying, “The United States has long supported meaningful participation for Taiwan in these specialized agencies [of the United Nations], including in the World Health Organization (WHO).”[7] In 2009, 15 UN member countries supported Taiwan’s participation in UN special agencies. From the mainland’s point of view, such statements represent “meddling in Chinese domestic affairs.”

Comparatively speaking, Beijing actually worries more about the probing activities by Taiwan with non-formal partners and some IGOs than it does about such foreign interference. To some extent, Ma’s “diplomatic truce” only sought to prevent the mainland from taking away more small countries from Taiwan. While only 23 countries have formal diplomatic relations with Taiwan, and because the mainland can effectively block Taiwan from membership in UN agencies, Taiwan has established substantial business and commercial offices in more than 120 other countries. Indeed, Taiwan has been very aggressive in seeking to improve the substance of its relationships with many of these countries. Taiwan’s efforts include seeking to elevate representative offices into embassy- or consulate-level offices; to display “national flags” at international conferences and events; and to request high level political honors and courteous receptions during transit. Economically, the mainland also worries that Taiwan has tried to improve its political status through economic engagement with the United States, Japan, the European Union, and Singapore and other ASEAN countries. Taiwan’s international visibility has strengthened its political and economic contacts with other countries. Helping Taiwan improve its international reputation and enhancing its visibility might lead to a bitter result for Beijing: with Taiwan’s gaining of more confidence and international recognition, will Taiwan’s self-identity be strengthened? If so, a weakening of Taiwan’s connection to “one China” would create a strategic dilemma for Beijing.

To express this thought in a different way, the mainland is willing to help Taiwan to “share international honor” under the condition of the one China principle. However, the mainland is aware that Taiwan has developed its own perception of the world and, thus, Beijing needs to be fully alert to Taiwan’s long-term ambition of joining the UN and its agencies. Beijing may help Taiwan become a member or get access to some UN agencies, such as the WHO, for now, and to the IMF and World Bank in the future. But it would also try to deliberately curtail Taiwan’s possibilities to become a normal member of the international community or a full-fledged international actor. That is to say, Beijing is willing to pay more attention to the negative public sentiment on Taiwan about being excluded from international society, but it hopes that helping expand “Taiwan’s international space” would further stabilize the cross strait relations and build up mutual trust for political dialogue – it should not drive Taiwan and the mainland farther apart.

The “Six-Points” proposition to Taiwan, made by Chinese President Hu Jintao on December 31, 2008, clearly states that he understands the issue and general public sentiments in Taiwan. The mainland government is willing to allow “Taiwan's 'reasonable' participation in global organizations.”[8]

Can the two sides work out new deals on international participation in Ma’s second term? Are there mutually acceptable ways that China and Taipei can defuse potential tension over this issue? The underlying issue for the two sides to work out is specific terms or formulas for Taiwan.

Right now, at the IGO level, Taiwan uses four names: Chinese Taipei (Taipei, China or Taiwan, China); Taiwan; ROC; and other names such as “Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu.”[9] In the future, Ma’s top preference would be “Republic of China” or “Taiwan,” while his lowest preference would be “Chinese Taipei.”[10] From the mainland’s point of view, there are technical difficulties in working out the right “identities” for Taiwan. ROC and Taiwan are not acceptable; Chinese Taipei or other arrangements might be discussed. For example, Taiwan wants to gain observer status at ICAO and UNFCCC in the near future. Both organizations, however, are UN-associated specialized agencies, and membership is, in principle, based on UN membership.[11] From November 1971, China has been represented within the ICAO by the Government of the PRC. Special arrangements must be made to invite Taiwan to participate. The Charters need to be revised or special arrangements need to be made to allow Taiwan to participate, most likely as an observer.

In the past, the mainland and Taiwan have compromised and worked out some deals regarding Taiwan’s participation in IGOs. For example, the mainland helped Taiwan join the WTO Government Procurement Agreement (GPA) in 2008. In the same year, Taiwan also participated in APEC and the WHA.

In Ma’s second term, it seems that neither side can impose its will on the other, so it is highly unlikely that Taiwan can use the names “ROC” or “Taiwan” to participate international IGOs or NGOs. Although Beijing would not see Taiwan’s observership as a serious threat to the “one China principle,” it does not want to offer too much compromise to Taiwan too soon. The underlying political calculation is that Beijing does not want to lose political control and put itself into an awkward position of having to perform a synchronized swimming routine with Taiwan every time it brings up the international space issue. In this sense, Beijing simply can not get rid of the specter of Taiwan’s permanent separation – even if it is only an informal separation, and not de jure, separation.

It seems that the best approach for Taiwan’s international participation would be tacit cooperation on specific organization(s) first, and then negotiated cooperation on a larger scale participation.

If the two sides work closely, Taiwan may follow the APEC formula (Taiwan joined in 1991 under the name of Chinese Taipei) and work out a deal at the Pacific Economic Cooperation Council (PECC). It may follow the WHA model (which it joined under special invitation) and join UNESCO, the UN Food and Agriculture Organization (UNFAO) and the UN International Maritime Organization (UNIMO). Or, it may follow the WTO model (which it joined under the name of “Separate Customs Territory of Taiwan, Penghu, Kinmen, and Matsu” which was also used by Taiwan to join GATT in 1992) and join more IGOs in the future.

The views expressed in this article are those of the author. The Brookings Institution does not have an institutional viewpoint on any policy issue.

[1] Yu Xintian, Taiwan’s Expanding International Space Reconsidered, internet resource: http://cn.chinareviewnews.com/doc/1009/0/1/9/, visited March 20, 2012.

[2] Taiwan is an observing member of 16 IGOs, an associate member of two IGOs (CGPM, 2002, GBIF, 2001), a corresponding member of one IGO (OIML1997), and a cooperating non-member of one IGO (ICCAT1972). See internet resource at: http://www.mofa.gov.tw/Official/Home/InternationalOrg/?opno=e5d5cd5d-fc61-468f-957b-ffa7f7c5dcc3; visited March 25, 2012.

[3] Wu Rongquan, “ROC International Participation in NGOs: Current Situation and Perspectives,” (吳榮泉: 我國非政府組織國際參與之現況與展望), http://www.taiwanngo.tw/files/15-1000-16913,c104-1.php?Lang=zh-tw; visited May 4, 2012.

[4] Government Information Office, “Participation in International Bodies,” http://www.taiwan.gov.tw/ct.asp?xItem=44620&ctNode=1922&mp=999, visited March 25, 2012.

[5] Rich Chang, “Tsai warns against Ma’s diplomacy policy,” Taipei Times, August 10, 2008, http://www.taipeitimes.com/News/taiwan/archives/2008/08/10/2003419938, visited May 4, 2012.

[6] Zhang Yongtai, “Post Election Issues: Taiwan’s International Space,” (选后议题: 台湾国际空间), Voice of America, January 20, 2012, http://www.voanews.com/chinese/news/20120120-REACTIONS-ON-TAIWAN-137745658.html, visited April 2, 2012.

[7] American Institute in Taiwan, “Statement on Taiwan's Meaningful Participation in UN Specialized Agencies,” United States Mission to the United Nations, September 17, 2008, http://www.ait.org.tw/en/officialtext-ot0812.html, visited May 4, 2012.

[8] Chinese and English versions of the speech can be found at http://wenku.baidu.com/view/b2d870d8a58da0116c1749ff.html.

[9] Chinese Taipei is used in APEC and ADB; Taiwan in AAEA (1998) and Egmont Group (1998); ROC in APO (1961), AARDO (1968), FFTC/ASPAC (1970), CABEI (1992), and ASCA (1994); special entity in WTO (2002), ICN (2001), and AITIC (2008).

[10] “Cross Strait Consensus: Taiwan as an Observer Participates in WHA,” Chinese Review, April 13, 2009, http://www.chinareviewnews.com; visited April 5, 2012.

[11] On ICAO, see e.g. H. Volger, “ICAO – International Civil Aviation Organization,” in H. Volger (ed.), A Concise Encyclopedia of the United Nations (2002), 274-275; K. Hailbronner, International Civil Aviation Organization, in: R. Bernhardt (ed.), Encyclopedia of Public International Law, vol. II (1995), 1070-1074. Talmon, Stefan A. G., The Recognition of the Chinese Government and the Convention on International Civil Aviation. Chinese Journal of International Law, Vol. 8, No. 1, 2009; Oxford Legal Studies Research Paper No. 1/2009. Available at SSRN: http://ssrn.com/abstract=1325180.

Authors

Zhe Sun

Image Source: Nicky Loh / Reuters

Taiwan in the Global Economic Landscape

Mignonne Man-jung Chan — Mon, 12 Mar 2012 16:15:00 -0400

INTRODUCTION

Ma Ying-jeou won a second four-year term as president of Taiwan in January 2012, with 51.6 percent of the votes cast in the election. This result signifies, among other things, a solid endorsement of President Ma’s first-term leadership of navigating through challenges of economic stress and natural disasters in the midst of global crises. As a trading nation―and lacking the formal political relationships of most nations―active participation in the international economy is especially important to Taiwan. This article aims (1) to examine the current state of play of Taiwan’s global economic participation; (2) to evaluate the strengths, weaknesses, opportunities, and threats Taiwan is now facing; and (3) to propose a “maxi-min” approach to enhancing Taiwan’s role in the world.

Global Efforts to Promote Economic Growth and Sustainable Development

In order to ensure economic security in a turbulent and interconnected world, a measured dose of liberalization is essential. Taiwan, like other economies, must act quickly to keep up with emerging trends, but must also undertake prudent cost-benefit analysis. On the one hand, the innovative competitiveness of the private sector must not be stifled; on the other hand, the public sector must promote economic growth and social equity by formulating comprehensive policies, including structural reform, lest changing circumstances or external shocks work to our detriment. In a globalized world, economies will neither be spared the ripple effects of others, nor can they escape the responsibilities of being a stakeholder in the global community.

The Ma Ying-jeou administration has identified six emerging industries in Taiwan―namely biotech, eco-tourism, green energy, medical and healthcare, organic farming, and cultural innovation―for which the government and private enterprises are seeking to boost competitiveness through a variety of means such as innovation and branding. In addition, four intelligence industries are to be promoted―cloud computing, smart electronic automobiles, IPR commercialization, and smart green buildings. The government plans to develop new visions and forward-looking policies in these industries. Development in these areas will forge structural change for economic growth, which will in turn contribute to the much-needed innovative and sustainable growth.

But these efforts to strengthen certain key industries could not exist in a vacuum, and interaction with the outside world is necessary. As late as 2009, Taiwan faced at least four specific external challenges to its competitiveness: (1) a relative lack of institutionalized trading mechanisms with mainland China, which is Taiwan’s neighbor, the home of more and more of its manufacturing, and a giant potential market; (2) the volatile financial situations and depressed economic climate in the United States and Europe; (3) a lack of free trade agreements with most economies; and (4) perceived political opposition from China to establishing such agreements with third parties.

In order to solve or mitigate these challenges, and to both enhance opportunities for near-term trade and boost mid-term international competitiveness, the Ma administration pursued an Economic Cooperation Framework Agreement (ECFA) with China. The ECFA was signed on June 29, 2009 and became effective as of September 12 of that year. The Early Harvest provisions are to be completed in three years starting in January 2010; China is removing tariffs on more than 500 products from Taiwan to the benefit of the island’s bicycle, petrochemicals and machinery industries. China will cut import tariffs on $13.84 billion worth of items including petrochemicals and vehicle parts, and Taiwan will cut tariffs on $3 billion worth of goods including parts for baby strollers and bicycles, and raw materials for textiles. This year more segments of ECFA, including goods and services, investment protection and dispute settlement are in the pipeline for further negotiation. Open sky (for air transport liberalization) and cloud valley (for high-tech information network clustering) are also identified as items of future collaboration.

Taiwan has been actively seeking bilateral economic cooperation pacts with other like-minded partners, including a revival of Trade and Investment Framework Agreement (TIFA) talks with the United States and a possible FTA with the European Union (termed as Trade Enhancement Measures by the European Chamber of Commerce). Sequentially, Singapore and Taiwan have initiated the negotiation of ASTEP (Agreement of Singapore-Taiwan Economic Partnership). Japan and Taiwan signed a landmark investment pact in September 2011. Feasibility studies on cooperation or partnership agreements with the potential partners of the Philippines, Indonesia, and India are now being undertaken. Other economies in the region, notably South Korea, are pursuing and implementing trade liberalization agreements; if Taiwan is excluded from broader regional economic integration, trade and investment will be diverted away from it.

Tables 1 and 2, below, illustrate Taiwan’s changing trade and investment portfolios with key partners and reflect the shifting global economic landscape.

Since 2002 Taiwan has also increased its international economic participation in multilateral fora, complementing the bilateral efforts noted above. In APEC, Taiwan has made great strides in collaborating on initiatives in Emergency Preparedness, Paperless Trade, and Crisis Management Center for Small & Medium Enterprises. Furthermore, public-private joint partnership has been highlighted by Taiwan’s initiation and participation in projects such as the Supply-chain Connectivity Framework and the Food Emergency Response Initiative.

In the World Trade Organization, Taiwan acceded to the Government Procurement Agreement in 2009. It continues to work and find ways to promote next-generation issues, including a potential extended Information Technology Agreement (known as ITA2), and regulatory cooperation. Taiwan’s commitment to a successful conclusion of the Doha Development Round remains firm and it stands ready to share its development experiences with emerging and developing economies.

Challenges Ahead for Taiwan: A SWOT Analysis

Strengths: Competitiveness, Competence, and Policy Mix

President Ma has put forth his vision of a Golden Decade featuring innovative approaches to stimulate economic growth and sustain competiveness. President Ma’s re-election and the KMT majority in the Legislative Yuan should increase the chances for policy reform and development, and initial signs are encouraging. Reputable international rating agencies, including IMD, WEF and BERI, have rendered high rankings for Taiwan’s competitiveness and network readiness for the year 2011. President Ma’s new Cabinet lineup, announced after the January 2012 election, is composed of prominent technocrats with financial and technological expertise who will be expected to steer Taiwan through the ripple effects of global financial storms.

The Ma administration has provided the foundation for prosperity and stability with continuous liberalization and cross-strait policies designed to benefit Taiwan. ECFA and 16 other agreements have institutionalized cross-strait economic relations, and reversed the harmful trend of run-away businesses and capital flight. Stability and mutual prosperity – not only across the Taiwan Strait, but in the region as well – will be mutually reinforcing.

President Ma’s cross-strait policy rubric of “sideline confrontations, create win-win situations” has taken us as far as the implementation of the Early Harvest provisions in ECFA. ECFA could well serve as catalyst for deepening regional economic integration, intensify the regional supply chains, and contribute to regional peace and prosperity.

Weakness: Politics

Taiwan’s domestic politics, as in many countries, could easily disrupt an otherwise rational policy choice—a case in point was the U.S. beef import case that has flared up in 2009 and continues today. After much deliberation and nearly 12 months of field investigations, research on international health standards, inter-agency coordination, and public outreach, a U.S.-Taiwan beef import agreement was signed in 2009. However, given the partisan atmosphere that prevailed at the time in the run-up to Taiwan’s municipal elections, the Legislative Yuan weakened the agreement with an amendment to limit the scope of import.

But this uncertainty though is no more severe than the fact that the U.S. president’s trade promotion authority has not yet been extended by the U.S. Congress, nor is it more dangerous than the farmers’ riots in South Korea and Japan. A solution to the beef impasse – which continues to hold up other advances in Taiwan-U.S. trade relations – will require mutual understanding and concerted efforts in consensus building.

Opportunities: ECFA as Catalyst to Regional Integration

While Asia continues to be the engine of global economic growth, Mainland China’s 12th Five-Year Plan (2011-2015) highlighted that nation’s attempts to ease the double-digit growth and avoid over-heating, open more domestic markets, and enhance the services industry. Taiwan's “golden decade” blueprint (2011-2020) has some overlapping interests and both sides seem ready to further improve economic cooperation and seek common development and prosperity.

The value of ECFA as a catalyst for regional harmony and prosperity is most evident when Taiwan’s global official and non-official partners expressed their welcome sentiments after the inking of ECFA, including Singapore, Japan, the E.U. and the U.S. It was dubbed a “landmark,” with value of the pact extending beyond the immediate economic cooperation between Taiwan and China. Foreign chambers of commerce were pleased with the reduction of business transaction costs, and the potential for a wider scope of operation. The win-win-win potentials are enormous and are firing the imaginations of entrepreneurs and business executives. Integration rhythms of vertical, horizontal and criss-cross sorts are being widely explored at an unprecedented tempo.

Indeed, ECFA helped create a sense of urgency in the regional business community about speedier efforts in forging integration, such as South Korea’s call for faster negotiation with early harvest of sorts to avoid losing competitive advantages, and the U.S. urge for reviving TIFA (Trade & Investment Framework Agreement with Taiwan). ECFA will not only dissipate the risk of Taiwan being marginalized – a threat Taiwan faced as regional integration began to take place without it – but will also bring about sequential economic linkages with other economies in the region. ECFA will add much value to regional integration via vertical and horizontal integrations of regional and global supply chains. The stakes of ensuring the stability of economic linkages will in turns strengthen incentives for regional collaboration in facilitating ease of flows for goods, services, manpower, and technology.

ECFA will facilitate more cross-strait exchanges and collaboration in capital, work force, management style, technological innovation, and business culture, and hence could contribute to transforming mainland China into a milder, not tougher, hegemony.

As President Obama has made remarks supporting increased economic ties and reduced tension across the Strait, and is committed to providing Taiwan with most of the needed defense capability, the U.S. is playing an indispensable role in ensuring that the resurging China continue to be a responsible stakeholder. This balancing act of engaging and putting a check on the mainland China is not only good for Taiwan, but also good for the mainland. In each and every step of the paradigm shift, the emerging multilateral world should see a more harmonious international system, a much better structured world and a more humane approach to integration.

Taiwan could well serve as a catalyst for Mainland China’s evolving development. It may be constructive as a reference point in the creation and strengthening of the various fabrics of political, legal, economic, social and cultural development in China. As the world’s 18th largest economy and a creditable guardian of Chinese traditional culture, Taiwan has much to offer in the wake of global re-balancing and structural reform in her own right.

So far, the world has appreciated Taiwan’s aspiration to extend the benefits of ECFA and the peace dividend to others by joining other regional and global international organizations. As a trading island, Taiwan is well geared for exploring integration schemes, such as ASEAN + X, the Trans Pacific Partnership, the International Civil Aviation Organization, the United Nations Framework Convention on Climate Change, and the South Pacific Fishing Management Organization, among many others.

Lacking membership in these and other international regimes, Taiwan could neither contribute to the international community, nor fulfill the global citizen’s responsibility in good governance. In the schemes of liberalization, facilitation, standardization, regulatory reform, and development assistance, Taiwan should not be absent. The growing confidence in Taiwan as a “responsible stakeholder” rather than a “trouble maker” should enhance Taiwan’s expanded international participation and contribution.

Taiwan will continue to apply for international participation for practical reasons that will benefit both it and the international community. Taiwan does not need to be an open gap for health or environmental security. Taiwan has a lot to contribute to economic security with the efforts in establishing a SME Crisis Management Center in APEC, for instance.

Threats: Delicate Balance between Expectations and Feasibility

China’s approach to ECFA, especially the proportional – not absolute – equilibrium in Taiwan’s favor in the Early Harvest negotiations, further enhance the image of China as capable of being a reasonable and responsible stakeholder. On the other hand, China’s expectations may or may not match the feasible pace of change in Taiwan, and vice versa.

The sensitive issue of Taiwan’s de facto, if not de jure, sovereignty will require wisdom in the domestic, cross-strait and international arenas. Any oversight or misstep by either side could easily backfire and ignite tension of various intensities in the region. Cross-strait dialogues on the sovereignty issue must take place sooner or later and should be “sensible, reasonable and legal” (合情、合理、合法). International reactions and appropriate treatment of this critical issue remains a possible threat to the landmark breakthroughs elaborated thus far.

As to the pressure on the bilateral Trade and Investment Framework Agreement (TIFA) between the United States and Taiwan, a strong sense of mutual good-will is in order. The United States has over time come up with various “pre-conditions” for initiation or revival of TIFA—first intellectual property rights, then the pharmaceutical industry, and now beef. What might be next? The expectation of “preconditions” certainly differs greatly from expectations for the “TIFA Agenda” per se.

Taiwan has always been in a delicate position in U.S.-China-Taiwan triangular relations. The shifting paradigm of the current geo-political and geo-economic landscapes has created a sense of mutual distrust between the insurmountable U.S. and the inevitable Mainland China, shall we say. The undercurrents of the Trans Pacific Partnership led by the U.S. vis-à-vis the “ASEAN+X” schemes actively participated in by Mainland China cannot be a blessing for the region or the world, even though healthy “competitive liberalization” in the pure economic sense could be persuasive.

A Maxi-Min Approach for Economic Integration

Given the positive and negative factors in both the internal and external environments identified in the SWOT analysis above, Taiwan is striving for a viable approach to sustainable development in the global financial and economic environment. Taiwan does not want to be – and cannot afford to be – left out of the regional integration process. This is most evident in the current cross-strait economic relations. Nevertheless, Taiwan needs to diversify its risks, and avoid becoming overly reliant on China. A maxi-min approach, proposed here, is geared towards maximizing common interests and minimizing conflicting interests. In other words, Taiwan aims to maximize the internal strengths and external opportunities on the one hand, and to minimize the internal weakness and external threats on the other.

ECFA could serve as an example for conflict resolution with a maxi-min approach. With concerted efforts and open communication, we could alleviate the weaknesses and threats identified above. Political will for high-level communication is indispensable for dissipating potential or perceived weaknesses and threats. The strengths and opportunities should be firmly grasped and modified behaviors should be rewarded in a mutually reinforcing confidence-building mechanism. Regional security is manifested in our maxi-min deliberations. It is of no avail if we simply moan and groan over the unsettling yet unavoidable dynamics in the shifting paradigm. We ought to exert joint wisdom with strong political will for conflict resolution.

Some may question Taiwan’s will and capability to fulfill its commitments. It is not difficult to realize that adapting to the challenges of globalization is a great challenge for most nations, including Taiwan, given different levels of development. Good governance in the areas of policy formulation, consensus building, bipartisan collaboration, public outreach, domestic restructuring, and adapting to international standards will continue to be the challenges for most developing economies. The global trade system is at an impasse not because most do not have the political will, but because in a given time, we are facing the tough issue of good governance. It may be helpful for trade partners to render more empathy than suspicion, more capacity building than finger pointing.

Taiwan will continue to resist the possibility of being marginalized, and to strive for an environment conducive to joint collaboration and healthy competition. We would like to build on what we have accomplished and broaden our participation in the international community. Relations with our trade partners could be explored bilaterally, regionally and globally. As a member of the World Trade Organization, Taiwan is entitled to explore free trade agreements with all other WTO members. Taiwan’s free trade agreements with others need not be seen by third parties as a dangerous threat, part of a zero-sum game, or a winner-take-all trap. In due course, they could prove to be engines of growth, catalysts for regional integration, and models for mutual learning in the process of globalization. With a maxi-min paradigm for implementation, we could ensure that regional peace and prosperity are here to stay.

The geo-economic challenges in the Asia-Pacific region are inseparable from the overall global economic landscape. The global imbalance and structural reform are the key issues of concern. Whereas the United States and European Union are currently experiencing varying degrees of economic distress, the surging of the emerging markets has become a new source of hope for economic growth. Global institutional arrangements, such as the G20, have attempted to address the global imbalance and construct a global economic order for the post-crisis era. Taiwan, though ranked as the world’s 18th largest economy, has not had the pleasure of contributing to the G20. However, Taiwan has undertaken bold endeavors in unilateral reform, bilateral trade agreements, plural endeavors in APEC, and multilateral efforts in the WTO. Taiwan stands ready to continue its efforts in ECFA with China, and some potential bilateral and plural deliberations in the region, including the U.S.-Taiwan TIFA, ASEAN++, and TPP. The spirit of open regionalism, which underlines the construct of APEC, should be a good reminder for us all when we are building toward well-managed cross-Pacific relations.

Authors

Mignonne Man-jung Chan