cross-strait relations at a crossroad: impasse or breakthrough? cross strait relations a... ·...

Cross-Strait Relations at a Crossroad 141

American Foreign Policy Interests

American Foreign Policy Interests, 23: 141–162, 2001Copyright © 2001 NCAFP1080-3920/01 $12.00 + .08

Background

Taiwan’s Change of Governmentin May 2000

Taiwan’s second popular presidential electiontook place on March 18, 2000. Chen Shui-bian,candidate of the opposition Democratic Progres-sive party (DPP), won the presidency with 39percent of the votes cast, followed by People’sFirst party (PFP) candidate James Chu-yu Soongwith 36 percent, and Kuomintang (Nationalistparty; KMT) candidate Lian Chan with 24 per-cent.1 Chen, 50, and his running mate, AnnetteHsiu-lien Lu, 56, were inaugurated on May 20,2000, as the tenth president and vice presidentof the Republic of China (ROC). President Chenappointed Tang Fei, 68, former minister of de-fense, as premier. Tang resigned on October 3,2000, after holding office for only 137 days forreasons of poor health as well as disagreementwith the DPP leadership on the continued con-struction of the Fourth Nuclear Power Plant.2

Chang Chun-hsiung, 63, then secretary generalof the Presidential Office, succeeded him. Of the34 cabinet posts, only a few are filled bycard-carrying DPP members; the rest areDPP-supporting independents, scholars, andsome former KMT officials who have joined the

new Cabinet as individuals. One independentCabinet member worth noting is, of course, TsaiYing-wen, chairwoman of the Mainland AffairsCouncil (MAC), which is in charge of formulat-ing and executing Taiwan’s policy toward thePeople’s Republic of China (PRC) on the Chinesemainland. Tsai was formerly a professor of inter-national trade law at National Chengchi Univer-sity, was associated with a confidential think-tankgroup, and was appointed by former PresidentLee Teng-hui to the Presidential Office to be incharge of research on Taiwan’s sovereignty andinternational status. The former president’sstatement in a German radio interview charac-terizing Cross-Strait relations as “a specialstate-to-state relationship,” the so-called two-state theory, on July 9, 1999, was reported to beTsai’s brainchild.3

Until the presidential election of March 18,2000, the Kuomintang had dominated Taiwan’spolitical scene since 1949, when it lost the civilwar to the forces of the Chinese Communist party(CCP) and retreated from the Chinese mainland.The election not only changed the political land-scape in Taiwan but fundamentally altered thetraditional KMT–CCP confrontation that had ex-isted across the Taiwan Strait for the last half-century. Taiwan’s peaceful change of governmentmade it a full-fledged democracy. Yet it also in-jected new variables into the already troubled

Cross-Strait Relations at a Crossroad:Impasse or Breakthrough?

Ying-jeou Ma

In its original form this article was a speech delivered by Dr. Ying-jeou Ma, mayor of Taipei City, at the Roundtableon U.S.–China Policy and Cross-Strait Relations sponsored by the National Committee on American ForeignPolicy in New York City on February 8, 2001. It was rewritten and revised to mid-March 2001. The author wishesto thank Mr. Victor W. Chu, Ms. I-chih Tsai, and Mr. Chih-chang Shen for their generous and invaluable assis-tance in research and Mrs. Marilyn Duncan-Webb for proofreading.

142 Ying-jeou Ma


Cross-Strait relationship. Its profound implica-tions remain to be seen. The election was under-standably selected by the international media asone of the top 20 news events of the world in2000.4

President Chen’s Strength and WeaknessRegarding Cross-Strait Relations

President Chen Shui-bian has been a sup-porter, but not a fundamentalist one, of Taiwanindependence (TI). Born in southern Taiwan’sTainan County in September 1950 to a poor fam-ily, he graduated from the Law Department ofNational Taiwan University, the best in the coun-try, in 1974.5 He practiced maritime law for sevenyears and gained a national reputation as thedefense attorney during the Formosa Incident.He entered politics in 1981 and won a seat in theTaipei City Council in December, achieving a highnumber of votes. He did well as an oppositioncouncilor but failed in his bid to win the TainanCounty magistrate election in December 1985.Soon after the election, his wife was hit by a smalltruck while the couple was walking in a thanks-giving parade with his supporters. She was para-lyzed from the waist down. Later, while his wifewas a candidate in the legislative election and inDecember 1986 won a seat in the Legislative Yuan(national parliament), he was jailed for eightmonths for libel. Once out of jail, Chen Shui-bianfirst worked as a legislative assistant to his wifeand then, in 1989, was elected as a legislator. Hisperformance in the Legislative Yuan again wonhim national popularity. During his second termhe ran for and won with 43.6 percent of the votethe Taipei mayorship in 1994, defeating both theKMT and New Party (NP) candidates, who werevictims of the KMT’s split. Chen did fairly wellas mayor but lost his office in 1998 to a KMTcandidate.6 Extremely disappointed, he did a thor-ough soul-searching and was able to make a po-litical comeback by taking advantage once moreof the KMT’s serious infighting. He became thefirst non-KMT president of the Republic of China

in May 2000. During his presidential campaign,he continued to support the TI’s “one China, oneTaiwan” official line but vowed neither to changethe status quo nor to declare the birth of an inde-pendent Taiwan if he was elected president. Heemphasized that he would follow a “new middleroad” and make peace with the People’s Repub-lic of China (PRC).7 On the one-China principle,he said that “one China” could be a topic for fu-ture negotiations with the PRC but not a pre-condition for such negotiations.8

Being a TI supporter obviously put PresidentChen in a difficult position in handlingCross-Strait relations. Although the CCP lead-ers have little trust in their KMT counterparts,they at least have something in common—namely,the shared memory of the past and the ultimate,long-term goal of China’s reunification. The DPP,having been established for only 14 years andhaving had no mainland experience at all, is anentirely different political party. Its partycharter’s insistence on Taiwan independence isopposite to the PRC’s one-China principle andtotally unacceptable to the PRC. It would be dif-ficult, if not impossible, for President Chen toestablish mutual trust with the PRC leadershipif the party charter remains unchanged. On theother hand, fully aware of his liabilities, Presi-dent Chen boldly modified his pro-TI positionearly in his presidential campaign to pacify thePRC, the United States, and the internationalcommunity in general. Furthermore, citing pre-viously anti-Communist U.S. President RichardNixon’s dramatic opening to Communist Chinain 1971, President Chen and his DPP staff main-tained that he is in a better position than a KMTpresident to strike a deal with the PRC. This viewis not entirely far-fetched because Chen, as aclever politician, does have flexibility. When hewas a legislator in the early 1990s, he proposedthat Taiwan and the PRC adopt the “one-nation,two-states” formula to solve their differences.9

This was an adaptation of the so-called GermanFormula, namely, “one Germany, two states”(Eine Deutschland, zwei Staaten), clearly a farcry from Taiwan independence in the sense that



Taiwan is still part of the larger Chinese nation.In the following analysis, we will see more of hisflexibility in handling Cross-Strait relations.

The PRC reacted cautiously to the victory ofits least favorite candidate in Taiwan’s presiden-tial election. Only a few days before the March18, 2000, election, PRC Premier Zhu Rongjiblasted TI supporters in Taiwan.10 The moveproved counterproductive, similar to the effectsof the menacing missile test that the PRC con-ducted off Taiwan’s coast exactly four years be-fore, in March 1996, when Lee Teng-hui was run-ning for reelection as president. At that time Leewon a landslide victory with 54 percent of thevotes cast. The missile test gave President Leethe opportune moment to appeal to his country-men for more support. And he got it. This timeChen won the election unexpectedly, again withunsolicited help from the PRC. Ever since Chen’svictory, the PRC has taken a “listen to what hesays and watch what he does” attitude11 similarto its stance toward former President Lee during1996–2000. Meanwhile, Beijing continues to ad-vocate its fundamentalist policies of one China,two systems or simply the one-China principle,without elaborating on specific responses toevents taking place in Taiwan.

President Chen’s Approachto Cross-Strait Relations

The New Middle Road and the Five No’s—Conditional Departure from TaiwanIndependence

Chen’s unexpected election victory shockedmany people in Taiwan. Keenly aware of his mi-nority position, he maintained an extremely lowprofile after the election and before the inaugu-ration. He visited many KMT elders, sought theiradvice, mended fences, and generated a lot ofgoodwill. His appointment of Tang Fei, a populardefense minister in the previous KMT cabinet,

as premier obviously was motivated by Tang’sfour distinct backgrounds. He is a formerfour-star Air Force general and chief of the Gen-eral Staff, a long-time and loyal KMT member, amainlander, and a Chinese unification supporter.Thus Chen tried to win the support of more than60 percent of the voters who did not vote for himduring the election. Chen then declared that hewas building an “upright and all-people’s govern-ment.”12 He also repeated his campaign promisethat he would not declare Taiwan an indepen-dent state and would set up a cross-party groupled by Dr. Yuan T. Lee, president of AcademiaSinica and one of the 1986 Nobel laureates inchemistry, to deal with Cross-Strait relations. Aweek before his inauguration, Chen announcedthat the part of his inaugural address dealing withCross-Strait relations would “satisfy the Ameri-cans, please the international community, and notprovoke China.”13 On the eve of Chen’s inaugu-ration on May 20, 2000, the opinion polls con-ducted by the media showed that around 70 per-cent of the people polled approved his perfor-mance.14 The rating went up to 79 percent amonth after his inauguration.15 That gave himfurther confidence about building an “uprightand all people’s government.”

President Chen’s inaugural address of May20, 2000, did contain important statements thatdiluted his TI coloration. He stated:

As long as the CCP regime has no in-tention to use military force againstTaiwan, I pledge that during my termin office, I will not declare indepen-dence, I will not change the nationaltitle, I will not push for the inclusion ofthe so-called state-to-state descriptionin the Constitution, and I will not pro-mote a referendum to change the sta-tus quo in regard to the question of in-dependence or unification. Further-more, there is no question of abolish-ing the Guidelines for National Unifi-cation and the National UnificationCouncil.16

144 Ying-jeou Ma


What he promised not to do, in essence, iswhat the Constitution of the Republic of China,which he vowed to uphold at his swearing-in cer-emony, would not allow him to do anyway. Hispromises also duplicated the KMT’s party line ofpast years. Chen, however, was not merely stat-ing what was obvious to every constitutional law-yer and making a virtue out of necessity. What issignificant about the Five No’s is not what andhow the statement was made, but who made it.President Chen was a former (or is a current) TIsupporter who had frequently criticized theone-China Constitution, which was adopted in1947 by the National Assembly on the Chinesemainland and represented at the time all of theapproximately 500 million Chinese people (in-cluding those of Taiwan). Once he had vowed topropose a new one. The Five-No’s Statementshows how much President Chen has modifiedhis position on the core value of his political be-liefs. This is a significant move that indicates hehas come a long way. Making it may incur highpolitical costs for him. Yet all his promises hingeon the PRC’s willingness not to use force againstTaiwan, and they are good only as long as Presi-

dent Chen is in office. However conditional suchpromises may seem, the Five-No’s statement re-ceived popular approval at home and abroad as amature, responsible policy capable of at least sta-bilizing Cross-Strait relations when Chen estab-lished his new administration after his inaugu-ration. The PRC reacted calmly and simply toPresident Chen’s inauguration by reiterating theone-China principle. Obviously Beijing thoughtit needed more time to get the measure of thisnew leader of Taiwan and did not find it appro-priate to respond right away.

The 1992 Consensus: Did It Really Exist?

The euphoria generated by the inaugural ad-dress faded as the new DPP government, firstled by Tang Fei and then by Chang Chun-hsiung,began to face tough challenges from the Legisla-tive Yuan: Of 220 seats, 114 (more than half) be-long to the KMT, and only 67 (less than one-third)are held by DPP members or firm supporters. Thehealth of Premier Tang, who had a major chestoperation just before the inauguration, and theteamwork of the new Cabinet, whose many newhands are not familiar with the running of a gov-ernment, became issues. On June 20, when Presi-dent Chen held a one-month-in-office press con-ference, he referred, among other things, to theOctober 1992 meeting between the Strait Ex-change Foundation (SEF), representing Taiwan,and the Association for Relations Across the Tai-wan Strait (ARATS), representing the mainland,as a meeting in which the only consensus on theone-China question was no consensus at all or anagreement to disagree at the most.17 Seven dayslater, on June 27, President Chen stated to agroup of visiting American scholars from the AsiaFoundation, including China specialist HarryHarding, that he accepted the one-China-with-different-interpretations-by-each-side consensusreached by the two sides in Hong Kong in 1992.The statement was included in the press releaseissued by the Presidential Office on June 27, 2000,and was widely reported by the media.18 Barely

From the Penof a Political Realist

Two principles should govern anycommon strategy: that the Americanalliance with South Korea and not therapprochement with North Korea is thekey to stability on the peninsula; andthat South Korea should play the lead-ing role in inter-Korean negotiations.Pyongyang must be convinced that theroad to Washington leads through Seouland not the other way around.

—Henry A. Kissinger



24 hours later, Chairwoman Tsai Ying-wen of theMAC hastily called a press conference to clarifythat what the president meant was no differentfrom what he said on June 20—namely, that noconsensus had been reached in 1992 on the one-China principle.19 A few days later, Tsai went fur-ther and said that the consensus was not oneChina with different interpretations by each sidebut rather “[each side] differently interprets oneChina.”20 This game of words added a new strainof confusion to the already cloudy Cross-Straitrelationship.

From then on, the 1992 Consensus seemedto become a nightmare to the DPP government,which tried desperately to deny its existence. Infact, many who were directly involved in prepar-ing and conducting the November 1992 negotia-tions in Hong Kong that led to the consensus—including Chairman Koo Cheng-fu of the SEF;Chiu Chin-yi, former vice chairman and secre-tary general of the SEF; Dr. Kao Kung-lian, vicechairman of MAC; and the author, who wasMAC’s senior vice chairman and spokesman—remember clearly that such a consensus on theone-China principle was reached and that eachside had agreed in correspondence that the mean-ing of one China, on which they disagreed, wasto be interpreted orally by each side. Althoughno written agreement was signed, correspondencebetween SEF and ARATS following the Novem-ber meeting attested to the existence of such aconsensus.21 The formulation “one China, differ-ent interpretations by each side” was actuallycoined by the media. Furthermore, it is obviousthat, had no such consensus existed, theepoch-making Koo–Wang talks held five monthslater on April 29, 1993, in Singapore22 and thefour agreements signed then would not have beenpossible given the PRC’s absolute insistence onrecognizing the one-China principle.

What the DPP government came up with nexton this thorny issue was even more amazing. OnJuly 31, 2000, when President Chen called a pressconference, he said that although there was noconsensus on one China in 1992, there was a“1992 spirit”—namely, “dialogue, exchange, and

shelving disputes.”23 Such a formulation, obvi-ously intended to downplay the issue and distractpopular attention, had the effect of pouring fuelon the fire. Many people, including those in themedia, began to question the credibility of theDPP government. They argued that, although theDPP government had every right not to agree tothe one-China principle to which it has long beenopposed, it should not deny the existence of a his-torical fact. By so doing the new administrationmade itself even less credible not only to its coun-terpart on the Chinese mainland but to the gen-eral public in Taiwan. The issue remains a livelyone in Taiwan today because all the oppositionparties (the KMT, the PFP, and the NP) agree onthe existence of such a consensus and have calledon the new administration to recognize it. Thenew administration’s failure to do so in effectcontinues the stalemate across the Taiwan Straitthat has lingered for more than six years.High-ranking officials of the MAC keep sayingthat the resumption of talks between the twosides is not the only way to maintain peace in theTaiwan Strait and to promote Cross-Strait rela-tions.24 Under such circumstances, promoting thethree mini-links is the only thing the DPP gov-ernment can do on its own to show progress inCross-Strait relations without touching on theone-China issue.

On the other hand, the PRC has insisted thatrecognizing the one-China principle is the pre-condition to resuming talks between the two sidesor at least that the talks should be resumedunder the one-China principle. Also, it has de-manded that Taiwan go back to the 1992 Con-sensus as a first step. It should be kept in mindthat what the PRC means by the 1992 Consen-sus is one China, not one China with differentinterpretations by each side. The PRC omittedthe latter half of the 1992 Consensus as Taiwanunderstands it in the mid-1990s, when Cross-Strait relations became sore in fear that Taiwanwould take advantage of the phrase “different in-terpretations by each side” to promote Taiwanindependence or similar policies. The emergenceof the two-state theory in July 1999 gave cred-

146 Ying-jeou Ma


ibility to Beijing’s fear. As a result, PRC schol-ars, let alone the PRC government, are reluctantto mention the “different interpretations by eachside” part of the 1992 Consensus. That could alsoexplain why the DPP government does not wantto go back to the 1992 Consensus that is no dif-ferent from the one-China principle as the PRCinterprets it.

The Relevance of the Three Mini-Links

Shortly after the presidential inauguration,the MAC announced that it would permit the es-tablishment of direct links between Kinmen(Qimoy) and Xiamen (Amoy) and between Matsuand Mawei.25 Kinmen, belonging to KinmenCounty, and Matsu, belonging to LianjiangCounty, both of Fujian Province, are 67 nauticalmiles apart. They are the only major offshore is-lands close to the Chinese mainland that are stillunder the control of the ROC government. Theybecame world-renowned when they were bom-barded by more than half a million shells firedby the PRC forces across the narrow strips ofwater during August–September 1958.26 TheKinmen/Matsu crisis involved not only Taiwanand the PRC but also the United States and theSoviet Union because at that time Taiwan andthe United States were bound by the Mutual De-fense Treaty of 1954. Therefore, since 1958, theseislands have been under heavy garrison. Whenmartial law on Taiwan was lifted in July 1987, itremained in effect on the islands until themid-1990s. In April 2000, the Statute for the Re-construction of Offshore Islands came into exist-ence.27 This statute permits direct links betweenKinmen and Matsu, on the one hand, and theChinese mainland, on the other. That means thatthe current prohibition on direct links with themainland is inapplicable to Kinmen, Matsu, andPenghu (the Pescadores, located in the TaiwanStrait between central Taiwan and the Chinesemainland).

The above statute was passed after the presi-dential election on March 18, 2000, but before

the inauguration on May 20. The previous KMTcabinet had also approved the plan to proceedwith establishing the three mini-links but did nothave enough time to implement it. The DPP Cabi-net followed the policy, and the MAC used thismove to show progress in Cross-Strait relationsunder the DPP government, apparently hopingthat, if everything went right, regular links wouldfollow. In their view, the PRC may be reluctantto oppose a move that it demanded approximately10 years ago under the slogan “The two gates[men] open to each other and the two horses [ma]go together first.” They believe that the PRC willat least passively agree to cooperate on the threemini-links and, if everything goes well, the PRCmight agree to enlarge the scope to three regularlinks. By then, in their opinion, it may not benecessary to solve the tough one-China issue.That, of course, by and large, is wishful thinkingon the part of the DPP government.

Residents of Kinmen and Matsu have longwanted such links, as do residents along the coastsof the Chinese mainland opposite these islands.Some of them are former residents of Kinmenand Matsu but have been unable to go home inthe last 50 years. Many more want to do busi-ness with the two islands, whose residents havea much higher standard of living and greater pur-chasing power. After all, the two islands are geo-graphically close to the mainland and far awayfrom Taiwan. The fact that they have been at-tached to Taiwan politically, economically, andmilitarily is simply due to the 50-year-old civilwar between Taiwan and the Chinese mainland.Tension began to ease when the PRC stoppedshelling the islands on January 1, 1979, and is-sued its “Letter to the Taiwan Compatriots” onthe occasion of the formal establishment of dip-lomatic relations between Beijing and Washing-ton.28 Illegal trade and travel have been rampantsince then; so are fishery disputes between fish-ermen from the two sides. Local military andpolice authorities have had to arrest mainlandfishermen, who use dynamite in fishing, for vio-lating Taiwan’s fishing laws and to disperse main-land fishing boats operating too close to the coasts



of Kinmen and Matsu. Policing these infractionsis troublesome, and many mainland fishermenend up serving their sentences in Keelung Prison,more than 100 nautical miles away in northernTaiwan. The need for emergency assistance anddisaster relief could also make possible coopera-tion between these islands and the Chinese main-land.

The three mini-links were formally launchedon January 1, 2001.29 County magistrates ofKinmen and Lianjiang went to Xiamen andMawei, respectively, to meet their counterparts.Despite the fact that they were warmly received,the PRC’s central and local authorities were de-liberately cool to the idea for fear that Taiwanwould use this move to evade the one-China is-sue. At the moment, this initiative has had theeffect of legalizing some of the erstwhile illegalsmuggling, which the PRC called a small amountof trade. But aside from the visits by Kinmen andLianjiang county magistrates on the first day, asof March 4, 2001, only one passenger-carryingship has been permitted to operate between thetwo sides because Taiwan and mainland residentsare not permitted to use these two islands as tran-sit points to and from the Chinese mainland.30 Inaddition, both the mainland and Taiwan requirethat for entry to and exit from Kinmen or Matsu,residents travel as a group. No one may travelindividually. It will take some time before tradeand tourism can reach normal levels. The open-ing of the three mini-links did give residents highhopes for the future, yet what followed didnot fulfill their expectations. Furthermore, to en-force the ban on people and goods in transit,much tighter security measures were imposed,making the movement of people and goods be-tween Taiwan and the two offshore islands evenless convenient than before. In any case, giventhe PRC’s inaction, the significance of the threemini-links on Cross-Strait relations is largelysymbolic now.

On the other hand, Tsao Er-chung, a KMTlegislator, and Chen Cheng-ching, LianjiangCounty Council speaker, went to Fuzhou, thecapital of Fujian Province, on January 28, 2001,

and signed an agreement with a mainland orga-nization called the Fuzhou Mawei Cultural andEconomic Cooperation Center aimed at promot-ing interchange between Matsu and the Fujiancoast.31 The MAC initially said that, without au-thorization from the MAC, this agreement hadno legal effect. On January 30, Tsao met withMAC Chairwoman Tsai Ying-wen and reacheda consensus that the agreement is betweennongovernmental entities of the two sides andwill be treated as such.32 The agreement showsthe eagerness of Matsu residents for improv-ing Matsu’s economic conditions by conduct-ing more trade and other contacts with the geo-graphically close Fujian coast. It also demon-strates the PRC’s strategy of differentiation indealing with the central and local governmentsof Taiwan. In any case, so far the three mini-linkshave not worked well. It remains to be seenwhether traffic will pick up in the next two orthree months. If not, then the policy can bedeemed a failure.

The Cross-Party Group and Its PolicyAdvice

Officially President Chen’s purpose in settingup a cross-party group was to provide consulta-tions on Cross-Strait relations. Unofficially, it isintended to bypass the National UnificationCouncil (NUC). The NUC is a consultative taskforce that was set up in 1990 to provide advice toformer President Lee Teng-hui. It is composedof representatives from the Presidential Office(such as the secretary general to the president),Executive Yuan (Cabinet; the premier, the chair-man of the MAC), the chairman of the SEF, thepresident of the Legislative Yuan, mayors andCity Council speakers of Taipei and Kaohsiungcities, leaders of political parties, and opinionleaders at home and abroad. The NUC has aresearch arm composed of front-line officials(such as the deputy secretary general of the Presi-dential Office, the vice chairman and spokesmanof MAC), scholars, and specialists. Originally it

148 Ying-jeou Ma


met once every season. President Lee gave im-portant policy speeches at the opening session.During the last five years, the frequency of themeetings has decreased to once a year at most,obviously reflecting the stalemate in Cross-Straitrelations.

The DPP has always boycotted the NUC. Itrefuses to participate for fear that its presencewill be interpreted as endorsing the unificationof China, thereby seriously weakening its su-preme policy on Taiwan independence. The DPPonce suggested that President Lee change the titleof the Council or set up a separate committee onnational development to make the party’s par-ticipation easier. Huang Hsin-chieh, theex-chairman of the DPP, was about to join theCouncil a few years ago but backed out at theeleventh hour under great pressure from his ownparty.

When Chen Shui-bian became president, hepromised not to abolish the NUC or to repeal theNational Unification Guidelines (the fifth “no”)in his inaugural address. Yet it is obvious thatthe governing idea is to freeze its operation andleave it frozen indefinitely. On the other hand,he does need a consultative body to advise himon mainland affairs; hence the establishment ofthe Cross-Party Group, which was slated to becomposed of representatives from each politicalparty and nonparty independents. But the KMTand the PFP have decided to abstain, claimingthat Chen should restore the operation of theNUC. Hao Lung-bin, a legislator and the Newparty’s chairman (and minister of environmen-tal protection since March 7, 2001), joined thegroup when it was formed but quit in protest afew months later. Although some members of thegroup are KMT members who participate as in-dividuals or independents, the original idea ofmaking the group a forum in which all the politi-cal parties could reach consensus on mainlandpolicy did not come to fruition.

The group did manage to hold a dozen or someetings in order to integrate wide-ranging viewson issues such as one China, the 1992 Consen-sus, the three links, and so on. The fact that Dr.

Yuan T. Lee, chairman of the group and presi-dent of the Academia Sinica, called himself Chi-nese and said that the DPP government shouldgo back to the 1992 Consensus raised the outsideworld’s expectations of the group, although itsspokesman quickly clarified that the statementwas the personal view of Dr. Lee and did not rep-resent the viewpoint of the group. Nevertheless,the final conclusion that was issued on Novem-ber 26, 2000, clearly suggested, among otherthings, that President Chen respond to the PRCon the one-China question in accordance with theConstitution of the ROC.33

The group’s conclusion, composed of threeunderstandings and four suggestions, met withvaried responses in Taiwan, some positive andsome negative. The opposition parties again criti-cized the composition of the group as being un-representative. There are some who believe thatthe group has come a long way in integrating somany diverse opinions. They believe that the ref-erence to the ROC Constitution was particularlytimely and useful. But the PRC ridiculed thegroup’s conclusions as “neither one thing nor theother,” a Chinese idiom meaning something in-solent.34 Nevertheless, one should not lose sightof the group’s major concern—namely, theone-China issue and the mechanism to integrateexisting organizations such as the NUC. In fact,the author believes that the most important func-tion of the group is to prepare an exit for Presi-dent Chen to get out of the tangle associated withthe one-China issue and the NUC. Whether Presi-dent Chen should call a meeting of the NUC andchair the meeting himself or let members of theNUC freely elect a chairman is a question of greatsymbolic significance to Taiwan and to the PRCand has been discussed in the media in the lastseveral months. In essence, although the group’srepresentation became an issue when it was setup, it has been able to come up with somethingnot entirely useless and may yet serve as an exitfor President Chen to solve his dilemma in deal-ing with the one-China issue. Of course, it alldepends on how he reacts to the conclusions ofthe group.



President Chen’s New “Integration”Initiative

Seemingly in response to the conclusions ofthe Cross-Party Group, President Chen did saysomething new in his Cross-Century Remarks onDecember 31, 2000. First, he referred to what hehad said in his inaugural address: that leaders ofthe two sides should jointly handle the one-Chinaissue under principles of democracy and equal-ity. He then said,

Actually, according to the Constitutionof the Republic of China, “one China”should not be an issue. We hope themainland can have [a] better under-standing of the doubts in the minds ofthe people of Taiwan. If the mainlandcan neither respect nor understand thewill of the 23 million people of Taiwanto make their own decision, this willlead to unnecessary differences betweenthe two sides.

He continued,

We would like to appeal to the govern-ment and leaders on the Chinese main-land to respect the existence and inter-national dignity of the Republic ofChina; publicly renounce the use offorce; and overcome the current disputeand deadlock through tolerance, fore-sight, and wisdom. The integration ofour economies, trade, and culture canbe a starting point for gradually build-ing faith and confidence in each other.This, in turn, can be the basis for a newframework of permanent peace andpolitical integration.35

Again, the reactions in Taiwan were varied.In the MAC’s year-end press conference on Janu-ary 19, 2001, Chairwoman Tsai Ying-wen gavethe official interpretation of President Chen’s

political integration remarks by saying that “po-litical integration” could mean “a direction, aprocess or an objective, and political integrationdoes not necessarily exclude any of the threeoptions Taiwan has, namely, unification, inde-pendence and status quo.”36 Obviously, she triedto tone down the impact and retract the direc-tion of the remarks because, in the ordinarymeaning of the word integration, the only optionthat could most likely be excluded is indepen-dence.

The reactions of the political parties werepoles apart and clearly cut. The TI fundamental-ists were outraged. DPP legislators complainedthat President Chen went too far too fast beforethe PRC and the Opposition Alliance (that is,the three opposition parties) could release anykind of meaningful goodwill. Most of the mem-bers of the New Tide Faction of the DPP, the mostpowerful one, asked the president not to pursuethe integration theory. On the other hand, thethree opposition parties praised President Chenfor this new statement. In addition,prounification fundamentalist groups applaudedthe remarks.

There are two new elements that are worthobserving. First, this is the first time PresidentChen clearly admitted that the Constitution ofthe Republic of China contains the one-Chinaprinciple and is a one-China constitution. In-asmuch as this is self-evident, almost everyconstitutional scholar (except TI supporters)pointed out the truth of the statement in the past.Even Frank Hsieh, chairman of the DPP anda lawyer, said as much. Naturally he was un-der heavy fire within his own party and wasunder great pressure to keep quiet. Now thatPresident Chen has made the same statement,TI fundamentalists have criticized him too, buthe seems able to withstand such pressure. Afterall, as president of the Republic of China, Chenis under a constitutional duty to do so. Second,this was the first time that President Chenstressed to such an extent the economic, cultural,and political integration that has occurredbetween the two sides of the Taiwan Strait.

150 Ying-jeou Ma


The most significant meaning of political inte-gration is that it points to a new thinking thatnot only discounts the separatist attitude that hepromised in his inaugural address he would notfollow but proceeds to explore the possibility of apermanent association with the PRC short ofoutright unification. If this interpretation is cor-rect and President Chen has the courage to reachconsensus with his own party comrades and theopposition parties and push it through, manyof the problems the DPP government has en-countered in Taiwan in handling Cross-Strait re-lations could be gradually ameliorated. Butwhether that would be readily acceptable to thePRC remains to be seen. In short, the new re-marks not only have served to place Taiwan in-dependence farther away from where it used tobe but have moved it to a stage that could lead toa certain form of association with the Chinesemainland.

Of course, one has to keep in mind that thisis only a statement, not a concrete policy orprogram. What President Chen will do to implement his statements remains to be seen.In this regard, his track record is unimpressive.In the past nine months, policies that hadseemed to be magnificent went nowhere eitherbecause they were not workable or because theymet with strong opposition from his own party.On the other hand, the opposition partieswelcomed such remarks because their voterscould accept them. In fact, since 1911 the ROChas been an independent sovereign state for 90years. Currently not under the rule of any for-eign nation, it has no need whatsoever to declareits independence a second time. No country inthe world has done or would do that. Therefore,the independence option is not needed; the onlyoptions Taiwan has are to maintain the statusquo or to be reunited with the Chinese mainland.Here the “integration” concept could possiblytake care of both. This is why the opposition par-ties welcome, while the DPP opposes, such amove.

From Euphoria to Disillusion:Cross-Strait RelationsDuring the Last Nine Months

To get an insight into the DPP government’sperformance on Cross-Strait relations, one shouldnot overlook the new administration’s overallperformance and its impact on relations acrossthe Strait. First, a look at Taiwan’s stock marketis instructive because, to a great extent, it reflectsthe country’s economic health and its people’sconfidence in their government. On March 17,2000, the day before the election, the Taiwanstock index was 8,763. After the election, on April5, it went up to 10,186. By the time PresidentChen was inaugurated on May 20, it dropped to9,162. The index continued to go down ratherquickly: to 7,961 on July 26; 6,432 on September29; 5,404 on October 20. It reached the lowestpoint of 4,614 on December 27. During the monthof January 2001, there was some good news: Theindex bounced back to 5,847 on the 18th, the lasttrading day before the Chinese New Year holi-day. It went down and up again and stood at 5,610on March 13, 2001. The market, in effect, hasdropped more than 4,000 points on average, or47.7 percent overall, for most of the time duringthe last nine months. The total market value ofstocks decreased more than NT $4 trillion (or U.S.$125 billion).

If chain reactions such as losses of businessare included, the amount could be as high as NT$10 trillion (or U.S. $312 billion).37 During theyear 2000, approximately 4,995 companies closedtheir factories, an increase of 25 percent over theprevious year, according to the Ministry of Eco-nomic Affairs. The unemployment rate rose to3.35 percent, the highest in 15 years.38 The num-ber of companies moving to the Chinese main-land increased substantially. Large domestic in-vestments—those over NT $200 million (U.S. $6.2million)—dropped 50 percent from NT $137.9billion (U.S. $4.3 billion) in January 2000 to NT$68.1 billion (U.S. $2.1 billion) in January 2001.39



As of February 21, 2001, the trade surplus stoodat NT $347 million, down 72.5 percent from thesame period last year.

Meanwhile, in January 2001, PresidentChen’s approval rate in the opinion polls droppedsharply to around 38 percent, compared with 82percent when he had been one month in office,and the disapproval rate went up from approxi-mately 10 percent to a record 48 percent.40 Hisapproval rate dropped further at the end of Feb-ruary 2001 to 34 percent, an all-time low, and thedisapproval rate went up to 53 percent, anall-time high, according to the TVBS Poll Cen-ter.41 Meanwhile, Premier Chang’s rating in thesame poll was 28 percent (approval) and 59 per-cent (disapproval)—also a record for an incum-bent premier. In brief, the DPP government isby far the most unpopular government in thehistory of the post-1949 ROC.

The downturn began in July, when the peopleof Taiwan saw a live scene on TV in which theDPP government took no action to rescue fourworkers who were trapped in a flood in southernTaiwan. They waited for hours before they wereswept away. This was followed by the resignationof Premier Tang Fei in early October because ofdisagreements with the DPP leadership over theFourth Nuclear Power Plant. Tang was in officefor only 137 days, the shortest lived premiershipin the ROC’s history since 1949. It also signifiedthe end of President Chen’s “All People’s Gov-ernment.” The situation worsened after new Pre-mier Chang Chun-hsiung made the abrupt deci-sion on October 27, 2000, to discontinue the con-struction of the Fourth Nuclear Power Plant. Thisdecision was made without consulting in advancewith the Legislative Yuan, to which the Execu-tive Yuan is responsible, according to the ROCConstitution, and which a few years before hadpassed a resolution with a two-thirds majoritydemanding the construction of the plant by theExecutive Yuan (the Cabinet). Meanwhile, VicePresident Lu Hsiu-lien became involved in dis-seminating an unconfirmed story about a ru-mored love affair between President Chen andhis female aide. The outspoken vice president

decided to sue for libel Taiwan’s premier politi-cal news magazine, The Journalist, which hadprinted the story. In mid-January, the serious oilspill from a Greek oil tanker off the coast ofPintung County demonstrated the ineptness ofthe Environmental Protection Administration inconducting rescue and clean-up operations. Of allthose events, the discontinuation of the buildingof the Fourth Nuclear Power Plant is no doubtthe most important because the project is one-third completed. To discontinue the constructionwould not only waste the investment that hasalready been made but would also involve thepayment of hundreds of billions of New Taiwandollars in damages to local and foreign contrac-tors and costs in restoring the construction site.Meanwhile, the about-face has shaken the confi-dence of foreign investors, who found the DPPgovernment to be not only antinuclear but alsoantibusiness. Nevertheless, an antinuclear policyhas been the sacred campaign platform of all DPPcandidates in every election. President Chen’swas no exception. The party decided not to budgean inch.

In November 2000, Premier Chang broughtthe issue to the Judicial Yuan to seek the inter-pretation of the Council of Grand Justices to vin-dicate its position on the constitutionality of thedecision to discontinue the construction of theplant. The Council’s interpretation (no. 520), re-leased on January 15, 2001, did not use the wordviolation, as in violation of the Constitution, todescribe the decision; but the ratio decedendiclearly opined to that effect. The interpretationstated that the decision was procedurally flawed,and the Judicial Yuan asked the Executive Yuanto report to the Legislative Yuan the reasons forits decision. On January 30, the Legislative Yuancalled a provisional meeting to hear PremierChang’s report and decided by a vote of 134 to 70to demand that the Executive Yuan (Cabinet)resume construction right away.

The DPP caucus in the Legislative Yuan, theDPP headquarters, the Executive Yuan, and thePresidential Office initially intended to fight theissue to the last member. Yet public opinion be-

152 Ying-jeou Ma


gan to support the resumption of constructionand called for an end to interparty struggles.President Chen decided to change his mind inearly February amid strong objections and criti-cism from the DPP headquarters and the Legis-lative Yuan caucus to continuing the construc-tion. Premier Chang officially announced the con-tinuation of construction of the Fourth NuclearPower Plant on February 16, 2001, on the onehand, but hinted that he favored a plebiscite onthis issue to be held together with the year-endLegislative Yuan election, on the other hand. Theplebiscite issue exploded in the Legislative Yuanin late February when it was back in session.Many opposition legislators criticized the premierboth for his previous decision, which they judgedto be wrong, and for his latest error of judgment.

Meanwhile, antinuclear groups in Taiwanorganized a demonstration on February 24 toprotest the Cabinet’s about-face on the FourthNuclear Power Plant. They demanded a plebi-scite. They planned to assemble 100,000 to200,000 people, but, according to the police, only8,800 turned out on that day. The crowd includedDPP leaders and one Cabinet member. The Taipeimedia expressed their amazement at the need fora ruling party to take a public policy issue ontothe streets.

If the situation is looked at as a whole, theFourth Nuclear Power Plant issue has paralyzedTaiwan’s politics and to some extent its economyfor more than four months. The plunge in thestock market, the depressed economy, the busi-ness community’s disillusionment, and the gen-eral public’s widespread loss of confidence havenot seemed to teach the DPP government anylessons. Another round of political struggle isquietly ready to begin. The China Times, a majornewspaper in Taiwan, commented in its editorial,“From October 4, 2000, to February 17, 2001, the137 days of Premier Chang just seemed to havevanished; nothing seemed to have happened.Everything is back to square one.”42 When it be-came apparent that the restoration of the plantwould occur, the stock market, quite interestingly,began to go up a bit. It is clear that the message

was delivered to President Chen and his staff.The economic downturn, mounting unem-

ployment and crime rates, and political instabil-ity have combined to make Taiwan’s outlook ap-pear dismal at the beginning of the new century.In the area of Cross-Strait relations, the businesscommunity has long expected the DPP govern-ment to take bolder action vis-à-vis the Chinesemainland and to improve the economic situationin Taiwan. Again, the DPP government has notmoved fast enough to sustain the confidence ofthe business community. There have been enoughdomestic troubles to make them rather cautiousand even conservative. Other than the three mini-links, the DPP government has taken little ac-tion to date.

Questionable Assumptions andUnenthusiastic Action

President Chen and his staff believe that aslong as he promises not to declare Taiwan’s inde-pendence, the PRC will have little reason to useforce against Taiwan. In their opinion, there isno need to respond too soon or to make too manyconcessions too fast, particularly on issues suchas the 1992 Consensus and the one-China prin-ciple in general. They have concluded that theUnited States, generally pleased with PresidentChen’s performance so far, will not exert pres-sure on Taiwan, especially at a time when thenew American president needs some time to de-velop an understanding of the intricacies of Chinapolicy. They also believe that the resumption ofthe Koo–Wang talks is not indispensable to main-taining good Cross-Strait relations. Permittingthe three mini-links could have the same result.Vice President Lu said that the Koo–Wang talksare like “walking through the back door.”43 Thegovernment prefers to negotiate the establish-ment of the three links after the two sides be-come members of the World Trade Organization(WTO). They are convinced that the immediatepriority is to continue pleasing the United Statesand the international community by not provok-



ing the PRC. President Chen said in December2000 that there should be no problem onCross-Strait relations in the following year. Con-sequently, there is no need to make any conces-sion on the issue of one China. In mid-February,the president said that his “lawyerly character”has given him the necessary pragmatism tohandle Cross-Strait relations. He emphasizedthat the table is set and the tea is ready. He againinvited leaders of the PRC to resume talks withTaiwan.

The above is based on a collection of policystatements made over the last nine months byleaders and officials of the DPP government. Eversince May 20, 2000, the DPP government—in-cluding the Presidential Office, the ExecutiveYuan, and the MAC—has not made public a singlecomprehensive policy paper that explains clearlyand thoroughly its approach to Cross-Strait rela-tions. The media, academia, and the oppositionparties have had to make guesses about what theDPP government wants to do next.

Obviously, some of its assumptions are flawed.First, responding to the one-China principle doesnot mean making concessions to the PRC butmerely acknowledging an obligation derived fromthe Constitution. All four former presidents ofthe Republic of China in the past 50 years ad-hered to that principle and did not surrender tothe PRC. As president of the ROC, Chen shouldhave understood the history and reasoning verywell. By evading that duty he is apparently ne-glecting his mandate. On the other hand, accord-ing to the 1992 Consensus, Taiwan is entitled toa different interpretation of the term “oneChina,” and the only interpretation of one Chinapermitted by the Constitution is the Republic ofChina. This interpretation is obviously not ac-ceptable to the PRC, but neither is the PRC’s of-ficial interpretation of one China acceptable toTaiwan. Both of them have to settle their differ-ences according to the 1992 Consensus. That isprecisely the usefulness of the 1992 Consensus—agree to disagree.

Second, the resumption of Cross-Strait talksis possible only when the one-China issue is re-

solved, shelved, or at least managed. Meanwhile,the resumption of talks would facilitate the es-tablishment of the three links wanted so eagerlyby Taiwan’s business community. Consequently,the current inaction on the part of the DPP gov-ernment is not in the interest of Taiwan. In ef-fect, the status quo—namely, the official “go slow”policy—is most unfavorable to Taiwan’s interestin the sense that the PRC could get the capitaland talent it wants from Taiwan without givinganything in return. Instead, Taiwan sits there,unable to do anything about the westward flowof capital and talent. Even President Yuan T. Leesaid that time is not on Taiwan’s side.

Third, the entry of Taiwan and the PRC intothe WTO and the negotiations on the three linksare not necessarily connected. The PRC’s admis-sion has been stalled because negotiations withthe European Union have not resolved differ-ences. Even if both sides enter the World TradeOrganization this year, there is no guarantee thatCross-Strait negotiations would automaticallytake place right away. The PRC could still insistthat the one-China issue be resolved first. There-fore, the issue cannot be evaded. Taiwan has tofind a way to handle it when it joins the WTObefore the end of this year, as is generally ex-pected. It seems pointless for the two sides to waituntil they have entered the WTO to begin nego-tiations. If they do, it would only cause furtherdelays in improving Cross-Strait relations.

Fourth, going back to the 1992 Consensus orbeginning to negotiate the three links does notmean any concession to the PRC. As pointed outearlier, the ROC Constitution is a one-China con-stitution. Furthermore, Taiwan business peoplewant to trade with and invest directly in the Chi-nese mainland. It is in the interest of Taiwan toexpand economic relations with the mainland andto inject some orderliness into the status quo. Theprocess would involve expansion, not concessions.

Fifth, whether there will be problems inCross-Strait relations in the coming year isanybody’s guess. But one should keep in mindthat the 16th Congress of the Chinese Commu-nist party will take place in October 2002. Presi-

154 Ying-jeou Ma


dent Jiang Zemin’s potential competitors couldcriticize his performance on two fronts: U.S.–PRCrelations and Cross-Strait relations. It is onlynatural for him to take a strong and inflexiblestance as the date approaches for the congress toconvene. On the other hand, the next presiden-tial election in Taiwan will be held in March 2004,and the election campaign will begin no later thanthe fall of 2003, if not earlier. The candidates willnot want to look weak in their advocacy of policytoward the PRC. Consequently, the years 2002and 2003 will not be suitable for such ice-breakingtalks by senior officials on either side. The year2001 is the only year that offers an opportunityto the two sides of the Taiwan Strait to resolvetheir differences with minimal influence fromdomestic factors. Given that mutual trust has notbeen established, there is much confidence build-ing still to be done. It is imperative for the twosides to make meaningful efforts to break thestalemate this year. Inaction in improvingCross-Strait relations could cost Taiwan dearlyin lost opportunities.

The DPP Government’s New Three-No’sin Policy Formulation: No Consistency,No Coherence, and No Vision

The general impression of the DPPgovernment’s mainland policy and its implemen-tation is that it is rife with inconsistency and in-coherence. The flip-flop on the 1992 Consensusin June 2000, as stated above, is only one exampleof policy inconsistency; there have been manymore. The discrepancies in the president’s andthe vice president’s remarks on Cross-Strait re-lations, between those of the president and theMAC, between those of the vice president and theMAC chairwoman, the DPP chairman and secre-tary general, and DPP headquarters and its Leg-islative Yuan caucus appear so frequently in themedia that few people really understand what thethrust of the DPP government’s mainland policyis. In addition, the MAC, the Cabinet agency incharge of the formulation of mainland policy, has

not published a single policy paper that clearlyoutlines the DPP government’s goals, strategy,and implementation timetable. It is generallyrecognized that this can be attributed to theDPP’s ideology-oriented decision-making process.President Chen told a foreign journalist that heis an “ethnic Chinese,”44 giving the impressionthat he is a resident of Chinese descent in a for-eign country. Premier Chang did no better whenhe was asked whether he was Chinese. He said,“something similar to that.”45 The result of suchkinds of decision making oriented in ideology is alack of vision and direction and much distortion.In other words, as long as there is no immediatethreat across the Taiwan Straits and the UnitedStates is pleased, the DPP government is reluc-tant to take any action to improve Cross-Straitrelations, let alone touch the issue of one China.

The Inability to Make Proper Responses

In the past nine months the PRC has gener-ally adopted a “listen to what he says and watchwhat he does” attitude, but it has occasionallymodified certain policies regarding Taiwan. Forinstance, the PRC’s Vice Premier Qian Qichensaid during an interview with The WashingtonPost in early January 2001, there is only oneChina, China is composed of the mainland andTaiwan, and China’s sovereignty and territorycannot be divided.46 He also said that the one-China, two-systems formula still leaves someroom for discussion. This is obviously intendedto dispel doubts that one China means only thePRC and that one country, two systems is aone-size-fits-all formula for Hong Kong and Tai-wan. Part of the new wording on one China isalmost identical to that in the National Unifica-tion Guidelines.47 Many people believe that PRCVice Premier Qian quietly accepted the NUG’sdefinition of one China. Meanwhile, there seemsto be a certain flexibility in the stringent one-country, two-systems formula. In addition, thePRC has also quietly changed its policy regard-ing the visits of Taiwan’s local government offi-



cials in their official capacity. In the past, offi-cials from Taiwan who were visiting the Chinesemainland were invariably addressed as “Mr./ Ms.So-and-So,” not by their official titles. They werereferred to not as officials but as “well-knownpersonalities from Taiwan.” Now they are ad-dressed by their official titles. When BaiHsiung-hsiung, deputy mayor of Taipei, visitedShanghai in September of last year and in Feb-ruary of this year, he was invariably addressed asdeputy mayor. Feng Guoqin, Shanghai’s deputymayor, who visited Taipei in early January 2001,had no difficulty in addressing the author as“Mayor Ma.” This is a far cry from the situationthat existed barely one year ago.

Unfortunately, the DPP government did notgrasp the opportunity to respond properly. Itcould have said in public that Taiwan welcomessuch statements and made corresponding sugges-tions for improving Cross-Strait relations. On theother hand, the MAC could also have taken ad-vantage of the PRC’s new attitude to make newregulations governing the exchange of local gov-ernment officials across the Taiwan Strait. Forinstance, DPP Chairman Frank Hsieh, currentlythe mayor of Kaohsiung City, was invited by themayor of Xiamen (Amoy) to visit that city, buthis application, submitted to the MAC in July2000, is still pending in the MAC. It was reportedthat President Chen had received a confidentialintelligence report that Mr. Hsieh’s itinerary inthe Chinese mainland included several improperactivities that could fall into the PRC’s “united-front” trap. One can only come to the conclusionthat the DPP government is only interested inpleasing the Americans but not interested in im-proving Cross-Strait relations. All indications arethat such a policy cannot last for long.

On the other hand, it is not fair to blame theDPP government alone for its inability to makeproper responses. The PRC should be blamed aswell because it too has failed to respond properlyon at least three occasions: President Chen’s in-augural address, the inauguration of the threemini-links, and President Chen’s Cross-CenturyRemarks. Had the leaders of the PRC said in pub-

lic that they considered these statements or ac-tions positive and they were willing to pursuethem further, President Chen would have beenencouraged to continue along the same lines. Pre-cisely because of inaction on the part of the PRC,the only advice President Chen received from hismainland affairs advisers was not to proceed fur-ther and to take a wait-and-see attitude. Such anunfortunate retrogression is clearly due to unfa-miliarity and a lack of mutual trust. It will takeboth time and further exchanges to develop fa-miliarity and trust. The key is for each side togive the other the benefit of the doubt and to re-spond positively whenever an opportunity arises.

Breaking the Impasseand Making a Breakthrough:A Conscientious Proposal tothe DPP Government

Going Back to the 1992 Consensus

The DPP’s Taiwan Independence Party Char-ter makes accepting the one-China principle ex-tremely difficult. But unless such a principle isaccepted, there is no possibility that the two sideswill resume the talks between SEF and ARATSthat have been interrupted since 1995. The DPPgovernment is feeling pressure to take action. Infact, it could not be otherwise for the ruling partyof the ROC. Even President Chen and ChairmanFrank Hsieh of the DPP agree that the ROC Con-stitution is a one-China constitution, whetherthey like it or not. The DPP fears that once Tai-wan accepts the one-China principle, it will fallinto the hands of the PRC. Consequently, theparty refuses to budge. If pressure were insur-mountable, then party leaders would delay thedecision as long as possible. In fact, all these prob-lems are fraught with difficulty but were thor-oughly discussed nine years ago in the NUC Re-search Group and in the MAC. The conclusion

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was a middle-ground solution, namely, the 1992Consensus—one-China with different interpre-tations by each side. This formula balances theconstitutional requirement of one China and theCross-Strait reality of two political entities. It isflexible enough to give both sides room to ma-neuver but not too flexible to deviate from theone-China principle. If President Chen acceptsthe 1992 Consensus, he would not compromisethe ROC’s sovereignty and dignity because theconsensus not only conforms to the ROC Consti-tution but would also improve Cross-Strait rela-tions because he would be honoring a commit-ment Taiwan made nine years ago.

Restore the Operation of the NationalUnification Council, or Combine theCouncil with the Cross-Party Group

The existence of the NUC has vital symbolicmeaning in the Cross-Strait context. The PRChas never liked it; its propaganda machine usedto criticize it as the National NonunificationCouncil. The NUC nevertheless conveys a clearsense that Taiwan has not abandoned the goal ofChina’s reunification and plans to pursue thatgoal, although current differences in ways of lifeof the two sides make it difficult, if not impos-sible, now to set a timetable for China’s eventualreunification. This is the only nexus that couldhold the two sides together politically. The ab-sence of such a nexus would make peace and sta-bility across the Taiwan Strait even more remote.Therefore, President Chen should consider act-ing as the NUC’s chairman or combine the NUCand the Cross-Party Group and act as the headof the new organization. He could expand thecomposition of these organizations to includeTaiwan independence supporters if they are will-ing to join. If the operation of the NUC is restored,or if the NUC and the Cross-Party Group are com-bined and President Chen acts as its head, themessage being sent would be loud and clearenough to neutralize the opposition parties inTaiwan and reduce tension across the Taiwan

Strait. Moreover, the chances of resuming theKoo–Wang talks would be much greater, if notvirtually certain.

Resume the Long- Interrupted TalksBetween SEF and ARATS

If the steps above are implemented, thereshould be much less difficulty in resuming thetalks between SEF and ARATS. The first step isto reextend the invitation by SEF to Mr. WangDaohan, president of ARATS, to visit Taiwan. Thevisit was originally scheduled in 1999, after theSEF’s Koo Cheng-fu visited the mainland in late1998, but was canceled when the “specialstate-to-state-relationship” theory emerged. IfWang accepts the invitation, it will mean that thePRC is ready to talk to Taiwan.

Prepare for Negotiations on the ThreeLinks Together with Questions Relatingto Security Guarantees and InternationalSpace

If Wang Daohan is willing to visit Taiwan,then Taiwan should begin to prepare for compli-cated negotiations on the establishment of thethree links under the WTO framework. Taiwanshould also include in the agenda questions ofsecurity guarantees in the Taiwan Strait andTaiwan’s international space. The negotiationswould take at least two years because they in-volve the conclusion of at least five agreementson air transport, ocean transport, postal links,trade, and investment guarantees, among otherpotential agreements. These agreements wouldbe entered into by two political entities on anequal footing and not by sovereign nations. Ac-cording to Taiwan’s Statute Governing RelationsBetween the People of the Taiwan Area and thePeople of the Mainland Area (the so-called Main-land Relations Act), these agreements have to beapproved by the Legislative Yuan to become le-gally binding in Taiwan. Subjects such as air



transport and trade are too important to be leftto negotiations between airlines or trading com-panies. After all, there is an authority in chargeand a complete set of laws and regulations in ef-fect on either side of the Taiwan Strait. Agree-ments negotiated between business companieshave to be approved by appropriate ministries orbureaus anyway. Allowing government agenciesto negotiate and conclude agreements wouldmake things much easier. Once the negotiationsbegin, Cross-Strait relations will be back on trackor at least back to the 1993 level when the firstKoo–Wang talk took place.

The issues of security guarantees and inter-national space are too important to be left out ofCross-Strait negotiations, but they will have tobe negotiated separately. They are not only theTaiwan people’s focus of concern but also repre-sent the most sensitive taboo for the PRC. Nev-ertheless, the PRC has indicated many times that,as long as the one-China principle is accepted,anything can be negotiated. Meanwhile, interna-tional space has been a flash point between thetwo sides for many years. A certain broad con-sensus is needed at least to prevent it from get-ting out of control. In any case, the inclusion ofthese two issues would not mean that they arereadily solvable at the moment but would showthe sincerity of both sides to face the issuessquarely.

Prospects for the Future

The past nine months have attested to thecontinuance of the Cross-Strait stalemate thatbegan in 1995. Both sides have maintained await-and-see attitude toward each other. Al-though the chances of confrontation have de-creased, there have been few signs of improve-ment. The interrupted Koo–Wang talks and otherconsultations between SEF and ARATS have notresumed. Meanwhile, Taiwan’s trade with anddirect investment in the Chinese mainland havecontinued to increase rapidly, ignoring the go-slowpolicy of the ROC government. For instance,

two-way trade jumped 21 percent from U.S. $25.9billion in 1999 to U.S. $31.3 billion in 2000, witha surplus of almost U.S. $20 million in Taiwan’sfavor.48 Investment stood at U.S. $48 billion, withmore than 40,000 Taiwanese companies invest-ing in the Chinese mainland.49 Even the high-techindustry in the Hsinchu Science-Based IndustrialPark, Taiwan’s Silicon Valley, located 78 kilome-ters southwest of Taipei, showed increasing in-terest in investing in the Chinese mainland. Ineconomic affairs, Taiwan’s competitive edgevis-à-vis the Chinese mainland is facing a seri-ous challenge.

On the other hand, the rise of the DPP toruling party status changed the political land-scape of Taiwan but did not enhance the qualityof politics or government efficiency. The past ninemonths also saw the difficulties and frustrationsof a minority president fighting on three fronts:the opposition parties (KMT, PFP, and NP), hisown party (DPP headquarters and the Legisla-tive Yuan caucus), and the other side across theTaiwan Strait (the PRC). President Chen did wellin his inaugural address by announcing the FiveNo’s. But what followed was less than satisfac-tory. Many factors contributed to the inconsis-tency and incoherence of President Chen’s ap-proach to Cross-Strait relations during this pe-riod, the most important being the ideology un-derlying the DPP’s Party Charter, namely,Taiwan independence. The flip-flop on the 1992Consensus is a typical example. That is why thePRC still considers him to be a “soft” TI sup-porter.

A consensus is quietly building among manyknowledgeable people in Taiwan—officials, aca-demicians, and business people alike—that timeis not on Taiwan’s side and that maintaining thestatus quo is not in Taiwan’s interest. The DPPgovernment’s grand strategy, designed not to pro-voke the PRC, is appropriate but hardly sufficientto break the stalemate across the Taiwan Straitand steer the course of events in Taiwan’s favor.Something positive has to be done and done prop-erly in a timely and consistent manner to changethe atmosphere so that a benign rather than a

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vicious cycle can emerge in Cross-Strait relations.In spite of all these difficulties, President

Chen’s New Year message could fundamentallychange the course of the DPP government’s ap-proach to Cross-Strait relations, if he is able topush it through. His blueprint for the future ofTaiwan and the PRC is a “political structurebased on eternal peace and political integration.”This formula is broad enough to cover almost allpossible scenarios, including those of the opposi-tion parties but not that of the TI fundamental-ists, for the ultimate future of Taiwan and thePRC. It could mean federation, confederation, acommonwealth of states, or even a EuropeanUnion–type of association. As a matter of fact,the second phase of Cross-Strait relations underthe National Unification Guidelines, which thethree opposition parties support, can be calledthe integration phase, in which the two sides willestablish official relations, initiate the three links,and begin regular exchange visits betweenhigh-ranking officials. To make the new conceptworkable, however, President Chen must firstdevelop a comprehensive and coherent policy andstrategy and speak and act consistently in thefuture. Second, he has to coordinate DPP offi-cials in the Executive Yuan and party officials inthe DPP headquarters and in the DPP caucus inthe Legislative Yuan to make sure that they allagree with him on this concept. Third, he has tobring the opposition parties into theconsensus-building process in future dealingswith the PRC. Fourth, he has to propose the ini-tiative in a more concrete form at a proper timeto engage the PRC. All these efforts will be diffi-cult to accomplish but are worth trying. After all,whether President Chen handled Cross-Straitrelations well will be one of the most importantcriteria in assessing the success or failure of hispresidency.

If President Chen is able to do so, it couldalso usher in a new strategic scenario affectingregional stability in East Asia. In the interna-tional arena, Cross-Strait “political integration”could mean a regional role for Taiwan, disassoci-ated from right-wing Japanese forces, in build-

ing a “contained China” united front and in avoid-ing an arms race with the PRC. Taiwan could thenplay a role in fostering Sino-Japanese detente andpromoting the growth of a stability-oriented EastAsian regionalism.50 On the Cross-Strait front,political integration could mean the process ofbuilding a loosely associated new entity composedof Taiwan, the PRC, Hong Kong, and Macao basedon economic, cultural, and other kinds of inte-gration. This would mean the demise of the ac-tive nation-building efforts some have vigorouslypursued in the past in Taiwan. On the other hand,for Taiwan and the PRC, this new form of asso-ciation could deliver both independence and re-unification at the same time. Of course, the newarrangement would involve a decision that notonly President Chen would make but one thatwould pose a common challenge to all the peopleof Taiwan and the Chinese mainland.

The stability of Cross-Strait relations in thenext three years depends a lot on how PresidentChen handles it. As the past has shown, his per-sonal character shapes his leadership style, whichin turn determines his policy orientation. In thisregard, let us not forget that President Chen is asupporter of Taiwan independence but not a fun-damentalist. He is a pragmatist, not an ideologue.One should not overestimate his political beliefsnor underestimate his flexibility in handlingCross-Strait relations. His inaction at the momentcould mean that he is waiting for the opportunetime to make necessary adjustments, just as hedid in the controversy over the continued con-struction of the Fourth Nuclear Power Plant awhile ago.

About the Author

Dr. Ying-jeou Ma, mayor of Taipei City,earned his LL.B, LL.M., and S.J.D. degrees fromNational Taiwan University, NYU, and HarvardLaw Schools. He was executive secretary of theMainland Affairs Commission of the ExecutiveYuan (Cabinet) of the Republic of China (ROC)government during 1988–1991 and senior vice



chairman of the Mainland Affairs Council (MAC)during 1991–1993. He later became minister ofjustice (1993–1996), minister without portfolio(1996–1997), and associate professor of interna-tional law at National Chengchi University(1997–1998). He was elected mayor of Taipei inDecember 1998. Dr. Ma was one of the architectsof Taiwan’s mainland policy institutions and leg-islation. He is the author of several books andarticles on Cross-Strait relations, includingLiangan quanxi de huigu yu qianzhan(Cross-Strait Relations: A Review and an Outlook.Taipei: Mainland Affairs Council, 1992 [in Chi-nese]); “Taipei-Beijing Relations and East AsianStability: Implications for Europe,” NATO Re-view, vol. 41 (1993), pp. 29–33; and “Policy To-ward the Chinese Mainland: Taipei’s View,” inStephen Tseng, ed., In the Shadow of China (Lon-don: Christopher Hurt’s & Co., 1993), pp. 193–211. He has attended several “track-two” meet-ings of the Council on Foreign Relations and theNational Committee on American ForeignPolicy’s Roundtable on U.S.–China Policy andCross-Strait Relations during 2000 and 2001.

Notes

1 “Zhongtong daxuan chenshuibiandangxuan, zhengquan biantian, guomindangxiaye” (“Chen Shui-bian Elected, AdministrationChanged Hands, KMT Lost Power”), Lianhe Bao(United Daily News), March 19, 2000, p. 1; “De-cision in Taiwan: Taiwan Nationalist Ousted Af-ter Half-century Reign,” The New York Times,March 19, 2000, p. A1.

2 “Tangfei qingci duowei shouzhang gandaokexi, Linjunyi buyuan huiying” (“Tang Fei Re-signs; Many Cabinet Members Express Regret;Lin Junyi Declines Comment”), Taiwan Ribao(Taiwan Daily News), October 4, 2000, p. 2.

3 “Tsai Ying-wen: liangguolun zhongyaomuliao” (“Tsai Ying-wen: The Key Staff Mem-ber for the State-to-State Theory”), Lianhe Bao(United Daily News), April. 12, 2000, p. 3.

4 “Meilianshe qian ershida xinwen

paihangbang chulu, Taiwan bangshang youming”(“Taiwan Is on the List of AP Top Twenty NewsItems), Central News Agency, Dec. 26, 2000.

5 President Chen’s Profile, The Office of thePresident of the Republic of China Website,<http://www.oop.gov.tw/1_president/index.html>.

6 “Ma yingjiou, Xie changting dangxuan”(“Ma Ying-jeou and Hsieh Chang-ting Elected”),Zhongyang Ribao (Central Daily News), Decem-ber 6, 1998, p. 1; “Nationalists Oust Taipei Mayorin Vote Watched by China,” The New York Times,December 6, 1998, p. A6.

7 “Chenshuibian: quanming zhengfu tixianxinzhongjian luxian” (“Chen Shui-bian Says AllPeople’s Government Embodies New MiddleRoad”), Zhongguo Shibao (China Times), Janu-ary 19, 2000, p. 4.

8 “Chenshuibian: liangan tanpan yizhongshi yiti fei qianti” (“Chen Shui-bian Says inCross-Strait Negotiation, One China Is a TopicRather Than a Precondition”), Zhongyang Ribao(Central Daily News), March 21, 2000, p. 3.

9 Lifayuan gongbao (Legislative Yuan Bul-letin), vol. 80, issue 24, no. 2448, March 22, 1991,pp. 201–204.

10 “Weilai liangan guanxi ren manbu jingji”(“Still a Bumpy Road Ahead for Future Cross-Strait Relations”), Zhongguo Shibao (ChinaTimes), March 14, 2000, p. 1.

11 “Dui Taiwan xin lingdaoren yi tingqiyanguanqixing” (“Taiwan’s New Leader, PRC ShouldListen to What He Says and Watch What HeDoes”), Wenhuibao, March 19, 2000, p. A3.

12 Shui-bian Chen, Victory speech after thepresidential election, March 18, 2000, <http://www.oop.gov.tw/1_president/index_e.html>.

13 “Chenshuibian: wuerling hou lianganguanxi ke youxiao gaishan” (“Chen Shui-bainSays Cross-Strait Relations Can Be ImprovedMarkedly After May 20”), Lianhe Bao (UnitedDaily News), May 17, 2000, p. 1.

14 “Zuixin mindiao xianshi Chenshuibianbiaoxian liuchengwu minzhong manyi” (“TheLatest Poll Shows 65% Approval Rate for ChenShui-bian), A survey conducted in May 2000,

160 Ying-jeou Ma


China Times Website <http://www.chinatimes.com.tw/report/abian2000/89508p50.htm>.

15 “Jiouzhi manyue jizhehui hou, chenzongtong shengwang shangsheng daoqichengjiou” (Poll Shows President Chen’s Ap-proval Rate Rises to 79% After His One-Month-in-Office Press Conference), Lianhe Bao (UnitedDaily News), June 22, 2000, p. 2.

16 Shui-bian Chen, Inaugural Speech, May20, 2000, <http://www.mac.gov.tw/english/MacPolicy/cb0520e.htm>.

17 Presidential Press Conference, June 20,2000, The Office of the President of the Republicof China Website, <http://www.oop.gov.tw/1_president/index.html>.

18 “Chen zongtong jieshou yige zhongguogezi biaoshu? Minjindan liwei chijing, zaiyedangkending” (“President Chen to Accept ‘One Chinawith Different Interpretations?’ DPP Law Mak-ers Stunned While Opposition Parties Ap-plauded”), Ziyou Shibao (The Liberty Times),June 29, 2000, p. 2.

19 Mainland Affairs Council’s Press Confer-ence, June 28, 2000, MAC Website, <http://www.mac.gov.tw/cnews/cnews89062803.htm>.

20 “Tsai Ying-wen: jiouer nian lianganhuitan gongshi, wofang renzhi shi gezi biaoshuyige zhongguo” (“Tsai Ying-wen Says the Con-sensus Reached by the Two Sides in 1992 Was‘Each Side Differently Interprets One China’”),Gongshang Shibao, July 7, 2000, p. 11.

21 “92 gongshi, haijihui wenjian mingzheng”(“92 Consensus: One SEF Document ClearlyProves It”), Zhongyang Ribao (Central DailyNews), October 25, 2000, p. 4.

22 “Guwang huitan yibo sanzhe, qioutangcuoshang juechu fengsheng” (“Koo–Wang TalksEncounter a Variety of Barriers, Chiou-TangMeeting Rises from Death”), Ziyou Shibao (TheLiberty Times), April 29, 1993, p. 2.

23 Presidential Press Conference, July 31,2000, The Office of the President of the Republicof China Website, <http://www.oop.gov.tw/1_president/index.html>.

24 “Tsai Ying-wen: weijian zugo minzhongzhichi yizhong yuanze” (“Tsai Ying-wen Says Not

Enough Support for One China”), ZhongyangRibao (Central Daily News), October 21, 2000, p.2.

25 “Tsai Ying-wen: jinma xiaosantongxiwang niandiqian shishi” (“Tsai Ying-wen SaysKinmen and Matsu Hope for Mini-Three Linksto Be Implemented Before Year End”), LianheBao (United Daily News), June 5, 2000, p. 1.

26 China Yearbook, 1958–59 (Taipei, ChinaPublishing Co., 1959), pp. 2–3.

27 “Liangan xiaosantong yingxiang pinggu jiguihua fangxiang” (“The Impact of Evaluationand Direction Setting on the Mini-Three LinksBetween the Two Sides”), MAC Website, Octo-ber 2, 2000, <http://www.mac.gov.tw/economy/em1002.htm>.

28 Zohongguo Shibao (China Times), Janu-ary 2, 1979, p. 1.

29 “Liangan xiaosantong jinma jin zhengshiqihang” (“The Mini-Three Links Kicks Off To-day at Kinmen and Matsu”), Lianhe Bao (UnitedDaily News), January 2, 2001, p. 1.

30 MAC Website, <http://www.mac.gov.tw>.31 “Matsu mindai mifu Fuzhou xieshang,

Luweihui chen wei shouquan, wu falu xiaoli”(“Matsu’s Elected Representative Sneaked toFuzhou to Negotiate. The Mainland Affairs Coun-cil Said the Agreement Had No Authorization,Hence No Legal Force”), Lianhe Bao (UnitedDaily News), January 29, 2001, p. 1.

32 “Matsu Mawei jiaoliu xieyi shu minjiangotong” (“Accord Between Matsu and Mawei IsPrivate-Sector Communication”), ZhongguoShibao (China Times), January 30, 2001, p. 4.

33 “Kuadangpai xiaozu jianyi Chen zhong-tong yixian huiying duian yizhong zhuzhang”(“Cross-Party Group Suggests that PresidentChen Respond to the PRC’s ‘One-China’ Stancein Accordance with the Constitution”), Zo-hongguo Shibao (China Times), November 27,2000, p. 1.

34 “Dui kuadangpai xiaozu sanrenzhi sijianyiBeijing pingwei wenzi youxi, luweihui yihan”(“MAC Regrets Beijing Considers the Cross-PartyGroup’s Three Understandings and Four Sugges-tions a Game of Words”), Zhongguo Shibao



(China Times), December 1, 2000, p. 1.35 The Office of the President of the Repub-

lic of China Website, <http://www.oop.gov.tw/1_news/index_e.html>.

36 “Tonghelun Tsai Ying-wen zhi yuzongtong wu qijian” (“Tsai Ying-wen Says Sheand the President Have No Different Views onthe Integration Theory”), Lianhe Bao (UnitedDaily News), January 20, 2001, p. 4.

37 “Chi-yuan Lin, Hesi juice cuowu, Renminsunshi canzhong” (“The Wrong Decision Makingon the Fourth Nuclear Plant Cost Heavily”),January 8, 2001, National Policy FoundationCommentary, <http://www.npf.org.tw/Publica-tion/FM/090/C/FM-C-090-004.htm>.

38 Unemployment rate in January 2001,Directorate-General of Budget, Accounting andStatistics Website, < http://www.dgbasey.gov.tw/>.

39 “Shangyue zhongda touzi jiao qunientongqi shuaitui 50%” (“Large Domestic Invest-ment Cases in January Dropped 50% Comparedto Last Year”), Lianhe Wanbao (United EveningNews), February 21, 2001, p. 7.

40 A survey conducted by China Times onDecember 28, 2000, <http://news.sina.com.tw/sinaNews/chinatimes/CFOCUS/2000/1231/2509263.html>.

41 A survey conducted by TVBS Poll Center,February 26–27, 2001, <http://www.tvbs.com.tw>.

42 “Editorial, Jinian pingkong xiaoshi de 137tian” (“In Memory of the 137 Days that VanishedWithout Reasons”), Zhongguo Shibao (China

Times), February 21, 2001, p. 2.43 “Luxiulian: liangan buxu guwang hui zou

houmen” (“Lu Hsiu-lien: No Need for Koo–WangTalks to Walk Through the Back Door”),Zhongguo Shibao (China Times), December 6,2000, p. 2.

44 “Chen zongtong: woshi taiwanren, ye yizuo huaren weirong” (“President Chen Says “IAm Taiwanese and Proud to Be Ethnic ChineseAs Well”), Lianhe Bao (United Daily News), Oc-tober 18, 2000, p. 2.

45 “Zhangkui: zhongguo liangzi fanzheng-zhihua, bugan suibianyong” (“Premier ChangSays the Word “China” Has Been Over Politicizedand He Will Not Use It Lightly”), ZhongguoShibao (China Times), October 21, 2000, p. 2.

46 “Beijing Signals New Flexibility on Tai-wan; Comments Appear Aimed at Bush,” TheWashington Post, January 5, 2001, p. A1.

47 National Unification Guidelines, adoptedby the National Unification Council at its thirdmeeting on February 23,1991, and by the Execu-tive Yuan Council at its meeting on March 14,1991.

48 Cross-Strait Economic Statistics Monthly,no. 88, December 1999, and no.100, December2000, Mainland Affairs Council Website, <http://www.mac.gov.tw>.

49 Ibid.50 “Yun-han Chu, Xinshiji de liangan guanxi

luchu yixian shuguang” (“A New Ray of HopeShed on the Cross-Strait Relations in the NewCentury”), Zhongguo Shibao (China Times),January 8, 2001, p. 2.

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