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SINGAPORE — As preparations are made for Chinese President Hu Jintao’s visit to the United States and a presidential election is scheduled for spring 2008 in Taiwan, there are indications that the next two years could prove challenging for the main parties involved in cross-strait relations — Beijing, Taiwan’s Chen administration and the Pan-Blue opposition coalition, as well as Washington.

Taiwan President Chen Shui-bian’s Feb. 27 announcement — which likely took Washington and Beijing by surprise — that he would scrap the National Unification Council (NUC) and the National Unification Guidelines (NUG) has raised the stakes across the Taiwan Strait.

There are two likely reasons why Chen made such a bold move. First, he rushed this announcement through on the eve of the 2-28 commemoration, a key date for the Taiwanese independence lobby that marks when Kuomintang (KMT) troops killed local Taiwanese in 1949 as they occupied the island. Second, the American Institute in Taiwan (AIT) Representative Douglas Paal (who reputedly “controlled” Chen on behalf of the U.S. State Department) had left, and his successor, Stephen Young, whom many thought would take a less hardline position toward Chen, had yet to arrive. Chen could thus have been testing Washington as well.

The scrapping of the NUC carried more symbolism than substance as it had been moribund since Chen took power in 2000. The termination of the NUG, however, could raise cross-strait tensions because if its clauses cease to apply to cross-strait relations, the thorny issue of infringement upon the “territorial integrity of China” could be raised. In fact, the announcement of military exercises by both Taiwan and China have increased the ante.

In addition, Chen’s announcement probably reflected his feeling of being snubbed by Beijing because it refuses to recognize or meet him despite overtures on his part.

Chen also strategically timed his announcement to take place just before the opening of the annual legislative National People’s Congress/Chinese People’s Political Consultative Conference in Beijing; it was in this session a year ago that China’s Anti-Secession Law aimed at Taiwan — which sparked protests from Washington and Europe — was endorsed.

Fearing a Sino-American entente, Chen also likely decided to push his point as a prelude to the upcoming meeting between U.S. President George W. Bush and Hu. The Americans do not want Chen to “rock the boat” (Washington issued stern warnings to Chen after he made speeches on Jan. 1 and Jan. 29 advocating a tough line toward China), as the U.S. still hopes Beijing will become a “responsible stakeholder” and cooperate with Washington in dealing with global hot spots from Pyongyang to Tehran to Yangon.

China’s reaction to Chen’s move to scrap the NUC and NUG was swift. It complained to U.N. Secretary General Kofi Anan and proposed to increase its military spending. But Beijing will likely continue its successful “hard, harder; soft, softer” policy on Taiwan — seeking to “win the hearts and minds” of the majority of Taiwanese, while dealing harshly with Chen and his independence lobby.

Beijing has surmised that Chen will now want to challenge the Chinese leadership, especially after he appointed, just before the Lunar New Year, a Cabinet that Beijing considers to be more hardline than the one it replaced. Beijing could decide to discreetly increase its support of Taiwan’s Pan-Blue opposition coalition forces, notably KMT Chairman Ma Ying-jeou, whom Beijing secretly hopes will win Taiwan’s next presidential election.

For his part, Chen knows that he will have to react fast against any moves by Beijing before he becomes totally irrelevant in two years’ time when he retires. He could decide to take on Beijing squarely by forcing it to react to his surprise moves.

Caught in the middle is Washington, whose efforts to prevent Chen from rocking the boat may be failing. Washington will certainly have to do more to convince Beijing that it has Chen effectively “under control.” In fact, Beijing may already be questioning whether Washington can persuade Chen to maintain the status quo, as was assumed last year when Beijing and Washington came to a strategic understanding during three rounds of strategic talks, as championed by U.S. Deputy Secretary of State Robert Zoellick.

China will certainly want to engage Washington even more so now over Taiwan as both sides organize Hu’s state visit to the U.S. Ma, who just visited America, seems to be swinging toward Washington and Beijing’s side against Chen. The timing of Ma’s visit to Washington (just weeks before Hu’s) and his long meeting with Zoellick not only confirms Washington’s pivotal role in cross-strait relations, but has prompted fears in Taipei that Bush may make a surprise move against Chen during in his April 20 White House meeting with Hu.

A “united front” consisting of the Taiwanese opposition, Beijing and Washington could be disastrous for Chen and the wily Taiwanese leader can be expected to do all he can to thwart this effort. Taiwan’s Mainland Affairs Council already announced on March 22 that it would tighten economic and investment procedures across the strait. Though Chen has promised new AIT Director Young that there would be “no surprises,” this ongoing tussle has heightened the stakes across the Taiwan Straits and may threaten regional stability before Chen’s term ends.

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