Diplomacy across the Taiwan Strait: From competition to cooperation?

East Asia

Volumn 21, Issue 1, 2004, Pages 24-39

  Chan, Gerald ^a  

^a NONE

Author keywords

[No Author keywords available]

Indexed keywords

DIPLOMATIC RELATIONS; GEOPOLITICS; INTERNATIONAL COOPERATION; INTERNATIONAL RELATIONS;

ASIA; CHINA; EASTERN HEMISPHERE; EURASIA; FAR EAST; TAIWAN; WORLD;

EID: 13744263361     PISSN: 10966838     EISSN: None     Source Type: Journal    
DOI: 10.1007/s12140-004-0008-9     Document Type: Article

References (58)

1. Mainland Affairs Council, Taipei, www.mac.gov.tw.
2. These figures are derived from the Board of Foreign Trade in Taipei, quoted in The Standard (Hong Kong), (1 January 2004), A6. The total volume of trade across the Strait in 2003 rose 23.8% on year to US $46.3, with Taiwan exporting US $35.3 billion worth of goods to China and importing US $11.0 billion. Dow Jones (11 March 2004);
3. International Herald Tribune (14 March 2004), 17.
4. China's trade with Japan in 2002 was worth US $102 billion, and trade with Hong Kong in the same year was US $69 billion. The figure for Taiwan was US $44.6 billion, just slightly ahead of South Korea's US $44 billion. Figures given by P. K. Chiang, Vice-President of the Legislative Yuan of Taiwan, in his paper entitled 'Mainland China's economic rise, its impact on East Asia's economies, and Taiwan's economic strategy in response,' presented at a conference on Taiwan and East Asian international relations at the University of Cambridge, 13 October 2003.
5. These travel figures are taken from Craig Meer and Macabe Keliher, 'Taiwan's economic leverage over China,' Asian Wall Street Journal Internet ed., (12 August 2003).
6. According to another source, in 2001 Taiwanese made 3.14 million trips to China, while mainland Chinese made 103,000 trips to Taiwan. The corresponding figures in 2002 rose to 3.61 million and 139,000, an increase of 15% and 34% respectively. All these figures were those recorded before the outbreak of SARS in early 2003. The Strait Times (Singapore), quoted in International Herald Tribune (14-15 February 2004), 2. Note that the people from Taiwan make more multiple visits to the mainland than the other way around.
7. Meer and Keliher, 'Taiwan's economic leverage over China.'
8. This forms the focus of this paper. For a useful theoretical overview of different ways to look at cross-Strait relations in their totality, see Wu Yu-shan, 'Theorizing on relations across the Taiwan Strait: nine contending approaches,' Journal of Contemporary China 9:25 (November 2000), 407-28. The nine approaches are: the divided-nation model, integration theory, the power asymmetry model, the vote-maximising model, the developmental state paradigm, strategic triangle theory, systems theory, political psychology theory, and the cognitive approach.
9. Cal Clark, 'Growing cross-Strait economic integration,' Orbis 46:4 (Fall 2002), 755-7.
10. Gady A. Epstein, 'Business forges links for China, Taiwan: economics and migration affect political dynamic,' The Baltimore Sun, Internet ed., (11 March 2004).
11. Unemployment in Taiwan is at an all-time high. Throughout the 1980s and 1990s, its jobless rate averaged under 2% and never rose above 3%. In 2001 it soared abruptly to 4.57%, and in 2002 hit a record high of 5.17%. The average rate in the first eight months of 2003 was 5.08%. Chiang's presentation at Cambridge, 13 October 2003.
12. Discussion with two Taiwanese scholars at a conference on the military balance and decision-making across the Taiwan Strait, held at St. Antony's College, Oxford, 28-29 February 2004.
13. Xinhua News Agency (17 May 2004). For a full text of the statement in English, see [www.china.org.cn/english/2004/May/95545.htm]. For a Chinese text, see [www.china.org.cn/chinese/2004/May/965235.htm].
14. 'Reunification law to be considered,' South China Morning Post, Internet ed., (12 May 2004);
15. 'Support grows for "invasion legislation",' South China Morning Post, Internet ed., (13 May 2004).
16. See Note 4 above.
17. Tung Chen-yuan, 'Cross-Strait economic relations: China's leverage and Taiwan's vulnerability,' Issues & Studies 39:3 (September 2003), 137-75.
18. It is the biggest overseas investor in China, ahead of the U.S. and Japan, according to one U.S. official estimate. See Jason Dean, 'China: challenges ahead,' in Asian Wall Street Journal, Internet ed., (20 October 2003).
19. Taiwan contributes about 20% of the capital flow to China, twice as much as the U.S. See Chao Chien-min, 'Attitudes about PRC have changed,' Taipei Times (2 February 2004), 8.
20. According to the Japan Export Trade Organisation, Japan put in some US $4.2 billion directly into factories and other facilities in China in 2002. The electronics industry accounts for more than 40% of the capital committed by Japanese manufacturers.
21. See International Herald Tribune (17 February 2004), 8. The number of new European-invested companies in China in 2003 rose 39.6% from 2002, faster than the growth rate of 20.7% of U.S.-invested companies. The stock of European foreign direct investment in China at the end of 2002 stood at US $34 billion.
22. See Far Eastern Economic Review, 12 February 2004, p. 29. Among the EU countries, Germany is one of the major investors in China. According to Chinese sources, German direct investment in China between 1979 and 2000 includes 2,421 investment projects with a value of US $12.2 billion (planned direct investment) and US $5,853 million in realised direct investment. This German share of realised direct investment, however, represents only 1.7% of German investments worldwide.
23. See 'Public private partnership (PPP)-Country study China,' German Ministry of Economic Cooperation and Development, [www.bmz.de/ index.html] (accessed 12 March 2004).
24. Gerald Chan, 'Sudpolitik: the political economy of Taiwan's trade and investments in Southeast Asia,' Pacific Review 9:1 (1996), 96-113.
25. Far Eastern Economic Review, (31 July 2003), 17.
26. 'China-based businessmen favour Pan-Blue,' Taipei Times, (1 February 2004), 3.
27. Taiwan Update, Taipei Representative Office in the U.K., May 2004.
28. Joseph Kahn, 'Taiwan casts U.S. as China intermediary,' New York Times, Internet ed., (28 April 2004).
29. The full text of the speech can be downloaded from the website of the Office of the President, Republic of China, at [www.president.gov.tw/ index_e.html]
30. BBC World News, (24 May 2004).
31. The White House press release on Chen Shui-bian's inaugural address, (20 May 2004), at [www.whitehouse.gov/news/releases/2004/05/ 20040520-21.html].
32. Paul Cavey, 'Leaping dragon, trailing tigers? Taiwan, Hong Kong and the challenge of mainland China,' The Economist Intelligence Unit, (May 2003), 15.
33. 'FDI in Taiwan cut by 65% in 2002,'Central News Agency, (6 September 2003), etaiwannews.com.
34. I b i d.
35. China Daily, Internet ed., (12 May 2003).
36. David Hale and Lyric Hughes Hale, 'China takes off,' Foreign Affairs (November/December 2003).
37. Chao Chien-min, a professor at the National Chengchi University, estimates that about 70% of the hardware made by China's IT industry is produced by Taiwanese companies. See his article in Taipei Times, (2 February 2004), 8.
38. Cavey, 'Leaping dragon, trailing tigers?' 22.
39. For a graphical representation of these sunset and sunrise manufactures, see Cavey, 16.
40. Yang Chyan and Hung Shiu-wan, 'Taiwan's dilemma across the Strait: lifting the ban on semiconductor investment in China,' Asian Survey 43:4 (July/August 2003), 681-96.
41. Chiang's presentation at Cambridge, (13 October 2003).
42. Quoted by David Rudnick, 'Business before politics,' The World Today 62:2 (February 2004),23. The same hollowing-out effect with respect to many Southeast Asian countries proves to be short-lived as well, as these countries too have enjoyed a hefty trade surplus with China for a number of years.
43. Leng Tse-kang, 'Globalization and localization of cross-Strait economic relations,' paper presented at the 40th anniversary conference on 'the state of contemporary China', Universities Service Centre for China Studies, the Chinese University of Hong Kong, (6-7 January 2004).
44. Wei Yung, 'From functional integration to structural readjustment: Taipei-Beijing relations and the role of the United States,' paper presented at a conference on 'The United States, China, and Taiwan in a changing world: opportunities and challenges for the 21st century,' University of Denver, USA, (2-3 May 2003).
45. Far Eastern Economic Review, (4 March 2004), 24. Wu Yu-shan's recent writings have affirmed the increasing importance of the effect of bentuhua (localisation, local identity) on the domestic politics of Taiwan. See his presentation at the conference held at the Chinese University of Hong Kong, (6-7 January 2004).
46. For example, Jiang Mianheng, the son of former Chinese President Jiang Zemin, teamed up with Winston Wong, the estranged son of Wang Yung-ching, founder of Taiwan's biggest business group, Formosa Plastics, to found the Grace Semiconductor Manufacturing in Shanghai, with a start-up venture valued at US $1.6 billion to make integrated circuits. See Time magazine, Internet ed., (21 May 2001);
47. Sydney Morning Herald, Internet ed., (28 November 2003).
48. This kind of empirical evidence seems to testify, in an interesting way, to the harmony of interest and the building of bridgeheads in Johan Galtung's theory of structuralism imperialism. See his article in Journal of Peace Research 8:2 (1971), 81-118.
49. Gerald Chan, 'China and the WTO: the theory and practice of compliance,' International Relations of the Asia-Pacific 4:1 (February 2004), fn 10.
50. Discussions at the conference on the military balance and decision making across the Taiwan Strait, Oxford, (28-29 February 2004).
51. For an analysis of some possible collaborations between China and Taiwan in the 2008 Olympic Games, see Gerald Chan, 'From the "Olympic formula" to the Beijing Games: towards greater integration across the Taiwan Strait?' Cambridge Review of International Affairs 15:1 (April 2002), 141-8.
52. Gerald Chan has argued elsewhere the feasibility of using functional approaches to settle cross-Strait differences. See his paper entitled 'Cross-Strait relations: classical realism meets neo-functionalism,' conference proceedings on the theory and practice of international relations, National Chengchi University, Taipei, (5 July 2003);
53. and another paper entitled 'Cross-Strait relations: lessons from the EU experience,' presented at a conference on 'Converting confrontation into cooperation: in search of working peace and sustainable security across the Taiwan Straits,' Taipei, (8 December 2003), [www.peaceforum.org.tw].
54. An abstract of the latter paper appears in Taiwan News, Taipei, [1 December 2003], 12.
55. The exact wording is 'properly addressing, through consultations, the issue of international living space of the Taiwan region commensurate with its status...' see [www.china.org.cn/english/2004/May/95545.htm].
56. Dean, 'China: challenges ahead.'
57. Taipei Times, Internet ed., (20 December 2002).
58. International Herald Tribune, (6 February 2004), 2.