Policy Innovations Digital Magazine (2006-2016): Commentary: Peace Breaks Out in the Taiwan Strait

While the world's attention is focused on wars in Iraq, Afghanistan, and Georgia, a little-observed positive trend is taking place on the other side of the world: Peace has broken out in the Taiwan Strait.

It wasn't so long ago—this spring, in fact—that Taiwan was threatening to hold a referendum that Beijing regarded as a de facto declaration of independence. This, and a number of such actions by former pro-independence President Chen Shui-bian over the past eight years, resulted in saber-rattling in China's capital, which regards Taiwan as a renegade province, and acrimony in Washington, which recognizes Beijing as the sole government of China. The United States switched diplomatic recognition from Taipei in 1979.

But since Taiwan's newly elected, pro-China president, Ma Ying-jeou, took office in May, relations with the mainland—and between Taipei and Washington—have been warming.

Since then:

• Tens of thousands of mainland Chinese tourists are being allowed to fly directly to Taiwan for the first time, ending a decades-long ban;
• Business people are optimistic that direct flights will strengthen economic ties and aid Taiwan's economy, which in its isolation has largely missed out on Asia's explosive growth of the past decade. (The lack of direct ties has been blamed for shaving 1.5 percent off Taiwan's annual economic growth.);
• Taiwan is allowing Chinese investors to buy into its stock markets (starting in October), to invest directly in Taiwan, and to exchange Chinese currency for the Taiwan dollar for the first time;
• Taiwan has proposed a diplomatic "truce" in which neither side will compete for recognition from other capitals; currently 23 countries recognize Taiwan, while 174 recognize Beijing;
• Taiwan has given up its annual bid to join the United Nations as a sovereign state and instead will push for a seat in international organizations such as the World Health Organization.

Next up in a new round of Taiwan-China negotiations scheduled for October: direct shipping links, airspace rights, and fly-beyond rights meaning that a Taiwan airline could stop in China, pick up passengers, and continue on to Europe or elsewhere, rather than return directly to Taipei.

"We are very happy we have a new direction," says Chang Liang-jen, deputy minister of the Mainland Affairs Council, which is Taiwan's government body in charge of handling policies toward China. "In the past we got lost. Now the direction is quite clear," he says. "We are developing a detente, and loosening relations between the two sides."

There's evidence that the warming relations are being felt in China as well: China allowed Taiwan's athletes to compete in the Olympics under the designation "Chinese Taipei" instead of "China-Taipei"—a subtle-but-important distinction in the minds of Taiwanese. Evidence of the popularity of the detente on the mainland was clear during the opening ceremony in August: Taiwan's Olympic team received one of the loudest cheers when marching into the Olympic stadium during the Parade of Nations.

TALKING … BUT WITH A BIG STICK

But despite the warming trend, Taiwan is still pushing for Washington to sell it $12 billion worth of military equipment in a deal that has been held up for some time. Officials in Taipei fear that Washington has frozen the sales because they could potentially antagonize Beijing, a position officially denied by White House officials.

In addition to recognizing the "one-China" policy toward Beijing, the United States is also legally committed under the Taiwan Relations Act to provide "defense articles and services that enable Taiwan to maintain a sufficient self-defense capability."

Separately, however, Washington agreed on August 28 to a relatively small sale of $90 million worth of anti-ship missiles made by McDonnell Douglas Corp., which could sink potentially invading Chinese warships.

Taiwan wants the weaponry in part so that it can maintain a position of strength as it continues its negotiations with Beijing. President Ma has said that demilitarizing the Taiwan Strait—in which China currently has 1,300 missiles pointed at Taiwan—is the ultimate goal of the talks with the mainland, but that economic and tourism matters should be decided first. “When you are facing a big brother at your back, you have to be prepared,” says Chang of the Mainland Affairs Council. “We cannot rest our security on the hope of goodwill from the other side.”

Ma's policies have been criticized by those who worry that he is being too conciliatory toward Beijing. After winning election by a substantial margin, opinion polls now only give Ma a slight majority of support—51.8 percent—in his easing of Cross Strait economic relations, while 33.7 percent oppose what he's done. "The problem," laments Wu Chih-chung, assistant professor of International Politics at Soochow University in Taipei, "is that we are in a really weak position as regards China."

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