CROSS-STRAIT CHARTER FLIGHTS: ONE STEP FORWARD

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 000130

SIPDIS

STATE PASS AIT/W

E.O. 12958: DECL: 01/13/2015
TAGS: PGOV PREL CH TW
SUBJECT: CROSS-STRAIT CHARTER FLIGHTS: ONE STEP FORWARD


Classified By: AIT Director Douglas H. Paal. Reason: 1.4 (B/D)


1. (C) Summary. According to Taiwan's Mainland Affairs
Council (MAC),Beijing this afternoon, January 13, accepted
Taiwan's proposed delegation to participate in negotiations
on direct cross-Strait charter flights around the Chinese New
Year. At this still early point in the negotiation process,
both sides have actually made small concessions -- Beijing by
apparently accepting the presence of Taiwan government
aviation officials in the Taiwan delegation, and Taiwan by
pulling back from its adamant insistence that Taiwanese
officials responsible for cross-Strait relations be included
in the Taiwan delegation. In the face of growing Taiwan
public hopes for a charter flight deal in time for the
Chinese New Year, and of opposition Kuomintang (KMT)
demonstration that its delegation to Beijing successfully
worked out arrangements for charter flights, the DPP
government had been forced to accept Beijing and the KMT's
agenda, and received a small concession from the PRC in
return. End Summary.

Taiwan Twice Responds
--------------


2. (C) Taiwan twice responded to the PRC Taiwan Affairs
Office (TAO) call for what Taiwan calls the "second round" of
negotiations, the "first round" being a meeting in Macao last
Friday, January 7, that MAC Chairman Joseph Wu insisted to
AIT had been "very successful" in setting the framework for
further negotiations. Chen Chung-hsin, Counselor responsible
for cross-strait relations at the National Security Council
(NSC),told AIT on January 11, that the government had
authorized Taipei Airline Association (TAA) Director Michael
Lo (Lo Ta-hsin) to transmit a proposed Taiwan five-person
delegation list to Beijing consisting of: TAA Director
Michael Lo, another airline industry representative, the
Chief of the Civil Aeronautics Administration (CAA, under the
Communication and Transportation Ministry),and one official
each from the Mainland Affairs Council (MAC) and the Straits
Exchange Foundation (SEF). Explaining that he is a
"pragmatist" who just wants to get charter flights moving,
Chen said he had cautioned his "colleagues" that the MAC and
SEF officials would be automatically rejected by TAO. That,
he noted, is exactly what happened, as the TAO spokesman
announced in a press conference in Beijing yesterday, January

12.


3. (C) That same afternoon, Chen said, the Taiwan government
worked out a new delegation list consisting of Michael Lo,
CAA Director Chang Kuo-cheng, one CAA staffer, and Mr. Lo's
Chief Secretary, which NSC Secretary-General Chiou I-jen
approved and which Michael Lo transmitted to his PRC CAA
counterpart in Beijing. Chen felt reasonably confident that
this second list would be acceptable to Beijing, because, he
said, the TAO spokesman in Beijing had replied to a
reporter,s query on whether all Taiwan government officials
would be unacceptable to Beijing by clarifying that he had
only mentioned MAC and SEF.


4. (C) This afternoon, January 13, Joseph Wu called AIT to
say that Taiwan had just received a positive response from
Beijing, accepting Taiwan's revised delegation proposal.
Shortly afterward, NSC Counselor Chen called to convey the
same messagae, clearly delighted by the outcome and proud of
his part in it. The Taiwan side, Wu told AIT, had made one
last ditch effort to get a MAC economist included in the
delegation, but Beijing had refused. Wu stated the two sides
are working out the details of meeting time and place, which
he hopes will take place this weekend. Final details will be
announced at a government-wide -- MAC, NSC, MND, and Ministry
of Transport and Communications -- press conference tomorrow
afternoon, January 14, at 5:00 p.m.

Way Forward
--------------


5. (C) In his meeting with AIT, Chen appeared more flexible
on the issue of Taiwan government participation in charter
flight negotiations than MAC Chair Joseph Wu. In public and
to AIT in private, Wu has continued to insist that Taiwan
will only negotiate with China on charter flights according
to the "Hong Kong model" (the 2002 air service agreement
between Hong Kong and Taiwan by delegations nominally headed
by airline industry officials, but with all substantive
negotiations done by government officials from both sides).
Chen, however, supported revision of the proposed Taiwan
delegation list, explaining to AIT that the "Hong Kong model"
could be used for subsequent expanded cross-strait air
service negotiations. President Chen, he told AIT, had
approved of this graduated negotiation process, the third
stage of which would be negotiation on the "three links"
(commodity, transport, and post). At the present stage, he
explained, charter flights are the "critical key" on which
future progress depends. First, he said, we must reduce
cross-Strait tensions.


6. (C) Chen told AIT that the DPP government was having to
tread very carefully on the cross-Strait issue, as many of
its supporters were hostile to any concessions on
negotiations with China. "Liberty Times," he noted,
represented that contingent and functioned as a major
restraint on the Government,s freedom of action. Chen,
however, was just as dismissive of the KMT delegation to
Beijing as Joseph Wu and other DPP leaders. The KMT trip,
Chen charged bitterly, constituted Chinese government
intervention to help the KMT, which allowed itself to be used
by China. He was particularly incensed at the claims by the
KMT that the charter flight issue had been resolved by the
KMT delegation to Beijing (see septel report on KMT Chairman
Lien Chan,s meeting with the Director).


Comment
--------------


7. (C) The charter flight issue is playing out against the
backdrop of Taiwan,s bitter post-elections politics in the
run up to the formation of the new government (i.e.,
Executive Yuan). The KMT delegation visit to Beijing and
subsequent KMT claims that it successfully negotiated a
charter flight deal forced the Taipei government to move and
necessitated the Taiwan government's small but significant
back step on delegation composition. Beijing saved Taipei
some face by agreeing to two non-mainland related officials
in the Taiwan delegation. This is better news than AIT is
used to.
PAAL