CHEN ADMINISTRATION LOOKS TO PFP TO STEAL KMT

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 001871 SIPDIS STATE PASS AIT/W E.O. 12958: DECL: 02/01/2015 TAGS: PREL PGOV PINR CH TW SUBJECT: CHEN ADMINISTRATION LOOKS TO PFP TO STEAL KMT CROSS-STRAIT THUNDER REF: A. TAIPEI 1827 ¶B. TAIPEI 1437 Classified By: AIT DIRECTOR Douglas Paal, Reason: 1.4 (B.D) ¶1. (C) Summary: Presidential advisors assert that Beijing's April 18 invitation to People First Party (PFP) Chairman James Soong was a vindication of the government's hard-line stance towards the KMT's attempts to open a separate dialogue with the PRC. Presidential Office Deputy Secretary General James Huang told AIT that the government will consider giving "semi-authorization" to Soong so his upcoming Beijing trip can serve as an "ice-breaker" for future cross-Strait developments. Huang said that President Chen Shui-bian's harsh April 16 attack on KMT Chairman Lien Chan was the result of Chen's anger over media reports that the KMT would sign a "cessation of hostilities" agreement with the Chinese Communist Party (CCP). While Presidential aides remain deeply suspicious of Lien's motives, they insists that the government will proceed with plans for cross-Strait openings after the dust settles from the Lien/Soong visits and May 14 National Assembly (NA) elections. AIT has cautioned all parties not to allow heated rhetoric over cross-Strait issues to undermine chances for future cooperation in the Legislative Yuan (LY). End Summary. Derailing the KMT-CCP Accord? -------------- ¶2. (C) Senior Chen administration officials tell AIT they are increasingly confident that they have thwarted PRC attempts to use the KMT to undermine the government's cross-Strait policy. Presidential Office Deputy Secretary General James Huang assessed that the government's strong reaction to the KMT's unilateral attempts to negotiate cross-Strait agreements convinced leaders on the Mainland that their "united front" strategy was becoming counterproductive. Huang and other officials say that Beijing appears to be exploring avenues for talking to the Chen administration, perhaps using Soong as a preliminary bridge. Huang credited President Chen's harsh condemnation of Lien Chan on April 16 for Beijing's April 18 invitation to PFP Chairman James Soong. Huang said the PFP's lack of advance knowledge of the April 18 invitation suggests that Beijing made the decision in haste. ¶3. (C) National Security Council (NSC) Senior Advisor, and close Presidential confidante, Lin Jin-chang told AIT that President Chen remains committed to his policy of reconciliation with the Mainland. Lin echoed Huang's assessment of Beijing's motives, adding that the President is increasingly confident that the PRC has stepped back from its aggressive attempt in the aftermath of the Anti-Secession Law to undermine the government via the KMT. Lin said that the government will wait until the media circus surrounding the Lien/Soong visits and May 14 NA election tapers off before resuming the government's cross-Strait liberalization initiatives. While condemning recent PRC and KMT actions in highly emotional terms, Mainland Affairs Council (MAC) Chairman Joseph Wu confirmed to the Director on April 18 that the government will restart liberalization initiatives, likely in June. When pressed whether the government may endorse any of the items included in the KMT-CCP "Ten Points," Presidential Office SecGen Huang replied that Taipei has a list of initiatives much longer than that, and is willing to engage on a range of issues as long as Beijing agrees to talk to the Chen administration. Soong: Loyal Opposition -------------- ¶4. (C) The NSC's Lin told AIT that the President hopes James Soong's visit will set a positive atmosphere for future cross-Strait interactions. Lin noted that the KMT played such a role in the lead up to the historical Lunar New Year charter flights earlier this year by creating a positive atmosphere and then letting the government talk details. Presidential Office Deputy SecGen Huang said that the President would consider giving Soong "semi-authorization" for his upcoming talks in Beijing. However, NSC Senior Advisor for cross-Strait policy Chen Chung-hsin told AIT he has counseled against another meeting between Chen and Soong for fear that at this stage in the relationship Beijing would not welcome Soong if he were seen as an "envoy" from Chen. PFP Policy Chief Vincent Chang (Hsien-yao) expressed similar concerns. Chang told AIT that the PFP will keep in close "under-the-table" contact with the Presidential Office, but will likely avoid any public contacts between Soong and the President before the Beijing trip. He added, however, that Soong will definitely raise Chen and Soong's February 24 "10 Points" during his Beijing meetings. Chang said that Soong will characterize the Chen-Soong agreements as the "basic consensus" cross-Strait policy within Taiwan society. Chang and the Presidential SecGen Huang have consulted at least twice in private since the PRC's public invitation to Soong. Lien: Disloyal Opposition -------------- ¶5. (C) Presidential aides continue to characterize KMT Chairman Lien Chan's efforts in scathing terms, ruling out the possibility that Lien's visit could add any positive momentum to the cross-Strait relationship given the KMT Chairman's perceived hatred for the Chen government. The Presidential Office's Huang told AIT that Chen's harsh denunciation of Lien during his April 16 Rotary Speech stemmed from anger over reports in the local media that morning suggesting that Lien would sign a "cessation of hostilities" agreement with Hu Jintao during his upcoming visit. Huang said the President "felt it was his responsibility as the Head of State" to lay down a marker against what he perceived as an usurpation of governmental authority. Presidential aides say they believe that prospects for Lien to contact Chen before Lien's departure appear to be fading and blame Lien's personal anger over the March 20, 2004 election results for his obstinance. They show no sense that Chen's intemperate rhetoric may be part of the problem. Cooling Tempers -------------- ¶6. (C) AIT has urged both parties to maintain restraint in public in order to create conditions for the Legislative Yuan (LY) to resume deliberations over the Special Defense Procurement Budget and other major bills. The NSC's Lin assured AIT that the government's "bottom line" is to avoid repeating the gridlock of the past four years. However, Lin and other senior Presidential aides acknowledge that Chen Shui-bian continues to perceive Lien and the KMT as complicit in Beijing's campaign to undermine his authority and Taiwan solidarity in the wake of the Anti-Secession Law. Presidential Office Deputy SecGen Huang said the President believes that Taiwan can only effectively engage with Beijing if there is a domestic consensus over Taiwan's interests. He added that, in Chen's view, the KMT's unilateral overtures will cause lasting harm to Taiwan's fundamental interests. Chen administration officials continue to dismiss the possibility that the KMT will cooperate on the Special Defense Procurement Budget and say that their strategy will continue to focus on cooperation with the PFP. Comment: Perceptions and Reality -------------- ¶7. (C) We are skeptical that Beijing has decided to retreat from its "united front" campaign and deal with the government in Taipei as a result of Chen's hard-line rhetoric. However, this perception appears to be easing fears of isolation with the Chen administration that existed in the immediate aftermath of the P.K. Chiang visit to Beijing. This changed assessment, and Beijing's April 18 invitation to James Soong, appears to be giving the Chen government more confidence to reopen planning for resumed cross-Strait economic liberalization. While MAC and other agencies continue to tout the "effective management" theme in the current period, we do not hear for the moment the kinds of warnings over a long-term freeze in cross-Strait interactions that surfaced as a result of a perceived PRC "united front" offensive in late March/early April (Ref B). ¶8. (C) The thornier problem is domestic. Many in the Chen administration are convinced that it is impossible to deal with Lien Chan on any issue, and they suggest that the government may simply have to wait out Lien's term before seeking dialogue with a presumably more rational successor. The fact that Chen publicly reacted on April 16 to what turned out to erroneous media reports based on unnamed KMT sources suggests that the President personally assumes the darkest motives behind recent KMT actions. Similarly, the KMT claims to be basing its actions on the belief that the Chen administration is intent on blocking all cross-Strait economic openings. This lack of communication and mutual understanding continues to pose the greatest hurdle to making progress on all major policies, domestic and with the PRC. AIT will continue to press the government and KMT to exercise restraint and seek communication channels to separate facts from rumors. PAAL