TSAI YING-WEN ON STATUS AND PROSPECTS FOR

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 002281

SIPDIS

WASHINGTON PASS AIT/W

E.O. 12958: DECL: 05/24/2015
TAGS: PGOV PREL TW
SUBJECT: TSAI YING-WEN ON STATUS AND PROSPECTS FOR
CROSS-STRAIT RELATIONS

REF: TAIPEI 2213

Classified By: AIT Director Douglas H. Paal, Reason 1.4 b


1. (C) Former Mainland Affairs Council (MAC) Chairwoman Tsai
Ying-wen told the AIT Deputy Director that Taiwan-PRC
relations are once again back where they were before the PRC
Anti-Secession Law derailed earlier progress. President
Chen's harsh criticisms of Pan-Blue opposition leaders over
the past week, however, complicate achieving cross-Strait
consensus in Taiwan. If the efforts at inter-party
reconciliation undertaken by Premier Frank Hsieh in early
2005 can be restarted, Tsai said, and there is a change of
KMT leadership in July, there could be progress on
cross-Strait relations before the December election campaign
starts. End Summary.


2. (C) Following up on her statements at a small cross-Strait
conference in Taipei on May 16 (reported reftel),former MAC
Chairwoman and current Democratic Progressive Party (DPP)
legislator Tsai Ying-wen discussed the cross-Strait situation
and the ruling DPP with the Deputy Director on May 19. Tsai,
who describes herself as a moderate working to "educate" her
DPP colleagues on cross-Strait issues in a more pragmatic,
vice ideological, direction, said she is cautiously
optimistic on the prospects for both party reconciliation and
cross-Strait cooperation.

Early Steps Derailed
--------------


3. (C) Tsai told the Deputy Director that in January,
following the ruling DPP's poor showing in the December
Legislative Yuan (LY) election, Taipei authorities took a
more pragmatic approach to cross-Strait relations and the
call for Lunar New Year charter flights with Mainland China.
The resulting January 13 Lunar New Year charter flight
agreement, she said, was made possible by a "major
concession" by Taiwan -- acquiescence to Beijing's demand
that no Taiwan MAC or Straits Exchange Foundation (SEF)
officials participate in the charter flight negotiations,
which occurred in Macao. (NOTE: Officials from the Taiwan
Ministry of Transportation and Communications were allowed to
participate. END NOTE) During the 2002 negotiations in Hong
Kong under her tenure as Chairperson, Tsai explained, Taiwan
MAC and SEF officials not only participated in, but actually
led, the negotiations for charter flights in 2003.


4. (C) The positive atmosphere generated by the Lunar New
Year charter flights this year, Tsai said, set the stage and
created expectations for further expansion of cross-Strait
exchanges. Passage of the PRC Anti-Secession Law on March
14, however, derailed this process and brought cross-Strait
relations to a standstill. While most people had anticipated
that the fallout from that law would last at least a few
months, Tsai said, the back-to-back Mainland China visits of
KMT Chairman Lien Chan and PFP Chairman James Sung in late
April-early May had changed Taiwan,s political focus. They
had essentially made the ASL &yesterday,s news.8 These
visits, she explained, were a direct political challenge to
Chen's leadership and stimulated internal challenges within
the DPP that Chen had to counter via public attacks on Lien
and Soong. Nonetheless they led to a much quicker return to
discussion of next steps in the cross-Strait relations.

Recovering Momentum
--------------


5. (C) After the May 14 National Assembly election and the
DPP,s marginal victory, Tsai said, Chen moved to reassert
his shaken control of the DPP and beat back fundamentalist
opposition. On May 18, Chen held the first of a series of
meetings with small groups of DPP legislators, urging them to
fall back into line with the party's "reconciliation" policy
on both inter-party cooperation and cross-Strait issues.
Tsai, who noted with some relief that she had been traveling

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and therefore unable to attend this first meeting, stated
that Chen had called on the legislators to "trust the
President" and his leadership. She noted, however, that Chen
is also using PRC blockage of Taiwan cooperation with WHO,
both observership and access to International Health
Regulations (IHR),to criticize the Lien and Soong trips in
order to reinforce his own DPP leadership.


6. (C) Tsai told AIT that the current situation probably
requires a "cooling off period" before the earlier
cross-Strait momentum can be restarted. She noted that the
upcoming change in the KMT Chairmanship could also facilitate
KMT cooperation with the DPP by enabling the two parties to
improve communication and work together again (COMMENT:
presumably because the deeply embittered Lien, who claims he
was twice "cheated" out of presidential elections, will step
down. END COMMENT). She said that she anticipates Taiwan
will be prepared to return to the concession it made earlier
this year to enable the Lunar New Year charter flights. This
would allow arrangements for additional passenger charters to
be negotiated by ostensibly private delegations that include
a government representative. If that arrangement is
successful, it could also be applied to cargo charters, tour
groups from the PRC and Taiwan agricultural exports to China.

Comment: "Window of Opportunity" or "Breathing Space"?
-------------- --------------


7. (C) The U.S. (Cornell Law School) and British-trained
Tsai is an important observer of cross-Strait issues because

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of her four years (2001-2004) as MAC Chairperson. However,
over the past week she has offered diametrically opposed
prescriptions for a way forward on cross-Strait relations.
She told the May 16 cross-Strait conference (reftel) that
there is only a limited window for progress on cross-Strait
relations before both Chen Shui-bian and Hu Jin-tao are
hemmed in by their respective hardliners. With the Deputy
Director, however, she was not optimistic for the short term
and focused on longer term prospects for inter-party dialogue
in Taiwan leading to cross-Strait negotiation and reduction
of tensions. This revised assessment probably reflects the
harder line that President Chen has taken publicly this week
toward the Lien and Soong visits in the wake of Taiwan's WHA
rejection, as well as Tsai's firsthand involvement in the May
18 DPP legislators' meeting with Chen. Her altered
assessment likely mirrors the highly fluid state of Taiwan
politics, of the cross-Strait issue, and even of the Defense
Procurement Special Budget -- all of which are in limbo and
will require the kind of constructive leadership rarely seen
in highly politicized Taipei to move forward.
PAAL