Identifier
Created
Classification
Origin
05TAIPEI3141
2005-07-25 23:22:00
CONFIDENTIAL
American Institute Taiwan, Taipei
Cable title:  

DOD CHINA MILITARY REPORT DEMARCHE TO TAIWAN NSC

Tags:  PGOV PREL TW 
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This record is a partial extract of the original cable. The full text of the original cable is not available.

252322Z Jul 05
C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 003141 

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WASHINGTON PASS AIT/W

E.O. 12958: DECL: 07/25/2015
TAGS: PGOV PREL TW
SUBJECT: DOD CHINA MILITARY REPORT DEMARCHE TO TAIWAN NSC
AND MND

REF: A. TAIPEI 133146


B. TAIPEI 3097

C. TAIPEI 3030

Classified By: AIT Deputy Director David J. Keegan, Reason 1.4 b

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 003141

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WASHINGTON PASS AIT/W

E.O. 12958: DECL: 07/25/2015
TAGS: PGOV PREL TW
SUBJECT: DOD CHINA MILITARY REPORT DEMARCHE TO TAIWAN NSC
AND MND

REF: A. TAIPEI 133146


B. TAIPEI 3097

C. TAIPEI 3030

Classified By: AIT Deputy Director David J. Keegan, Reason 1.4 b


1. (C) AIT presented the DOD China Military Report demarche
to National Security Council (NSC) Secretary General Chiou
I-Jen and Vice Minister of National Defense (VMND) Michael
Tsai (Ming-hsien). Both expressed appreciation for and

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concurrence with the report, and both said they are working
to increase Taiwan's regular defense budget to around three
percent by 2008. Taiwan's impending National Security Report
will reinforce the DOD report, and any mention of
counterstrike measures will be clearly for purposes of
delaying a PRC attack on Taiwan and not aimed at the mainland
civilian population. Action Request: Chiou asked for Taiwan
access to see information from the classified annex of the
2005 DOD China Military Report. End Summary.

DOD China Military Report Demarche
--------------


2. (C) The Deputy Director met with NSC Director Chiou I-Jen
and VMND Michael Tsai on July 21 and 22 to present the 2005
DOD China Military Report demarche as instructed (Ref A).
Both men expressed appreciation for the DOD report and
emphasized that Taiwan fully concurs with its findings.
Chiou noted that Taiwan's view of PRC military development
closely tallies with the DOD Report. Chiou, who was
accompanied by NSC Deputy SecGen Henry Ko (Cheng-heng),told
the Deputy Director that he hopes the DOD report will help
Taiwan authorities educate Taiwan political leaders on the
realities of the security situation Taiwan faces and the
importance of enhancing the regular defense budget and
passing the long-stalled Defense Procurement Special Budget.


3. (C) VMD Tsai expressed appreciation for the briefing and
for the report itself. He noted that he had arranged for a
one-day rush translation of the report into Chinese, with the
permission and support of ASD Peter Rodman. Tsai told the
Deputy Director he had already read the Preface and the last
two chapters, and found this year's report more comprehensive
than last year's. For example, this year the alternate
attack scenarios on Taiwan were both reduced from seven to

five and appeared more realistic. Tsai said he had gained a
more comprehensive understanding of PRC military build-up in
the near term, including its capabilities against Taiwan and
other nations in the region, including Japan, Australia, and
Southeast Asian nations.


4. (C) Tsai pointed to the more indirect threat from the
PRC's three-pronged "soft power" strategy against Taiwan --
legal, psychological and opinion warfare. Legally, the
Anti-Secession Law was designed to give China legal authority
to deploy "non-peaceful measures" against Taiwan.
Psychologically, Beijing has embarked on united front tactics
(tongzhan) to entice opposition political leaders, business
people, and farmers. Taiwan has a responsibility, Tsai said,
to defend itself and to maintain peace. Noting that 80
percent of the PRC's oil passes through the Taiwan Strait,
Tsai said peace in the Strait is also important to China.

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Maintaining a regional security dialogue with Japan, the U.S.
and other neighbors in the region, Tsai told the Deputy
Director, is a top priority for Taiwan.

Increasing the Defense Budget
--------------


5. (C) Chiou told the Deputy Director that the Taiwan
government hopes to increase the regular defense budget over
the next three years to reach three percent of GDP by 2008.
VMND Tsai reported that President Chen has indicated he
supports consideration of a gradual increase in the regular
defense budget to three percent; now the real challenge
facing MND is to convince Premier Frank Hsieh and the
Executive Yuan (EY). Increasing the defense budget, however,
will necessitate cuts elsewhere and arouse protests from
other government agencies. For this reason, Tsai noted, MND
had turned to the Special Budget mechanism to finance the
three-part package now stuck in legislative limbo. This
week, Tsai will propose to the EY that the Special Budget
components that do not pass the LY be funded out of the
regular budget. In response to the Deputy Director's
statement of U.S. concern over other defense procurement
issues, notably ammunition, Tsai stated MND is currently
assessing these needs and will discuss with the U.S.


6. (C) Chiou opined that there is still a possibility the
long-stalled Defense Procurement Special Budget will be
approved by a Legislative Yuan (LY) Special Session this
summer. Speaker Wang Jin-pyng, he said, "wants to help" and
is working on a mechanism for getting the Special Budget
through the Special Session. (Note: Chiou's information
proved overly optimistic; at almost the same moment Chiou was
insisting on Wang's willingness and the likelihood for
passage, Wang himself was telling the Director there was no
way the Special Budget would pass in the Special Session; see
Ref B). Noting that PFP legislator Lin Yu-fang had announced
July 21 that he was changing his position and will now
support discussing the Defense Procurement Special Budget in
the regular LY session beginning September, the Deputy
Director asked if this shift by a long-time critic of the
Special Budget would make a difference. Tsai responded that
the Special Budget is still up in the air and while Wang may
be amenable, Lin's PFP and its Chair, James Soong, continue
to oppose the Special Budget.

Taiwan's National Security Report
--------------


7. (C) The Deputy Director asked both Chiou and Tsai about
the status of Taiwan's National Security Report (NSR) due out
later this summer (see Ref C). Chiou explained that the
report is still in the drafting-revision stage, with NSC, MND
and National Security Bureau (NSB) working to integrate the
various proposed changes into a draft that will be submitted
to President Chen Shui-bian. The President will then hold a
formal National Security Meeting, the first of his five years
as President, Chiou explained. The draft NSR view of the
pace of PLA development, Chiou noted, is similar to that of
the DOD report. When the Deputy Director urged that AIT be
allowed to review the document before completion, Chiou
assured that AIT will have access.


8. (C) The Deputy Director asked whether the NSR will
include counterattack measures (fanzhi, see Ref C). Chiou
responded affirmatively, explaining that deterrence to Taiwan
means providing time. Additional time, Deputy SecGen Ko
interjected, will make the PRC hesitant to use force because
it will increase the possibility of outside intervention.
Ko, however, assured that Taiwan will not deploy
counterattack measures until it has consulted with the U.S.
VMND Tsai separately explained that Taiwan is focusing on
countermeasures to prolong an attack on Taiwan.
Countermeasures, Chiou stressed, will not be used to attack
PRC population centers, but rather military bases, missile
sites, and radar installations. Nor will Taiwan fire the
first shot, but when hit it will respond in self defense to
slow down the pace of attack.


9. (C) The Deputy Director raised the issue of resource
efficiency, noting that development of new weapons systems is
a very expensive proposition and that the development and
production of domestically produced counterattack systems
currently envisioned would divert money from direct defense.
Tsai responded that sometimes deterrence is cheaper and more

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efficient than defensive weapons. Counterattack, he argued,
is both more efficient and adds more to defensive capability,
whereas defensive weapons are more expensive to maintain than
offensive weapons.

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


10. (C) The publication of the DOD report has been
enthusiastically welcomed by the Taiwan authorities, who have
immediately insisted that it confirms their own claims of a
China threat. This emphasis on a China threat has been used
both to justify delaying improvement in cross-Strait economic
linkages and to criticize the Pan-Blue opposition as being
pro-China and, therefore, anti-Taiwan. AIT will continue
closely monitoring the NSR as it moves forward in the
drafting stage, and pressing for access. Providing Taiwan
officials with access to information from the classified
annex of the 2005 DOD China Military Report would increase
our leverage in pressing for access to the NSR draft.

11. (C) Action Request. Please provide response to Taiwan
request for information from the classified annex to the DOD
report.
PAAL