MEDIA REACTION: U.S.-TAIWAN RELATIONS

UNCLAS AIT TAIPEI 001754

SIPDIS

DEPARTMENT FOR INR/R/MR, EAP/TC, EAP/PA, EAP/PD - ERIC BARBORIAK
DEPARTMENT PASS AIT/WASHINGTON

SIPDIS

E.O. 12958: N/A


TAGS: OPRC KMDR KPAO TW
SUBJECT: MEDIA REACTION: U.S.-TAIWAN RELATIONS



1. Summary: As the insider trading scandal allegedly involving
President Chen Shui-bian's son-in-law continued in Taiwan's media
spotlight May 23, newspaper coverage also focused on Taiwan's
failure to obtain observer status at the World Health Assembly and
on the year-end Kaohsiung mayoral race. The pro-status quo "China
Times" ran an exclusive front-page story with the headline: "Lu:
Will Resign As Vice President If Corrupt Practices Cannot Be
Eliminated within Three Months." The pro-independence "Taiwan
Daily," on the other hand, ran a banner headline on page three that
said "U.S. Assistant Secretary of State for East Asian and Pacific
Affairs Urges China to Engage in Direct Dialogue with President
Chen." The same newspaper also ran a story inside with the
headline: "Taiwan-U.S. TIFA [Talks] to Kick off Day after
Tomorrow."


2. In terms of editorials and commentaries, an opinion piece in the
mass-circulation "Apple Daily" said Chen's move to specify a policy
in Taiwan's first National Security Report to increase the island's
national defense budget can be viewed as a plan that kills two birds
with one stone. On the one hand, according to the article, Chen's
move is akin to making a written commitment to the United States,
which will evidently help improve Chen's interactions with
Washington. On the other hand, the article added, it will help
pressure the opposition parties to pass the defense budget proposed
by the Chen administration - a move that will help augment Chen's
performance with regard to national security. A separate opinion
piece in the "Apple Daily" asked the United States why it left out
Taiwan when it has signed Free Trade Agreements (FTA) with major
anti-terrorist countries in the world. End summary.

A) "Bian and U.S. Each Has Something to Gain from [Taiwan's]
National Security Report"

Professor Chang Tzu-yang, head of Nanhua University's Department of
International and Mainland Affairs, opined in the mass-circulation
"Apple Daily" [circulation: 500,000] (5/23):

"The National Security Report has come out, and many people in
Taiwan think there is nothing new in the report. But such a view
might overlook some of the details that are closely related to
future political developments: First, the U.S. reaction came
extraordinarily quick. AIT Taipei Director Stephen Young's comments
appeared in the newspapers before the report came out. Young
assessed the report as 'constructive,' and he urged China to learn
from Taiwan's 'transparency of information.' Even though Young did
not indicate which part of the report is constructive, his speech at
the Taipei American Chamber of Commerce on May 12 seemed to reveal
some hints. In his speech, Young urged both the ruling and
opposition parties in Taiwan to work together to increase the
national defense budget. ...

"The move to specify the policy to increase [Taiwan's] national
defense budget in the 'binding' National Security Report is,
externally speaking, akin to Chen Shui-bian handing a written
commitment to the United States - a move that will help improve his
interactions with the United States so as to complement his mediocre
performance on the diplomatic front. In the domestic aspect, Chen
can use the report to intangibly include the opposition parties
under the U.S. pressure, so they will consider passing the defense
budget allocated by the Chen administration and not wait until after
2008 - a move that will help augment Chen's performance with regard
to national security. It can thus be viewed as a plan that kills
two birds with one stone. ...

"The United States is highly skilled in controlling how its
relations with Taiwan can be improved. Deputy U.S. Trade
Representative Karan Bhatia is scheduled to visit Taiwan May 25; he
will ask Taiwan to strengthen its enforcement of the Intellectual
Property Rights Law, loosen its financial regulations, and support
the U.S. position concerning the Doha Round. The friendly
atmosphere that has just been restored between Taiwan and the United
States will be conducive to Bhatia's promotion of the U.S. trade
agenda. Judged from this perspective, Washington has its reasons in
acting in line with [Taiwan]. ..."

B) "The United States Should Sign a Free Trade Agreement with Taiwan
as Early as Possible"

Chao Wen-heng, associate research fellow of the Taiwan Institute of
Economic Research, opined in the mass-circulation "Apple Daily"
[circulation: 500,000] (5/23):

"Taiwan has been working with the United States to strengthen
international intelligence cooperation, prevent money laundering,
and provide various kinds of humanitarian assistance. In addition,
Taiwan either participated in or supported the United States'
campaign for the global war on terrorism, such as signing the
Container Security Initiative and the Proliferation Security
Initiative. On the international frontlines of the war on
terrorism, Taiwan plays an important role with regard to money
laundering prevention and intelligence cooperation. Former AIT
Taipei Director Douglas Paal even praised Taiwan for its
contributions to international anti-terrorist activities. [We]
believe the U.S. government is clearly aware of this situation. But
what we cannot understand is why Washington has left out Taiwan when
it has signed Free Trade Agreements (FTA) with all the major
anti-terrorist countries. ...

"... If the United States does not sign an FTA with Taiwan, no other
country will do so (other countries will follow suit after Taiwan
signs an FTA with the United States). Under such a circumstance,
Taiwan's trade position in the international community is doomed to
marginalization. If major trade and economic countries in the world
sign FTAs with each other while Taiwan is excluded, the trade
barriers formed by these FTAs will make it difficult for Taiwan's
products to be exported to other countries, and [the result] will
thus be another form of economic isolation. ..."

YOUNG