C O N F I D E N T I A L SECTION 01 OF 03 SHANGHAI 000314

SIPDIS

SIPDIS

DEPT FOR D/LEE, EAP, EAP/CM, INR/EAP
STATE PASS USTR FOR STRATFORD, WINTER, MCCARTIN
TREAS FOR OASIA - DOHNER/HAARSAGER/CUSHMAN
USDOC FOR ITA/MAC - DAS KASOFF, MELCER, MCQUEEN
NSC FOR WILDER AND TONG

E.O. 12958: DECL: 5/25/2032
TAGS: PGOV PREL PINR CH TW
SUBJECT: SHANGHAI ACADEMIC HUANG RENWEI ON POLITICS, FOREIGN AND
DOMESTIC

REF: SHANGHAI 308

CLASSIFIED BY: Kenneth Jarrett, Consul General, U.S. Consulate
Shanghai, Department of State.
REASON: 1.4 (b), (d)




1. (C) Summary. On May 25, Consul General met with Shanghai
Academy of Social Sciences Vice President Huang Renwei, one of
Shanghai's leading Americanologists. Huang had a positive
appraisal of Shanghai Party Secretary Xi Jinping thus far; in
another six months, he will have mastered his brief sufficiently
so that a replacement could be named for current Mayor Han
Zheng. Vice Premier Wu Yi and State Councillor Tang Jiaxuan,
who between share responsibility for foreign affairs in the
State Council, would probably be replaced by Minister of
Commerce Bo Xilai and Executive Vice Foreign Minister Dai
Bingguo, but who would be superior and who subordinate was the
key question. Huang was optimistic on cross-straits relations,
regardless of whether Hsieh Chang-ting or Ma Ying-cheou was the
next Taiwan leader. Huang believed that China's interests would
be best served by a long view and a willingness to set aside
final status considerations for a long time to come. Huang was
also suspicious of Russian efforts to draw China into an
anti-U.S. bloc. End Summary.

The New Party Secretary
--------------


2. (C) On May 25, Consul General met with Huang Renwei, Shanghai
Academy of Social Sciences (SASS) Vice President and Senior
Fellow. Huang, who had just returned from a conference in
Berlin, is a leading foreign policy advisor for the municipal
government, and has retained this status (so far) under Xi
Jinping, Shanghai's new party secretary. Huang had provided
some input on international issues for the Party Secretary's
work report (ref a). Although the work report was focused

almost entirely on Shanghai's domestic economic development,
Huang observed that numerous foreign policy developments --
including exchange-rate developments, cross-straits relations
(in the form of likely implementation of the "three links" after
Taiwan's next presidential election) and trade friction with the
United States -- would have a major impact on Shanghai and it
was thus important for the city leadership to follow these
issues. Huang, who has worked closely with many Shanghai
leaders including Wang Daohan and Xu Kuangdi, observed that the
Shanghai leaders who moved on to positions in Beijing had always
shown a lively interest in international issues. Xi did have an
interest in such topics, unlike his now disgraced predecessor
Chen Liangyu, who Huang claimed had cared little about matters
outside of Shanghai.


3. (C) Xi has yet to visit SASS, though he has met with its
President. He is still in the initial stages of becoming
familiar with all facets of Shanghai, which is very complicated.
Through the process of compiling the work report, Xi has now
gained basic knowledge of all issues facing him. Political
issues are also complicated. For example, Xi needed to know the
Party leaders at the district level and even have some
familiarity with all of the 810 delegate to the Shanghai Party
Congress, since they all effectively answer to him. Huang
thought that Mayor Han Zheng would be replaced, but not for at
least six months. To replace both Party Secretary and Mayor so
close in time, and with outsiders unfamiliar with Shanghai's
nuances, would be much too disruptive. It would probably take
Xi another six months to master the situation.

SED and the Succession to Wu Yi
--------------


4. (C) Having only returned from Berlin the previous day, Huang
did not have a considered view of the just-concluded second
session of the Strategic Economic Dialogue. However, he
questioned Wu Yi's capacity to properly manage the intricacies

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of U.S.-China relations. Huang said that Wu Yi was "not like
Yang Jiechi, much more fierce." Wu Yi had succeeded to Qian
Qichen's position as Vice Premier, but she had not assumed all
of Qian's responsibilities, keeping foreign economic relations
and turning over traditional foreign policy and Taiwan affairs
to State Councillor Tang Jiaxuan. In any case, Wu Yi would step
down next year. Huang expected that Minister of Commerce Bo
Xilai would replace her. The outcome he would like to see, in
fact, would be for Executive Vice Foreign Minister Dai Bingguo
to fill the former Qian Qichen Vice Premier-position, and Bo
Xilai could then become a State Councillor with responsibility
for foreign economic relations, under Dai. Dai has a good
relationship with Hu Jintao going back to Hu's vice-presidential
days, when Dai was in charge of the Central Committee's
International Liaison Department (ILD). At the time, Jiang
Zemin kept Hu Jintao out of foreign policy, with the exception
of relations with fraternal parties, the responsibility of the
ILD. If the outcome is the reverse, with Bo becoming a Vice
Premier and Dai reporting to him, it would not be very good.
Bo, according to Huang, does not understand international
relations very well.

Patient Optimism on Taiwan
--------------


5. (C) At the conference in Berlin, Huang had encountered a
Deputy Director of the State Council's Taiwan Affairs Office
(TAO), who was there for an exhibition on Cross-straits
relations sponsored by an anonymous wealthy overseas Chinese.
Huang found the key slogan at the exhibition very interesting:
"One China: Peaceful Development." (Yige Zhongguo: Heping
Fazhan) This was a new formulation, avoiding the use of "one
country two systems," and "peaceful unification," more common
formulations. In the near term, Huang was confident that the
"three links" would be implemented not long after Taiwan's
presidential election, whether Hsieh Chang-ting or Ma Ying-cheou
were the victor. Of course, it was still necessary to guard
against disruptive acts by Chen Shui-bian, Huang said.


6. (C) In general Huang was optimistic about cross-straits
relations. He believed that it was better for China to move
very slowly and gradually in addressing the "Taiwan problem."
Everywhere in the world where there had been a re-unification of
a formerly divided nation, there were serious problems. Vietnam
had unified through war, and it had difficulty integrating the
parts. North and South Yemen's unification had not gone well.
Germany had probably handled reunification best, but it was
still far from perfect. Taiwan has had more than 110 years of
separation from the mainland, five full generations. The people
there did not consider themselves Chinese, nor were they willing
to be ruled by China. On the mainland, however, Taiwan was seen
by some as unfinished business from the Civil War and, as a part
of the "family," it was China's prerogative to do what it
pleased, including reunification through force, when it pleased,
even tomorrow. From Huang's point of view, it would be much
better for China to take a long view and not raise unification
or other final status-type issues until self-perceptions on both
sides of the straits had changed. Huang believed that Hu Jintao
held a similar perspective. Certainly, if China were to use
force to take over Taiwan, it would be a disaster, "like Iraq."
Thus, there would still be a "Taiwan problem" after forced
unification.

2008: Year of Decision
--------------


7. (C) Huang noted that next year would be a year of major
political transition worldwide. Germany and France have already
gone through their leadership transitions, and the U.K. was
about to go through its own. The Taiwan, U.S. and Russian
presidential elections in 2008 would all be important. In
particular, Huang thought that the Russian election would be
crucial. He quipped that, at present, Secretary Rice was
probably Putin's biggest headache. Because of Russia's

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uncertain succession, Russia was probably seeking external
political problems to maintain internal unity. Huang added
that, although Russia seemed to be seeking one, it would
definitely not be in China's interests to join Russia in an
anti-U.S. bloc.
JARRETT