KMT MAINLAND AFFAIRS DIRECTOR ON PRC REACTION TO

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 001782

SIPDIS

SIPDIS

E.O. 12958: DECL: 08/08/2032
TAGS: PINR PGOV TW
SUBJECT: KMT MAINLAND AFFAIRS DIRECTOR ON PRC REACTION TO
DPP UN REFERENDUM

Classified By: AIT Deputy Director Robert S. Wang, Reason(s): 1.4 (B/D)
.


1. (C) Summary: In a recent meeting with AIT, KMT Mainland
Affairs Director Chang Jung-kung asserted that Beijing
considers the DPP UN referendum to be a possible violation of
its Anti-Secession Law, and is weighing the idea of economic
sanctions against Taiwan if the referendum "goes too far."
According to Chang, PRC Taiwan Affairs Office (TAO) Director
Chen Yunlin and other TAO officials told him in late July
that President Hu Jintao is under pressure from hardliners,
which he has resisted so far, to respond to the DPP UN
referendum before the Chinese Communist Party National Party
Congress convenes in October. The KMT leadership is divided
on how to proceed with their version of a UN referendum --
some would withdraw it if the DPP withdraws its proposal,
while others would press on to assure the public of the KMT's
sincerity in protecting Taiwan's international interests. In
other comments, Chang discussed the background of KMT
Honorary Chairman Lien Chan's poor relations with
presidential candidate Ma Ying-jeou. End Summary.

KMT Talks Cross-Strait with TAO Chen Yunlin
--------------


2. (C) KMT Central Committee Mainland Affairs Policy Director
Chang Jung-kung visited Beijing in late July, as part of a
KMT delegation seeking better protections for Taiwan
businesses operating in the Mainland. Chang told AIT on
August 3 that he and KMT Vice Chairman Chiang Pin-Kung met
several times with CPC Central Committee Taiwan Affairs
Office (TAO) Director Chen Yunlin, and others from the TAO,
to discuss cross-Strait developments.

DPP UN Referendum Violates Anti-Secession Law?
-------------- -


3. (C) According to Chang, officials close to Chen Yunlin
told him that Beijing views the DPP referendum on UN
membership for "Taiwan" as a possible violation of the PRC
Anti-Secession Law (ASL) passed in March 2005. President
Hu's government has not stated this position publicly for
fear of strengthening the hand of hardliners critical of Hu's
more flexible stance toward Taiwan. Nonetheless, Chang
asserted, the Beijing leadership is considering some form of
economic sanctions, perhaps even a blockade, if the
referendum should "go too far."


4. (C) In response to a question, Chang maintained that
Beijing would not wait until after March 2008, the date for a
possible referendum, to decide how to react. The CCP will
convene its 17th National Party Congress in October, Chang
explained, and President Hu is under pressure to issue some
kind of formal response to the DPP UN referendum before then.
Chang maintained that the coming weeks would be a "crucial
period" for cross-Strait relations. Chang also opined that
this "crisis" was more dangerous than the 1999 row over
then-President Lee Teng-hui's "two-state theory" because,
unlike President Lee, President Chen does not have well
established, credible back-channels to calm Beijing's fears.
However, Chang continued, KMT Honorary Chairman Lien Chan's
upcoming trip to Xinjiang and Chen Yunlin's proposed trip to
the U.S. in September may provide opportunities to reduce
concerns. (Comment: It is likely, however, that Chen
Yunlin's trip to the U.S. will be designed to raise, rather
than reduce, concerns. End Comment.)

One UN Referendum at a Time, Please
--------------


5. (C) Chang said that Beijing had been preoccupied with the
DPP referendum and therefore had not "had time" to consider
or react to the KMT's version of a UN referendum. The KMT
had taken pains to explain to China that because of upcoming
elections, the KMT had to propose a referendum on UN
membership to deflect DPP criticism that the KMT put its
relationship with China before Taiwan's relations with the
international community, Chang added.

KMT Split on How to Proceed with UN Referendum
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6. (C) There are differences within the KMT on how to proceed
with the UN referendum, Chang continued. Some in the KMT,
including Lien Chan, believe the KMT cannot win at the DPP's
referendum game, and would like to see both parties withdraw
their respective UN proposals. Others, including KMT
Chairman Wu Po-hsiung and Vice Chairman John Kuan (Kuan
Chung) believe the KMT should pursue its UN referendum even
if the DPP withdraws its proposal; otherwise, the public will
perceive the KMT UN referendum as "insincere." Moreover,
Chang said, the KMT strategy has been to pair its UN
referendum with a referendum to expand cross-Strait air
links. The first demonstrates the KMT's "love for Taiwan,"
Chang explained, while the second is part of the KMT's
"China-centric" strategy for economic growth. Chang said he
and (unnamed) others are concerned that the DPP-controlled
Central Election Commission may find a way to derail the
KMT's UN referendum. Without the cover of its UN referendum,
the air links proposal could make the KMT look too
"pro-China" to Taiwan's moderate swing voters.

Unless It's Bad, Voters Don't Think About Cross-Strait
-------------- --------------


7. (C) According to Chang, unless cross-Strait relations are
in crisis, voters give very little weight to the issue at the
polls. However, he added, when cross-Strait tensions reach a
dangerous point, KMT polling suggests that voters tend to
view the KMT as more capable of managing relations and
restoring calm.

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


8. (C) In the past, Chang has given us useful insights into
KMT views of Beijing's thinking on various topics. But his
remarks about China's reaction to the DPP UN referendum
should be taken with a grain of salt. By putting alarming
words about "economic sanctions," even a "blockade" into
Beijing's mouth, the KMT could be trying to goad the U.S.
into increasing pressure on President Chen to withdraw the
DPP UN referendum so that the KMT would have the excuse it
needs to pull back its own referendum.

Bio Note: Lien Chan Relations with Ma Ying-jeou
-------------- --


9. (C) Commenting on the chilly relationship between Lien and
KMT presidential candidate Ma Ying-jeou, Chang attributed
Lien's dislike of Ma to four past events: (1) in 1996, while
Lien was Premier, Ma publicly criticized the KMT
administration for doing too little to apprehend the
kidnapper of the child of a prominent celebrity; (2)
immediately after the March 19, 2004 shooting of President
Chen and Vice President Lu, Ma privately urged presidential
candidate Lien to cease all campaign activities; (3) the next
day, Ma urged Lien concede defeat to Chen, instead of
contesting the election result; and (4) on March 27, 2004, Ma
as Taipei Mayor vowed to arrest anyone attending a KMT rally
demanding the election result be nullified. According to
Chang, these incidents persuaded Lien that Ma puts his own
political interests before those of the party. (Comment: As
a member of Lien's inner circle, Chang's often critical
appraisals of Ma Ying-jeou's personal and political styles
probably reflect Lien's views. End Comment.)
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