SEF CHAIRMAN HONG ON UN REFERENDUM, CROSS-STRAIT

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 002014 SIPDIS SIPDIS E.O. 12958: DECL: 6/15/2032 TAGS: PGOV TW SUBJECT: SEF CHAIRMAN HONG ON UN REFERENDUM, CROSS-STRAIT RELATIONS, AND DOMESTIC POLITICS Classified By: AIT Acting Director Robert S. Wang, Reason 1.4 (b/d) ¶1. (C) Summary: Straits Exchange Foundation Chairman Hong Chi-chang told the Acting Director on August 30 that Taiwan clearly understands the US position on the UN referendum. Most people on Taiwan, nevertheless, believe the island has the right to be a normal member of the international community, something that even the opposition KMT supports. The Acting Director emphasized that the U.S. remains a strong friend of Taiwan, but views the UN referendum being pushed by President Chen as an "unnecessarily provocative" move. Hong explained that President Chen's number one goal is to keep the DPP in power, calculating that such an issue will garner votes for the DPP. Hong underscored to the Acting Director that U.S. public opposition to the referendum is playing into domestic politics by serving as an "external stimulus" for the DPP to use to mobilize society ahead of the upcoming legislative and presidential elections. Hong, nevertheless, assessed that the UN referendum is likely to fail because of the high bar for referendum passage and the fact that competing UN referenda by the DPP and KMT will split voters along party lines. Hong suggested that despite recent tensions, Taiwan leaders will be "responsible" when dealing with cross-Strait issues. He confirmed recent press reports that Taiwan may be close to an agreement with the PRC on the route of the Olympic torch through Taiwan. Turning to the presidential race, Hong said that the DPP and KMT have fielded two potentially strong teams. The race remains too close to call, despite KMT presidential candidate Ma Ying-jeou's lead in most polls. End Summary. Despite UN Referendum "Troubles"... -------------- ¶2. (C) Straits Exchange Foundation (SEF) Chairman Hong Chi-chang, a heavyweight legislator and former DPP New Tide faction leader, told the Acting Director on August 30 that Taiwan clearly understands the US position on the UN referendum. Both sides have already expressed their views on the issue, but most people on Taiwan nevertheless believe the island has the right to be a normal member of the international community, something that even the opposition Kuomintang (KMT) supports. Hong explained that the dilemma is that democratic development has created a growing "Taiwan consciousness" at the same time that the space for Taiwan's participation in the international community has shrunk as a result of pressure from China. A democratic Taiwan surely conforms to U.S. interests in the region, and he hoped the two sides can work through the issue. ¶3. (C) The Acting Director emphasized to Hong that the U.S. remains a strong friend of Taiwan, but sees the UN referendum being pushed by President Chen as an "unnecessarily provocative" move. The referendum, whether it passes or fails, will have no impact on Taiwan's international status, but risks escalating tensions across the Taiwan strait, added the Acting Director. Hong responded that as an appointee to a semi-government association, he understands and supports his government's position. He suggested that Taiwan could have chosen other less controversial approaches to building support for its meaningful participation in international organizations. However, the choice to proceed on the UN issue has already been made and there is "no going back" for Taiwan. ¶4. (C) Hong said that Taiwan leaders are not naive enough to believe that passing a referendum will change Taiwan's international status. He explained that President Chen's number one goal is to keep the DPP in power and Chen calculates that pushing popular issues such as UN entry and referendum will garner votes for the DPP. Even the KMT has had to respond to this strategy by launching its own UN referendum campaign. Therefore, on the surface the UN issue appears to be an international issue, but the driver is domestic politics. Hong assessed that, moreover, the UN referendum is likely to fail because of the high bar for referendum passage and the fact that competing referenda by the DPP and KMT will split the voters along party lines. TAIPEI 00002014 002 OF 003 Taiwan to Be "Responsible" on Cross-Strait Issues -------------- -------------- ¶5. (C) Hong suggested that despite the tensions created by the UN referendum, Taiwan's leaders will be "responsible" when dealing with cross-Strait issues. Hong hoped the U.S. would continue to play a strong role in the region, helping to stabilize cross-Strait relations. Hong said he has told his friends in China not to be concerned about the UN issue. He has urged them to prepare for finding ways to advance relations next year. He was optimistic that after the elections the two sides can make progress on the economic front, noting that discussions of POLITICAL issues can be put off another 40-50 years. Beijing is primarily focused on driving economic development and China for now is content with the current status quo as long Taiwan does not create disturbances. Taiwan and China lack a direct mechanism for communication, hindering negotiations and exchanges between the two sides. Hong said he took the SEF job with the hope that after the 2008 election the two sides can revive institutions such as the SEF as vehicles of communication. ¶6. (C) Hong confirmed recent press reports that Taiwan may be close to an agreement with the PRC on the route of the Olympic torch through Taiwan. He said that Taiwan has agreed that the torch could go directly from Taiwan to Hong Kong (and then to Macao) as long as there is agreement on the description of the route that would not explicitly include wording that indicates that Taiwan is part of China. He said a carefully drafted text is now being considered by Beijing and he appeared hopeful that this would do the trick. US Opposition Driving Support for DPP? -------------- ¶7. (C) Hong underscored to the Acting Director that U.S. public opposition to the UN referendum is strongly playing into domestic politics. A psychologist by profession, Hong noted that the DPP had in previous presidential elections tapped into a growing Taiwan collective consciousness by pushing identity-related issues to energize supporters and garner votes. The repeated use of such tactics have had diminishing marginal returns and in 2008, barring an external stimulus, will probably have an even weaker effect. Although China had "learned its lesson" about overreacting to Taiwan domestic politics in an election year, Hong said that U.S. opposition to the UN bid is however serving as that outside stimulus. He suggested that once UNGA meets in September the UN question would not be as prominent in the campaign because the DPP cannot run on a one-issue agenda but will begin to introduce other themes. (Note: Corey Chen (Chien-chung),DPP presidential candidate Frank Hsieh campaign strategist, told AIT on August 31 that the UN referendum is only giving Hsieh a marginal boost. He suggested that President Chen's strategy of portraying the U.S. as close to China in suppressing Taiwan is risky and could backfire, reducing support from moderate voters for Hsieh.) Presidential Race Will Go to the Wire -------------- ¶8. (C) Turning to an analysis of the presidential race, Hong said that the DPP and KMT have fielded two potentially strong teams and the race remains too close to call, despite KMT presidential candidate Ma Ying-jeou's lead in most polls. Hong said DPP presidential candidate Frank Hsieh (Chang-ting) and Ma do not differ much on substantive policies. Hsieh's first challenge is unifying his forces with those of his running mate, former Premier Su Tseng-chang, and coordinating with the DPP party SIPDIS headquarters. The party machinery is not operating smoothly and has been a hindrance, rather than a help, to Hsieh. President Chen's policies in the coming months will also be crucial for giving Hsieh added momentum during the campaign. ¶9. (C) Hong asserted that overall the Hsieh-Su ticket has a stronger leadership record than the KMT team of Ma and former Premier Vincent Siew. Ma enjoys a clean image, which his corruption trial has failed to mar, but he is still seen as a TAIPEI 00002014 003 OF 003 weak and indecisive leader. Siew could help Ma's prospects by garnering support from the business community, but Siew is not a strong campaigner, having failed to cultivate and maintain local POLITICAL ties in Chia-yi, his hometown, and central Taiwan. Ma also faces the challenge of maintaining good RELATIONS with LY President Wang Jin-pyng, whose influence may affect how much support the KMT garners in the south. Commenting generally on the KMT, Hong said their greatest weakness is that they have failed to cultivate a younger generation of leaders. The current leadership is "basically the same" as it was in 2000, Hong commented. WANG