Identifier
Created
Classification
Origin
07TAIPEI2340
2007-10-16 09:11:00
CONFIDENTIAL
American Institute Taiwan, Taipei
Cable title:  

SEF CHAIRMAN HONG ON HU SPEECH, CROSS-STRAIT

Tags:  PGOV TW 
pdf how-to read a cable
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C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 002340 

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/16/2032
TAGS: PGOV TW
SUBJECT: SEF CHAIRMAN HONG ON HU SPEECH, CROSS-STRAIT
RELATIONS, AND DOMESTIC POLITICS

REF: TAIPEI 02014

Classified By: AIT Acting Director Robert S. Wang, Reason 1.4 (b/d)

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 002340

SIPDIS

SIPDIS

E.O. 12958: DECL: 10/16/2032
TAGS: PGOV TW
SUBJECT: SEF CHAIRMAN HONG ON HU SPEECH, CROSS-STRAIT
RELATIONS, AND DOMESTIC POLITICS

REF: TAIPEI 02014

Classified By: AIT Acting Director Robert S. Wang, Reason 1.4 (b/d)


1. (C) Summary: SEF Chairman Hong told the Acting Director
on October 16 that Chinese President Hu Jintao showed
"moderation" and "restraint" in his remarks on Taiwan at the
Party Congress given recent tensions across the Strait. Hong
emphasized that the "peace agreement" overture was a positive
step indicating that Beijing could show some flexibility in
future (post-May 2008) interactions with Taipei. Hu's
comments, however, were unlikely to lead to a breakthrough in
the discussions on opening Taiwan further to mainland
tourists and regularizing cross-Strait charter and cargo
flights. Hong asserted, moreover, that Beijing does not want
to give President Chen the opportunity to "take any credit"
for improving cross-Strait relations. Turning to domestic
politics, Hong said President Chen's return to the DPP
Chairmanship bodes well for Frank Hsieh's presidential
prospects as Chen will dampen deep Green rhetoric and help
mend party divisions. End Summary.

Positive on Hu Jintao Speech...
--------------


2. (C) Straits Exchange Foundation (SEF) Chairman Hong
Chi-chang, a heavyweight legislator and former DPP New Tide
faction leader, told Acting Director Wang on October 16 that
Chinese President Hu Jintao showed "moderation" and
"restraint" in his remarks on Taiwan at the Party Congress
given recent tensions across the Strait. Hong emphasized
that the "peace agreement" overture was a positive step
indicating that Beijing could show some flexibility in future
interactions with Taipei. The key to reaching any long-term
accommodation between the two sides remains the question of
Taiwan's international status. Reaching any agreement on
such an issue will be a long and drawn-out process and the
two sides must begin by reaching a consensus on establishing
a mechanism for discussing the issue. He noted, however,
that no party here accepts the model of "one country, two
systems." Despite Hu's moderate tone, Hong said that Taipei
can't react too positively to the message in order to
preserve its current bargaining position with Beijing.


3. (C) Hong explained that within the DPP there are two

competing interpretations of Hu's recent comments and his
decision not to criticize the UN referendum drive in the
speech. Some view the absence of any references to the UN
referendum as a green light to press the initiative to build
momentum and set the political agenda going into the
legislative and presidential elections. Others, including
Hong, see Hu's moderation as evidence that the UN referendum
initiative has helped push the envelope and created greater
space for Taiwan. Perhaps now, with Taipei holding a
referendum bargaining chip, Beijing will be more willing to
engage Taiwan in discussions and reach a compromise down the
road, Hong suggested.

But Pessimistic on Near-term Cross-Strait Relations
-------------- --------------


4. (C) Hong told the Acting Director that Hu's comments
were unlikely to lead to a near-term breakthrough in the
discussions on opening Taiwan further to mainland tourists
and regularizing cross-Strait charter and cargo flights.
Taipei and Beijing, through their discussions held in Macau,
had largely ironed out the technical and implementation
aspects of those issues. There are "no differences" between
Taipei and Beijing on the substance, Hong emphasized. The
real sticking point, Hong asserted, is that Beijing did not
want to give President Chen the opportunity to "take any
credit" for improving cross-Strait relations, especially
after his recent statements, including the "four wants and
one without" speech early this year. Hence, a final
agreement is unlikely during the remainder of Chen's term.


5. (C) Hong said that Beijing had deliberately halted
progress by raising last-minute conditions that ensured
failure of the discussions on the Olympic torch route. The

TAIPEI 00002340 002 OF 002


Taiwan side showed flexibility, did not insist that the torch
pass from and to a third country, and accepted Beijing's
designation of Taipei as one of the 22 "overseas cities" even
though Hong Kong and Macau received the same designation.
Beijing, however, made the last-minute demand that the ROC
flag could not be displayed along the torch route knowing
full well that Taipei would be unable to accept such a
condition. On this score, Beijing not Taipei was responsible
for the break in negotiations, Hong insisted.

Presidential Race Still Too-Close to Call...
--------------


6. (C) Turning to domestic politics, Hong told the Acting
Director that the presidential race between Frank Hsieh and
Ma Ying-jeou remains too close to call. Three upcoming
commemorations--October 24 (UN Day),February 28, and March
14 (passage of the anti-secession law)--will give the DPP an
opportunity to emphasize Taiwan identity-related themes ahead
of the election. Hsieh has gotten off to a slow start and
still faces the challenge of putting together a more seasoned
campaign staff, while Ma and the KMT could be derailed by
intra-party squabbling. Hong said President Chen's return to
the DPP Chairmanship bodes well for Frank Hsieh's
presidential prospects as Chen will dampen deep Green
rhetoric and help mend party divisions. Chen will dilute the
strength of the deep Greens within the party organization,
moving the election agenda in a more moderate direction and
smoothing over differences between party factions.

But Winner Likely to Reach out to Beijing
--------------


7. (C) Hong expects that either Hsieh or Ma, if elected,
would put priority on moderating Taiwan's cross-Strait agenda
and focus on improving relations with Beijing. Even Ma,
however, would be constrained from moving toward unification
in the near future because Taiwan's current political climate
at most allows for maintenance of the "status quo." Beijing
will need to respond by giving Taiwan some international
space, which would go a long way toward easing anxieties
about China's motives. Hong asserted that even the KMT can't
accept Beijing's "one country, two systems" framework as a
future model for Taiwan-China relations and so Beijing will
ultimately need to show more flexibility and be willing to
compromise. Hong said that the momentum for Taiwan
independence is directly correlated with China's suppression
of Taiwan's international space and status rather than the
actions taken by any individual leader on Taiwan.


8. (C) Hong argued that President Chen does not have a
"deep Green" agenda and is a practical politician who has
responded to particular circumstances and conditions both in
Taiwan and across the Strait. President Chen's only agenda
is to win the upcoming election and keep the DPP in power.
For example, Hong said Chen sought to reach out to Beijing in
2005 by working with PFP Chairman James Soong on a consensus
plan ahead of Soong's visit to Beijing. Passage of the
anti-secession law that spring, however, was a clear sign of
Beijing's insincerity and forced Chen to back away from such
plans. Hong emphasized that in the future Beijing will have
to meet any overtures by Taiwan's next president half-way if
the two sides are to begin substantive discussions to pave
the way for long-lasting peace across the Strait.
WANG