SHANGHAI SCHOLARS ON CROSS-STRAIT RELATIONS: MA'S

C O N F I D E N T I A L SECTION 01 OF 03 SHANGHAI 000397

SIPDIS

STATE FOR EAP/CM
NSC FOR LOI

E.O. 12958: DECL: 9/17/2033
TAGS: CH MARR MCAP PA PGOV PREL TW
SUBJECT: SHANGHAI SCHOLARS ON CROSS-STRAIT RELATIONS: MA'S
LEADERSHIP, INTERNATIONAL SPACE, PRC'S DILEMMA

REF: SHANGHAI 127

CLASSIFIED BY: Simon Schuchat, Deputy Principal Officer, U.S.
Consulate General, Shanghai, Department of State.
REASON: 1.4 (b),(d)




1. (C) Summary: Shanghai academics are divided in their opinion
of Ma's political skills, some claiming his distinct style of
leadership creates complications for the PRC, which is
frequently not consulted in advance of Ma's initiatives. The
international space issue will take many years to resolve, as
the PRC is internally divided and not convinced that
pro-independence forces in Taiwan will not regain power in
future elections. The PRC will block discussion of the issue at
the upcoming United Nations General Assembly. Ma's "diplomatic
truce" initiative is putting the PRC in a difficult position, as
it wants to show goodwill to Taiwan but cannot "reject"
countries that want to switch diplomatic relations to the PRC.
The PRC is likely to accept Ma's proposal of August 24 to build
more links between Kinmen (Taiwan) and Xiamen (PRC). The ARATS
Chair will visit Taiwan and meet with his SEF counterpart in
October or November, but the two sides may not be on the same
page regarding the purpose of the visit. The academics
expressed concerns about U.S. weapon sales to Taiwan and
wondered whether the United States feels threatened by closer
cross-Strait ties. End summary.


2. (SBU) In a series of separate meetings in early-mid
September, Poloff discussed cross-Strait relations with Shen
Dingli, Director of the Center for American Studies at Fudan
University; Yan Anlin, Director of the Department of
Cross-Strait Relations, Shanghai Institute for International
Studies (SIIS); Xin Qiang, Deputy Director of the Center for
American Studies at Fudan University; and Shao Yuqun, Deputy
Director of the Department of South Asia Studies, SIIS. Shen is
often quoted in local press for his expertise on a wide range of
international security issues. Xin's research focuses on
U.S.-China relations, including relations in the context of
cross-Strait affairs. Shao was in the Department of
Cross-Strait Relations at SIIS until recently and still follows
the issue closely, attending international conferences on the
subject.

Divided Over Ma
--------------

3. (C) The academics agree that Ma has made vast strides in
improving cross-Strait relations with his "flexible diplomacy",
in sharp contrast with his predecessor Chen Shui-bian. However,
they are divided in their opinion of Ma's skills as a political
leader. Shen thinks Ma has shown himself to be "smart" with
some of his initiatives, such as proposing a "diplomatic truce"
with the PRC. Although Yan says Ma has so far "met his
expectations" (see reftel) and remains optimistic about Ma's
future performance, he does not think Ma is as strong as
previous Taiwan presidents. He is still the "most influential"
person in the KMT, but is more of a "political rock star" than
an actual political leader.


4. (C) Although Xin recognizes the domestic pressure on Ma to
achieve results in the international arena, he does not think Ma
is "clever enough" to understand the Mainland's dilemma on some
issues, such as international space and "diplomatic truce."
Shao likewise criticized Ma's "habit" of announcing
international initiatives without prior consultations with the
Mainland, causing PRC leaders to scramble to come up with a
response. She thinks he is "not a traditional Chinese leader",
his views and mentality shaped by his experience in the United
States. His decision to reach across party lines and appoint
Lai Hsin-yuan head of the Mainland Affairs Council was an
example of his unconventional way of thinking. Although he
means well, he is naive and does not connect well with the
general public since he would rather "tell the hard truth"
(e.g., on Taiwan's economic condition) rather than "paint a
beautiful picture", as other more experienced politicians would
do.

No Space (Yet) for Taiwan

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5. (C) The academics believe Ma personally "does not really
care" about the issue of international space but has to show his
domestic audience that he is doing something to raise Taiwan's
international standing. They are pessimistic about Taiwan's bid
for international space, predicting there will be no
breakthrough or significant discussion of the issue at the
upcoming United Nations (UN) General Assembly since the PRC will
"naturally" block such discussion. Foremost among PRC concerns
is the stability of Taiwan's leadership. The PRC is not
convinced that pro-independence forces in Taiwan have been
significantly weakened. If the PRC gives too much now and
pro-independence leaders come to power in the next presidential
or legislative elections, what recourse will the PRC have?


6. (C) Furthermore, there are internal divisions within the PRC
Government on how to deal with this issue. Although Chinese
President Hu Jintao may personally be in favor of compromise,
there are many hardline senior leaders who remain unconvinced
that compromise will eventually lead to unification. According
to Yan and Xin, the PRC Ministry of Foreign Affairs (MFA) and
Taiwan Affairs Office (TAO) are also divided. The TAO is in
favor of compromise, which they view as a "win-win" scenario,
whereas the MFA sees things in "zero-sum" terms, still engrossed
in its historical antipathy towards Taiwan.


7. (C) Shen argued that there is also a fundamental problem in
allowing Taiwan to join UN specialized agencies, since this
needs to be done under the One China principle, which would
require a declaration of "which China". The "Chinese Taipei"
nomenclature may have been possible for the Olympics, but it
cannot be used for international organizations like the UN that
require statehood.


8. (C) The academics believe the issue should be set aside for
now. The focus should instead be on building greater mutual
trust through closer economic and cultural ties. The two sides
may sit down and revisit the issue again if relations continue
to improve and Ma is reelected four years from now.

Dilemma Over "Diplomatic Truce"
--------------

9. (C) Like the issue of international space, the PRC
Government is split between moderates and hardliners regarding
Ma's "diplomatic truce" initiative, according to the academics.
Xin thinks hardliners in the Chinese MFA are loath to accept
this truce out of self-interest, since it is considered a "great
achievement" to convince countries to switch recognition. Shen
thinks it was a "smart move" by Ma since Taiwan, which is
"outresourced" by the PRC, does not have many options. (Note:
International media reported on September 12 that the PRC used
USD $300 million in foreign exchange reserves to entice Costa
Rica to switch its recognition to the PRC last year. End note).
By taking the initiative, Ma was able to place the ball in the
PRC's court to show goodwill towards the peace process.


10. (C) Xin and Yan argue that it is "understandable" for
countries like Paraguay to want to switch recognition to the PRC
since the PRC has more to offer right now. However, Beijing has
been "self-restrained" in its reaction to Paraguay's overtures
out of consideration for Taiwan. Illustrating Beijing's
dilemma, Xin asked rhetorically, "If a country wants to switch
recognition to the PRC, can we say no and turn them away?" He
thinks Beijing will take incremental steps to build closer
relations with countries like Paraguay, starting with greater
economic cooperation.

Building Bridges
--------------

11. (C) The academics believe Beijing will respond positively
to Ma's announcement on August 24 to build a bridge between
Kinmen and Xiamen. Shen thinks the Mainland has been
deliberately slow in responding to this proposal out of
consideration for Ma's domestic position: if the PRC responds
too quickly, it will lend ammunition to pro-independence forces
in Taiwan and hurt Ma's political standing. Instead, the PRC
needs to take its time and devise a "sophisticated response."
Yan, however, argued that the delay is not necessarily out of

SHANGHAI 00000397 003 OF 003


consideration for Ma's domestic situation since Taiwan's
opposition party would oppose Ma in any case. Rather, it is
merely emblematic of the PRC's careful decision-making process,
which is by nature slow unless the situation warrants an urgent
response.

Questions About U.S. Intentions
--------------

12. (C) Some of the academics questioned the rationale for U.S.
arms sales to Taiwan, Shen stating "it does not make sense"
since cross-Strait relations have improved so much. Both Yan
and Xin openly questioned whether the United States really wants
to see Taiwan and the PRC develop closer relations. Xin
cautioned against possible negative consequences for U.S.-China
relations but added that weapons sales to Taiwan are "not a new
thing" (i.e., the United States has been selling arms to Taiwan
for years now),so the PRC will "accept it" in the end though it
will continue to publicly oppose the move.

ARATS-SEF Talks
--------------

13. (C) ARATS Chairman Chen Yun Lin's visit to Taiwan in
October or November would be a positive step, said Yan, since
this would be the first such visit since 1999. Chen will meet
with his SEF counterpart P.K. Chiang, and they may sign several
agreements though the contents of the agreements are not yet
clear. Yan thinks both sides may have "different
interpretations" of the purpose of the visit, with the Taiwan
side misconstruing it as an occasion to forge a broader peace
agreement.

Tsai's Recent Visit to the U.S.
--------------

14. (C) Shao mentioned that when Taiwan's Democratic
Progressive Party Chair Tsai Ying-wen recently visited the
United States and spoke at a seminar at the Center for Strategic
and International Studies (CSIS),one of Shao's colleagues
currently doing research at CSIS was not allowed to attend, the
first time this has happened. Shao speculates this was because
her colleague is from the Mainland, and CSIS wanted to avoid any
potentially embarrassing situation during Tsai's visit, keeping
the occasion low profile. Tsai reportedly commented that the
United States is "too optimistic" about the future direction of
cross-Strait relations.

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

15. (C) Although Shanghai academics see cross-Strait relations
generally moving in the right direction after Ma took office,
and they acknowledge the benefits of some of Ma's overtures to
the Mainland, they see him mostly as a step up from his
predecessor Chen Shui-bian rather than someone capable of
navigating some of the more difficult issues at hand, such as
international space.
CAMP