MAY 13 TAO PRESS BRIEFING: ARMS SALES, MA'S ONE YEAR MARK,

UNCLAS BEIJING 001285


E.O. 12958: N/A
TAGS: PREL PARM ECON ETRD CH TW
SUBJECT: MAY 13 TAO PRESS BRIEFING: ARMS SALES, MA'S ONE YEAR MARK,
KMT-CCP PLATFORM, POLITICAL TALKS, REPRESENTATIVE OFFICES

Summary
--------------


1. Key points from the May 13 Taiwan Affairs Office (TAO) press
briefing:

-- Regarding potential U.S. arms sales to Taiwan, the TAO spokesman
said China's "consistent" and "clear-cut" policy is that it opposes
U.S. arms sales to Taiwan.

-- Assessing Taiwan President Ma Ying-jeou's first year in office,
the spokesman hailed the efforts of the two sides to "seize the rare
opportunity," make a "historical turning point" and achieve a
"breakthrough" in cross-Strait relations.

-- The spokesman confirmed that KMT Chairman Wu Poh-hsiung accepted
an invitation to visit the Mainland and meet with CCP General
Secretary Hu Jintao in June. He reiterated the importance of the
KMT-CCP "platform" but refused to speculate on what the impact on
this channel would be if Ma Ying-jeou were to assume the KMT
chairmanship.

-- On Ma's comment that he would focus on economic issues for his
first term, the spokesman said that while economics should come
first, sensitive political and military issues, if not eventually
dealt with, could become a bottleneck in the development of
cross-Strait relations.

-- Asked about Ma's stated desire for the mutual establishment of
representative offices, the spokesman said that China has a positive
attitude on the issue and is ready to engage in consultations at an
appropriate time.

ARMS SALES TO TAIWAN
--------------


2. At the May 13 Taiwan Affairs Office (TAO) press briefing,
spokesman Yang Yi was asked whether U.S. arms sales to Taiwan would
be an obstacle to the establishment confidence building measures
between the Taiwan and Mainland militaries. Yang responded that the
"great progress" in cross-Strait relations has not come easy and
should be cherished. The two sides should do things to promote the
peaceful development of cross-Strait relations. China has been
consistently and resolutely opposed to U.S. sales of weapons to
Taiwan. He noted that China's position on this issue was
"consistent" and "extremely clear-cut".

MA'S FIRST YEAR IN OFFICE
--------------


3. The TAO spokesman, asked to comment on the Ma's first year in
office, hailed the efforts of both sides to "seize the rare
opportunity," make a "historical turning point" and achieve a
"breakthrough" in cross-Strait relations. He said that both sides
oppose "Taiwan independence" and accept the "92 consensus." Mutual
political trust has unceasingly strengthened over the past year.
Yang expressed hope that the two sides would continue to uphold the
spirit of "building mutual trust, setting aside disputes, seeking
common ground while reserving differences, and jointly creating
win-win circumstances" to promote further peaceful development
across the Taiwan Strait.

KMT-CCP PLATFORM
--------------


4. Yang confirmed that KMT Chairman Wu Poh-hsiung has accepted an
invitation to visit the Mainland and meet with CCP General Secretary
Hu Jintao in June. He reiterated the importance of the KMT-CCP
"platform" (guo gong pingtai, i.e. party-to-party exchanges) saying
that it has played a "positive role" in developing cross-Strait
relations over the past several years and said the channel will
continue to be useful. Asked what would happen to the KMT-CCP
platform if Ma Ying-jeou assumed the KMT chairmanship, the spokesman
said that he did not want to answer a hypothetical question.

FIRST ECONOMICS, THEN POLITICS
--------------


5. In response to a question on Ma's comment that he would focus on
economic issues for his first term, the spokesman acknowledged the
primacy of economic issues, but said that the two sides should not
miss the opportunity to engage in cultural and economic exchanges as
well. As for the contradictions and disputes between the two sides,
the spokesman said that if the sensitive political and military
issues were not eventually dealt with, they could become a
bottleneck in the development of cross-Strait relations.

REPRESENTATIVE OFFICES
--------------


6. Asked about Ma's stated desire for the mutual establishment of
representative offices, the spokesman said that the two sides have
already agreed to the mutual establishment of offices for shipping
companies, airlines, travel agents and financial institutions. As
for setting up representative offices for the Association for
Relations Across the Taiwan Strait (ARATS) in Taiwan and the Straits
Exchange Foundation (SEF) in the Mainland, Yang said that China has
a positive attitude on the issue and is ready to engage in
consultations at an appropriate time.

OTHER ISSUES
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7. Other issues addressed by the TAO spokesperson:

-- Economic Cooperation Framework Agreement (ECFA): China has and
"open and positive" attitude about negotiating an ECFA with Taiwan.
He expressed hope that the two sides will each quickly complete
their basic research and preparations so that formal consultations
can begin. Yang said that China would continue to consider Taiwan's
requests, protect their interests and show good will. He noted that
China is eagerly awaiting the formal publication of Taiwan's
investment guidelines for Mainland enterprises.

-- H1N1: China promptly notified Taiwan about its first confirmed
case of H1N1 and that the two sides are closely coordinating and
sharing information to control the outbreak.

-- New West Strait Economic Development Zone: Yang Yi spoke at
length about the State Council's recent statements in support of a
"West Strait Economic Zone." He explained the plan was meant to
promote the development of economic relations between Fujian
Province and Taiwan, taking advantage of the geographic proximity
and cultural affinity of the two areas.

-- Strait Forum: The TAO spokesman announced that Politburo Standing
Committee Member Jia Qinglin would attend the May 15-22 Strait Forum
in Fujian, which would include over 8000 participants, including
local officials from 25 counties and cities in Taiwan. The
spokesman implied that no local DPP officials had accepted
invitations to attend the forum.

-- More Flights?: Asked about Ma's desire for 540 weekly
cross-Strait flights, the spokesman said that the current air
corridors were already at capacity despite the recent increase from
104 to 270 weekly flights. The Mainland hopes to open new air
corridors to meet market demand.