Cablegate: Media Reaction: Cross-Strait Relations, U.S.-Taiwan Fta,

VZCZCXYZ0002
RR RUEHWEB

DE RUEHIN #2615/01 2150927
ZNR UUUUU ZZH
R 030927Z AUG 06
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC 1408
INFO RUEHBJ/AMEMBASSY BEIJING 5507
RUEHHK/AMCONSUL HONG KONG 6715

UNCLAS AIT TAIPEI 002615

SIPDIS

DEPARTMENT FOR INR/R/MR, EAP/TC, EAP/PA, EAP/PD - SCOTT WALKER
DEPARTMENT PASS AIT/WASHINGTON

SIPDIS

E.O. 12958: N/A

TAGS: OPRC KMDR KPAO TW
SUBJECT: MEDIA REACTION: CROSS-STRAIT RELATIONS, U.S.-TAIWAN FTA,
NORTH KOREA

1. Summary: As Taiwan's major Chinese-language dailies continued to
focus their reporting August 3 on President Chen Shui-bian's efforts
to clarify the details of the Presidential Office's special state
affairs expense account and his alleged improper use of taxpayers'
money to pay for domestic help, coverage also focused on Premier Su
Tseng-chang's "revisionist line" and the possibility of a visit by

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China's Taiwan Affairs Office Director Chen Yunlin to Taiwan. Both
the pro-independence "Liberty Times," Taiwan's biggest daily, and
the pro-unification "United Daily News" front-paged the severe
criticism by high-ranking DPP officials against Su's revisionist
line and his decision to ease restrictions on cross-Strait trade.
The "United Daily News" carried a story on page two with the
headline "Taiwan Insists on Negotiations over Chen Yunlin's Visit."
Several papers also reported in inside pages the latest statistical
report by the Control Yuan, which showed that political donations to
the KMT soared 70 percent in 2005, while those to the DPP plunged 51
percent when compared with 2004.

2. In terms of editorials and commentaries, a "Liberty Times"
analysis criticized Premier Su's revisionist line, saying it will
not only squeeze Taiwan's maneuvering space but will also shake the
support of Green stalwarts. A "United Daily News' analysis, on the
other hand, said whether Taiwan allows China's Taiwan Affairs Office
Director Chen Yunlin to visit the island will affect the subtle
relationship between President Chen and Premier Su. An opinion
piece in the limited-circulation, pro-independence, English-language
"Taipei Times" said U.S. Trade Representative Karan Bhatia 's recent
suggestion for Taiwan to get a Free Trade Agreement with the United
States "would be beyond what a free country finds acceptable." An
editorial in the limited-circulation, pro-independence,
English-language "Taiwan News" said Pyongyang's recent missile tests
have spurred Japan to change its national defense stance, which will
have profound implications for Japan's future and the future of the
Asia-Pacific region. End summary.

3. Cross-Strait Relations

A) "Su's Revisionist Line Shaking Support of Green Fundamentalists"

Journalist Su Yong-yao noted in an analysis in the pro-independence
"Liberty Times" [circulation: 600,000] (8/3):

"... Over the past six years, President Chen Shui-bian's has also
been flip-flopping with regard to his line toward cross-Strait
relations. At first, he abandoned the previous 'No Haste, Be
Patient" policy and proposed a modified line of 'Proactive Opening,
Effective Management.' Afterwards when Taiwan's economic and trade
investments continued to soar, the government then changed its
policy to 'Proactive Management,' in the hope of cooling the fever
for the time being.

"But Su's Cabinet has, tactically speaking, made a rash advance
policy again, believing that Taiwan can use its adjustments in
cross-Strait trade and economics in exchange for chances of
political breakthroughs. Yet the unilateral westbound policy [by
Taiwan's side] will not win goodwill from Beijing, but will result
in China's joining hands with the pan-Blue camp to exert more
pressure on the administrative branch. As expected, challenges to
the many opening decisions made at the Taiwan Sustainable Economic
Development Conference are already at the door. The implications of
the Taiwan Sustainable Economic Development Conference not merely
included a squeeze of Taiwan's maneuvering room in terms of its
China policy but also had an impact on the Green stalwarts. ...

"At this moment, as the most powerful Green camp political leader in
the post-Bian era, Premier Su should play the role of a leader who
upholds the Green camp's long-term values. He will repeat Bian's
mistakes if he attaches greater importance to short-term effects."

B) "Weakened Bian Takes a Move? Can Su Tolerate Being a
Figurehead?"

Journalist Sean Liu said in an analysis in the pro-unification
"United Daily News" [circulation: 400,000] (8/3):

"... To Beijing's great surprise, Chen Shui-bian, who used to have
the upper hand in creating tensions between Washington, Beijing, and
Taipei, would be plagued by the storm of scandals within just a few
months. Even his announcement ceding some of his powers was
insufficient for him to secure his presidency; he had to face calls
by the pro-Green scholars demanding his resignation. The Chinese
officials in charge of Taiwan affairs, who originally viewed Chen as
their major target for struggle, suddenly came to realize that the
targets may likely become Su Tseng-chang or Annette Lu. They thus
started to cautiously and closely monitor Taiwan's political
developments. ...

"[China's Taiwan Affairs Office Director] Chen Yunlin expressed his
interest in visiting Taiwan at the end of last year, and there is
nothing new in his reiteration of his interest this time. But how
Chen, who is now in a politically disadvantageous position, will
make a move may still likely affect the Bian-Su relationship, which
is still being fine-tuned. ...

"Su now faces a dilemma. As the highest administrative chief, he
cannot possibly tolerate being turned into a figurehead; in the
meantime, in order to win the 2008 presidential election, he also
hopes to show people his concrete achievements in improving
cross-Strait relations. It will of course be a political asset for
Su if Chen Yunlin can come to Taiwan smoothly during his term of
office. But how to keep a subtle balance so that Bian will not
fight back as a result of his rashness is going to test Su's
wisdom."

4. U.S.-Taiwan FTA

"The Long Road to a US-Taiwan FTA"

Nat Bellocchi, former AIT chairman and now a special advisor to the
Liberty Times Group, opined in the pro-independence,
English-language "Taipei Times" [circulation: 30,000] (8/3):

"When Deputy US Trade Representative Karan Bhatia visited Taipei in
May, the local media called it progress. It was the first visit by
a senior US government official in a long time. Over the 1990s
there had been Cabinet-level visits, but none in the present
administration of US President George W. Bush. That's progress?
...

"Setting aside the internal struggle within Taiwan on matters
dealing with cross-strait issues and Taiwan's liberty, the
suggestion is that Taiwan's industry, more closely tagged to China,
would be better for the US. There may be some US companies that
would like it, but it's doubtful that leaders responsible for
security - in the US, Taiwan or other allies - would agree. The
Taiwanese government has often called for dialogue with China to
discuss the many practical issues that need to be addressed. The US
government publicly encourages this. It is still US policy that a
change in Taiwan's relationship with China, such as that being
suggested, would need the assent of the people of Taiwan.

"Now that Taiwan has developed a sound economic basis to argue for a
FTA, the USTR seems to think that Taiwan should cozy-up to China.
That is close to a policy of no FTA until Taiwan is part of China
(the price the PRC demands is that, ultimately, Taiwan must accept
becoming a part of China). While most observers feel the US had
never been interested in negotiating a FTA with Taiwan, few thought
it would come to this. In the end, the price Taiwan would have to
pay for agreeing to an FTA, as suggested by the USTR, would be
beyond what a free country finds acceptable. A Taiwan that can help
the region maintain its economic and political liberties might
convince US businesses that the price would be too high even for
them."

5. North Korea

"DPRK Missile Tests Spur Japan into Action"

The pro-independence, English-language "Taiwan News" [circulation:
20,000] editorialized (8/3):

"Less than a month after the test-firing of seven tactical missiles
by the North Korean government, the Japanese government has
forcefully advocated revision of Japan's 'peace' constitution and
Tokyo's National Defense Program Guidelines of December 2004 and has
even floated the possibility of 'preemptive attacks' in the annual
'Defense of Japan 2006' position papers released Tuesday by the
Japan Defense Agency. This is a major and grave change in Japan's
national defense stance. ...

"In the past, the JDA has had to strive for a wide range of support
to justify any adjustments in Tokyo's defense policy and has
traditionally had difficulty in securing broad identification among
the people. However, the missile test-firing by the Democratic
People's Republic of Korea regime has helped the Japanese Defense
Agency gain a major new advantage for a major adjustment. ... Moves
by the Japanese government to break through its own self-maintained
restrictions on collective self-defense will undoubtedly be made in
cooperation with the United States and coordinated under the
U.S.-Japan Joint Security Arrangement. Such a trend will reflect
Japan's future direction of expanding the scope of its definition of
'self-defense,' a change that will have profound implications for
both Japan's future and for the future of the Asia-Pacific region."

YOUNG

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