President defends nation's right to hold referendums

UNIVERSAL VALUE: Chen Shui-bian says the US and China have no reason to worry about referendums in Taiwan since they will not be dealing with sovereignty

By Rick Chu and Lin Chieh-yu

STAFF REPORTERS

President Chen Shui-bian yesterday reiterated the government's determination to hold referendums, saying the issue is an internal matter in which the US could not and would not interfere.

Since the planned referendums have nothing to do with sovereignty, Chen said, China also has no right to oppose them.

"The US government's position is clear. They understand that referendums are a universal value and a basic right of people. They have, therefore, never opposed the idea of referendums in Taiwan, recognizing that this is a matter for Taiwan's people [to decide]," Chen said at a tea gathering with local media chiefs last night.

"Actually, the US government is only responding to the Chinese government's concern that referendums have implications for sovereignty," Chen said. "But, of the whole series of democratic reforms that Taiwan has undergone in the past, which of them has China supported?"

"The lifting of martial law, press freedom, legislative reform, direct presidential elections -- they opposed each from beginning to end. But these things are now realities," he said, adding that Taiwan will not halt reforms and progress just because of opposition from China.

Chen said that China was concerned about the impact of referendums on sovereignty, despite his having made clear that they would only be used for civil affairs.

"They [referendums] have nothing to do with sovereignty and the other side of the Strait has no reason to oppose them," he said.

"If Taiwan wishes to hold referendums to protect its sovereignty, China has no grounds to oppose its doing so, especially since referendums are not a matter relating to the sovereignty issue," he said.

Chen was reacting to questions from the media about the attitudes of the US and China toward referendums in Taiwan.

His remarks came during a discussion with more than 50 media executives on the second day of his cross-country tour.

The president said the referendum issue in the past has been associated with Taiwan independence and war mongering, but that people now see things differently. According to Chen, people now recognize that referendums are a universal value and a basic right that cannot be denied by any person, political party or state.

Chen has said that before the presidential election next March, the Cabinet will hold referendums on the fate of the partially completed Fourth Nuclear Power Plant and Taiwan's participation in the World Health Organization (WHO).

As for whether the nation's entry to the WHO was an issue that had a bearing on sovereignty, Chen said, "Medical treatment has no borders. There is no reason why Taiwan should not enter the WHO.

"This problem stems from the over-politicization of the other side," he said.

"If Taiwan could enter the WHO without hindrance, then it wouldn't need to hold a referendum to address this question. But the problem is that Taiwan has fought to gain WHO entry for seven years and has constantly come up against China's obstruction represented by the view that Taiwan's entry to the WHO would amount to a challenge to Beijing's `one China' principle," he said.

That the country should enter the WHO is perfectly right and proper and reflects the will of the nation's 23 million people, Chen said.

China investment fever too high, official warns

THE GUARDIAN , LONDON

A senior Chinese minister warned Wednesday that the world's fastest growing economy is in danger of overheating as expansion outstrips power supplies, threatens production quality and raises the risk of oversupply.

In the first six months of the year, China sprinted forward at a blistering pace of 8.2 percent, but then concerns about the risks were tempered by the SARS epidemic, which was seen as a coolant for such high octane growth. With the SARS outbreak under control, officials have started to speak about the rise in economic temperature, pushed up by the growth of small, low quality and poorly regulated steel, cement and car firms.

"If it is not cooled, the investment fever in some industries will heavily affect China's robust economic growth," said National Development and Reform Commission Minister Ma Kai in a China Daily interview.

China's belated but passionate embrace of capitalism has produced enviable statistics, and because of its cheap labor it has become the workshop of the world. China was shocked by the scenes last week at French retail group Carrefour's new store in Hangzhou, where sales assistants had to hold back shoppers.

In the first half of the year, investment in the steel industry more than doubled. In June, car production surged 82 percent year on year, bank loans rose by 26 percent and fixed capital expenditure by 31 percent.

But the authorities are concerned that much of the new money is being thrown at inefficient firms and redundant capacity. This is worryingly reminiscent of the "Great Leap Forward," when even remote villages established steel mills, raising national production, although quality was often poor.

Ma pointed out that many new steel and car firms use old equipment that worsens pollution and wastes energy. The power industry is stretched to the limit, as blackouts this summer have proved.

Financial authorities have also warned of a real estate bubble as investment in new housing out-strips demand. One result of this has been deflation, now at about 0.2 percent. Investment in excess buildings and factories is being fuelled by a sharp growth in the money supply, with cash in circulation 20 percent up in June.

Last year, lending for property rose by more than 50 percent. The government has frozen land leases and warned local authorities to be cautious in infrastructure projects.

Cross-strait ties key to election win

On Wednesday, President Chen Shui-bian indicated he will launch a three-phase project, under which direct links could be implemented by the end of next year. To fully grasp Chen's comments, one must first realize the role that timing plays to the talk - both in terms of when the talk was made and when the direct links are scheduled to begin.

Only a day earlier Chen had indicated during a DPP Central Standing Committee meeting that "one country on each side [of the Taiwan Strait]" and "national referendums" are the central spirits of the party. Of course, who can forget there is the presidential election coming up next March. While no one doubts that Chen's comments on Wednesday are important components of his campaign platform, some people are confused about how "one country on each side" and "direct links before the end of next year" -- two seemingly conflicting concepts -- can accommodate each other?

Co-convener of the KMT-PFP alliance's publicity panel Su Chi, a former Mainland Affairs Council chairman, reflected this view when he said that Chen's talk was an either or option between the two concepts. This view is correct, so long as Beijing insists that Taipei must first accept its "one China" principle before negotiations on direct links can be held.

So, the question then becomes what could possibly change China's mind between now and the end of next year? The answer is the re-election of Chen. In view of Beijing's stubborn insistence on the issue, that is of course only a possibility and not a sure thing. But, that possibility won't even exist with the election of the pan-blue candidates -- KMT Chairman Lien Chan and PFP Chairman James Soong -- who continue to embrace Beijing's "one China" principle.

With "one country on each side" as the main theme of his campaign platform, Chen's re-election would send a strong message to Beijing about what the people of Taiwan really think about the "one China" principle. This is what some people, including Chen, believe could change Beijing's mind, or at least stop it from making acceptance of its "one China" principle a precondition for negotiations.

Interestingly, although the pan-blue camp continues to criticize Chen's cross-strait policies, it has decided to focus its campaign platform on domestic issues. This is due to the fact that domestic issues are the Chen administration's biggest vulnerability and the pan-blue camp's realization that it is treading on a very thin line in terms of public appeals by adopting such a meek and self-demeaning stance in the cross-strait relationship. While people prefer positive and constructive cross-strait relationships, they also cannot help but find political parties that roll over to each and every command and wish of Beijing repulsive.

The pan-blues will find out pretty soon that their plan to shy away from discussion about the cross-strait relationship and sovereignty issues in the presidential campaign simply won't work. This is not only because the DPP won't let it, but also because these issues are on the top of the people's priority list. To achieve a mutually beneficial and stable relationship with China and at the same time not compromise Taiwan's sovereignty is a tough job. At the very least Chen has accomplished the latter. As for the former, cooperation from Beijing will be required.

Make national security a priority

By Chen Shih-min

Most of the Pentagon's latest Annual Report on the Military Power of the People's Republic of China to Congress, published on July 30, remains the same as last year's report. In addition to pointing out in its estimate of China's strength that Beijing has increased the number of missiles aimed at Taiwan to 450, the main difference is that it stresses that Taiwan's "will to resist" is crucial to the question of whether a Chinese attack will be successful.

The report points out that, for China's coercive strategy towards Taiwan to be successful, "perhaps the most important factor is the degree to which Taiwan's leaders and populace perceive themselves to be different and separate from the mainland. Will they perceive that there is something real and significant to be protected by resisting the PRC?"

In last year's report, the US believed that "perhaps the most important factor is the nature of the demands that Beijing imposes. If Beijing's demands [for granting Taiwan autonomy] are limited, then the threshold at which Taiwan would be willing to [give up its resistance and] negotiate may be lower." This year, how-ever, that factor was listed third, after the second factor, "Taiwan's assessment whether the US will assist in deterring and defeating PRC coercion."

The US clearly believes that current differences in domestic opinion in Taiwan severely affects its national security and that China is using this factor to divide the country.

As it did last year, the US states that China may already have gradually abandoned its past search for a method to militarily invade and occupy Taiwan in favor of a coercive strategy which stresses that Taipei should be forced to capitulate during the early days [of an invasion], before the US has come to the aid of Taiwan, so that China would never have to engage in ground warfare in Taiwan. In other words, the use of a wide-ranging, total solution consisting of military, political and economic means to create a comprehensive coercive force in order to send Taiwan the signal that resistance is futile and that des-truction or capitulation are the only two choices.

Beijing's main target is Tai-wan's leadership and its military and their will to resist. It aims to use the most economical method to achieve the greatest political benefit. The report also believes that China's assessment of Tai-wan's will to resist is crucial to the decision of whether or not Beijing will initiate an attack.

There are two aspects to this strategy. China may, without prior notice, take advantage of an initial surprise attack, deceiving and frightening the people of Taiwan, thus forcing the country to quickly give up any resistance. Methods would include missile and air attacks, information warfare and a sea blockade. Special forces, such as an amphibious-striking force or paratroopers, would rapidly occupy or destroy key facilities, causing the the nation's military to lose its will to resist.

"The PLA also could adopt a decapitation strategy, seeking to neutralize Taiwan's political and military leadership on the assumption that their successors would adopt policies more favorable to Beijing," the report said.

During the war in Iraq earlier this year, the US' scare tactics and decapitation strategy caused a rapid collapse in the will to resist of former president Saddam Hussein's government and therefore its defeat. This may have increased China's confidence in the use of such coercive strategies.

In the past, it was believed that China did not have the ability to land on, and occupy Taiwan, and that it therefore did not yet constitute a real threat to the country. The possibility, however, that China now will adopt such a coercive strategy, together with its improved strength, is leading the US to believe that this "may reflect an increasing willingness to consider the use of force to achieve unification."

The report also clearly shows that the US is concerned whether it will have time to dispatch conventional armed forces, centered around an aircraft carrier, to assist in Taiwan's defense in case of a Chinese attack. Perhaps the message to a Taiwanese legislative delegation visiting the US [earlier this year] that the country would have to defend itself for two weeks before US assistance could arrive reflects Washington's worries.

The other key aim of Beijing's strategy is delaying US involvement and how to use asymmetric strategies to counter the technological advantage of US forces in order to stop Washington from intervening before Taipei capitulates, in the end causing the US to accept a Taiwanese capitulation as a fait accompli.

Be it modern destroyers equipped with Sunburn missiles or Kilo-class submarines, China's arms purchases from Russia in recent years have clearly been meant to threaten US aircraft carriers. The gradual completion of China's second-generation nuclear arms over the next 10 years may also neutralize US security promises to Taipei.

Of course, the report also clearly reveals American hopes of influencing the debate regarding the nature of China's threat to Taiwan. After all, Taipei is the second-largest purchaser of US arms. The report once again points out longstanding worries about Taiwan's security. As politicians from every party in this country often point out, national security issues should not be partisan. Each party should make efforts to build a consensus regarding the protection of national security. They should also unite to ensure the establishment of a people's defense in response to China's highly political coercive strategy in order to prevent Tai-wan from being forced to compromise and negotiate under the threat to use military force.

Chen Shih-min is assistant professor in the department of political science at National Taiwan University.