Lee knew of Zanadau proposal

COURT HEARING: The former president said he was aware of plans of invest KMT money in Zanadau Development when he was president, but accepted the plan on trust

By Jimmy Chuang

STAFF REPORTER

Thursday, Nov 13, 2003,Page 1

Former president Lee Teng-hui told judges yesterday that former China Development Holding Corp chairman Liu Tai-ying informed him of the proposal to invest Chinese Nationalist Party (KMT) money in Zanadau Development Corp but he could not remember the details.

"Honestly, I can't really remember that there was a `Zanadau case' among the proposals I approved," Lee said. "I trusted his professional suggestions that could make money for the KMT. However, I did not read every single proposal by Liu very carefully."

Lee said his only concern in approving Liu's proposals was that they stood to benefit the KMT.

Lee told judges that Liu is a good investor and made a lot of money for the party.

The former president made the remarks during a court hearing hosted by Taipei Judge Lin Chuan-cheng. Lee's appearance marked the first time a former president has testified in a legal case.

The hearing was one of several on the Zanadau case and focussed on clarifying whether Liu had made any investments without authorization. It was also looking into whether Lee was aware of all the deals processed by Liu while Lee was KMT chairman and Liu was chairman of the party's Investment and Business Management Committee in 1995.

During the hearing, Liu said he would not make important decisions without Lee's approval.

"Any investment that was worth more than NT$200 million would not be processed without Lee's approval," Liu said.

"Investing in Zanadau stocks was a NT$300 million deal."

Zanadau's majority shareholder, Su Hui-chen, who first made public the scandal last year, was also summoned for yesterday's hearing.

Su told reporters she believed Lee had little to do with the case.

"I don't think that Lee knew much about the case because Liu was the man who had the access to KMT money," Su said.

Su said it was the first time she had met Lee face to face, but that it was not the first time she had seen him in person.

Judges and prosecutors focused on questioning Liu in the morning. They began questioning Lee at 1pm.

To protect the former president, the Taipei District Court allowed only 38 reporters and 60 members of the public to attend the proceedings.

In addition, the Taipei City Police Department and the National Police Administration's First Peace Preservation Corps sent 248 officers to the scene to maintain public order.

Hundreds of Lee supporters were in a standoff with a pro-China crowd outside the court yesterday. The incident led to minor arguments but no major injuries were reported and no one was arrested.

HK independent candidates want democratic reform

SPEAKING OUT: Campaigning in Hong Kong's local elections has turned into an exercise in grass-roots democracy which is likely to make Beijing nervous

REUTERS , HONG KONG

Thursday, Nov 13, 2003,Page 5

Indignant at police raids on Hong Kong's gay bars, activist Kenneth Cheung has decided to take on the law by running for public office.

"I want to reflect the views of minority groups who don't speak for themselves," explained Cheung, one of a new breed of independent candidates in local elections whose political zeal was awakened by "people power" protests against the Beijing-backed government this year.

Hong Kong's District Council elections are usually drab affairs, reflecting the mundane work of bodies that deal with issues like rubbish collection and park management.

But in these politically heady times, campaigning has turned into an exercise in grass-roots democracy that is likely to make Chinese leaders in Beijing nervous.

"There has been an explosion of civil society since July 1," said Sonny Lo, politics lecturer at the University of Hong Kong, referring to the mass demonstrations that forced the government to withdraw anti-subversion legislation and led to the resignations of three ministers.

"More people have come out to fight for gay rights, the unemployed, ethnic minorities and other marginalized groups," he said.

Cheung, 28, is running as an independent. He joins an assortment of teachers, social workers and fresh school leavers making a pitch to voters who have felt the power that comes through a collective voice.

"People are more politically aware now and we should press for democratic reforms," Chung said.

Rabbi Imran, an electronics trader, is running on an issue close to the hearts of Hong Kong's small Muslim community: halal food in schools.

"Not a single school in Hong Kong has catering services for people who eat halal food," he complained. "Many Muslim children now go hungry until they reach home."

"If I get elected, I will push for schools with Muslim pupils to provide halal food in canteens."

Four hundred seats are up for grabs in the Nov. 23 election. Some 840 candidates have thrown their hats into the ring, up from 800 in the last 1999 polls. A record 2.4 million residents are eligible to cast votes -- 170,000 of them for the first time.

Previously, candidates have been roughly divided into pro-Beijing and pro-democracy camps.

Chinese leaders will be watching these polls closely. Significant gains for the democrats would be seen as a mandate for faster democratization, which Beijing has resisted.

University tutor Mary Ann King, 39, vying to represent the harborfront district of Wanchai, said: "Once I'm elected, I will help to get more compensation for residents who have been ordered out of their homes to make way for redevelopment."

It will be a tough fight for many new faces who lack the financial backing and core of loyal supporters that pro-China politicians command.

One formidable force is the Democratic Alliance for the Betterment of Hong Kong (DAB), a party that showers potential supporters with banquets and free holidays in China.

"Lots of residents don't even allow us to put up our posters in their estates because they are DAB supporters. Some even refuse to have me stand outside their shops," said King.

But the tide may be turning. The DAB fell out of favor with many residents in July when it sided with the government over the unpopular anti-subversion law.

Tsai says reform an urgent matter

By Melody Chen

STAFF REPORTER

Thursday, Nov 13, 2003,Page 1

Mainland Affairs Council (MAC) Chairwoman Tsai Ing-wen said constitutional reform was an urgent matter and urged the US to bring China and Taiwan back to the negotiating table.

Tsai made the comment before leaving on a trip to Washington yesterday.

Her departure to the US came a day after President Chen Shui-bian unveiled his timetable for creating a new constitution to visiting academics from the Brookings Institution in the US.

The academics, most of them former officials in the US government, attended a conference titled "Democracy, Nationalism and Security in the Asia Pacific" in Taipei.

Tsai will give speeches on the government's cross-strait policies to US academic institutions and hold closed-door meetings with several think tanks during her weeklong visit to Washington.

Johns Hopkins University's School of Advanced International Studies and the Carnegie Endowment for International Peace has invited Tsai to give a speech on cross-strait relations today, the MAC said.

On Saturday, Tsai will deliver another speech to overseas Taiwanese based in Washington.

Tsai declined to say whether she will be meeting with US government officials on her trip.

At the conference, Tsai said inefficiency in the political system and within the constitutional framework has contributed to the chaos people have experienced over the past three and a half years.

Constitutional reform will deepen Taiwan's democracy and give the people more power, she said.

Although some see Chen's referendum and constitutional proposals as polarizing the nation's political parties, Tsai said debate on such issues is not a bad thing.

"Taiwan's social and political system is strong enough for us to have good and sensible debates over the issues we are facing," she said.

Tsai said China's political situation, economy and society cannot develop sustainably unless the country heads toward democracy.

Meanwhile, the US, she said, should try to help reopen dialogue between China and Taiwan under the framework of international organizations, such as the WTO.

The US and European countries should urge China to respect human rights and secure its people's civil and political rights, Tsai said.

Philip Yang, professor of political science from National Taiwan University, said Chen's announcement of the timetable for a new constitution and Tsai's Washington visit are evidence of the government's efforts to lay out a clearer constitutional plan.

Yang said, however, that the US will not voice opposition to or support for developments in Taiwan's internal affairs.

Yang said Chinese Premier Wen Jiabao, who will also visit Washington next month, is expected to express China's views on recent cross-strait developments.

With Taiwan's presidential election approaching, China has perceived changes in US policy toward Taiwan, particularly after American Institute in Taiwan Chairwoman Therese Shaheen's visit to Taiwan and Chen's trip to the US, Yang added.

China, Yang said, would like to know whether these changes mean the US has shifted its policy.

Pan-blue camp celebrates Sun Yat-sen's anniversary

ROC DEFENDERS: With their lead in the polls almost gone, KMT Chairman Lien Chan and PFP Chairman James Soong urged the public to protect the Republic of China

By Ko Shu-ling

STAFF REPORTER

Thursday, Nov 13, 2003,Page 3

Unable to consolidate their advantage in opinion polls, the Chinese Nationalist Party (KMT), People First Party (PFP) and New Party yesterday staged a low-key rally outside Sun Yat-sen Memorial Hall to mark the 138th birthday of the founding father of the Republic of China.

Despite the overcast sky, the gathering drew about 1,000 supporters of the pan-blue camp's pro-unification stance. But the event came as the KMT-PFP alliance's ticket for next year's presidential election was gradually losing ground to the Democratic Progressive Party (DPP).

Political observers have credited President Chen Shui-bian for his ability to maneuver public opinion by introducing new issues and trumpeting new ideas.

According to a survey by the pro-pan-blue camp, Chinese-language United Daily News yesterday, the gap between a DPP ticket consisting of Chen and Vice President Annette Lu and the pan-blue ticket of KMT Chairman Lien Chan and PFP Chairman James Soong was four percentage points. The Chen-Lu ticket received 38 percent support, the Lien-Soong ticket 42 percent.

If Chen teamed up with Taipei County Commissioner Su Tseng-chang, the pairing outscored Lien and Soong by 40 percent to 38 percent.

A poll released by the China Times last Thursday showed that Chen and Lu had pulled ahead of the pan-blue ticket for the first time, 35 percent to 34 percent.

Previous polls, even those conducted by the DPP, showed Chen and Lu much further behind.

During yesterday's rally, Lien called on the public to safeguard the Republic of China (ROC) after former president Lee Teng-hui denied its existence.

"When Dr. Sun founded the ROC 92 years ago, his vision of creating a country for the people, by the people and of the people was daring and inspiring," he said. "As his staunch believers, we're duty-bound to unify for the benefit of the nation and the people."

Next March's presidential poll is a key moment, Lien said, because Taiwanese people will have to decide whether to let the country continue down the path set by the founding father or run the risk of seeing the demise of the ROC.

"I'm calling on you to let the torch of democracy continue to shine bright and to build this land into a strong bastion to safeguard peace, freedom and democracy," he said.

Echoing Lien's rhetoric, Soong said that it was important to fashion a new Taiwan rather than wipe out the ROC.

"The ROC is the best guardian angel of Taiwan," he said. "There wouldn't be a Taiwan today if the ROC disappeared in 1949 when the KMT troops relocated to the island.

"What we need right now is compromise among ethnic groups, peace across the Taiwan Strait and prosperity around the nation, not the disappearance of the ROC itself and a rewriting of the ROC Constitution," Soong said.

For the past two months Chen has been promoting the idea of rewriting the Constitution. On Tuesday, he set a date for a referendum on a new constitution, Dec. 10, 2006.

Taiwan as a hub for regional integration

By Chang Ming-chung

Thursday, Nov 13, 2003,Page 8

In recent times China has been working on forging an organization promoting regional cooperation with ASEAN, Japan and South Korea. Some critics have pointed out that Taiwan might be marginalized as it is still preoccupied with political infighting.

A slang Chinese expression points out that it is hard to be successful when trying to foster cooperation. The Asia-Pacific region has become closely integrated, as demonstrated by the fact that intra-regional trade volumes have soared in recent years. Taiwan has been playing a vital role in this integration process. It would not be undeserved if Taiwan became known as a center for Asia-Pacific integration.

Taiwan has not made any particular effort to attain this goal; it simply followed the right path. Taiwanese are more practical and place more emphasis on fields of specialization based on the principle of comparative advantage. This has led Taiwan and its neighbors to forge a complementary relationship.

Some argue that a portion of Chinese products are competitive but a great majority of these same products are manufactured by Taiwanese companies. Also, many Chinese companies commission Taiwanese manufacturers to oversee production and do not engage in export trade. So, Tai-wan and China are complementary as well.

The countries that are more competitive with Taiwan might be the other three "Asian Tigers" but the degree of conflict is not as large as we might imagine.

South Korea, for example, specializes in mass production and brand management. Taiwan focuses on a small quantity of diversified and fashionable products as well as original equipment manufacturing (OEM) operations. In the semiconductor industry, South Korea specializes in DRAM chips while Taiwan empha-sizes wafer OEM and integrated-chip design.

Taiwan is well known for OEM, making the nation a hub for linking upstream and downstream factories. It therefore complements advanced countries. Moreover, to reduce OEM costs, Taiwanese businesspeople set up shop in China and Southeast Asia, boosting their manufacturing industries and integrating them within the global trade network.

Compared with Taiwan, South Korea is less willing to play second fiddle. Hong Kong and Singapore lack independent manufacturing capabilities that Tai-wan and South Korea possess. Therefore, Taiwan is the real center for Asia-Pacific integration.

From a political perspective, Taiwan also enjoys some unique advantages.

First, it is one of the few countries in the region that does not have an anti-US or anti-Japan complex. This explains why the US afforded President Chen Shui-bian an unprecedented level of treatment during his transit stop in New York, although rumors have spread that the US is dissatisfied with Chen's plans to hold referendums and introduce a new constitution.

Second, because Taiwan never invaded Southeast Asia, it will not be snubbed like countries with an imperial track record.

Third, because Taiwan is being constantly browbeaten by China, other countries will not take precautions against Taiwan.

Two other features are conducive to making Taiwan an Asia-Pacific integration center: the large number of ethnic Chinese in Southeast Asia, many of whom studied in Taiwan, and the many Southeast Asian laborers here.

In the face of China's efforts to form new alliances, Taiwan could fortify its advantages by opening up more of its markets to countries in the Asia-Pacific region.

Some might say this strategy would be humiliating, but the plan should be evaluated on the basis of its practical benefits. At the very least it will allow Taiwanese to enjoy inexpensive products and services from abroad.

Chang Ming-chung is a professor of economics at the National Central University.

Editorial: A rendezvous with history is set

During a meeting with American friends from the Brookings Institution on Tuesday, President Chen Shui-bian said that he hoped to hold a referendum on Dec. 10, 2006 to enact a new constitution, so that the president who takes office in 2008 can implement it. This was the first time Chen clearly said that he would push for a new constitution, not just amendments to the existing one. It was also the first time he has given a timetable for the process.

Chen chose Dec. 10 because it is International Human Rights Day. There is great significance behind choosing that day as the starting date. The designation of an International Human Rights Day was a major milestone in the history of political evolution. It was an indication of the transition from "God-given imperial power" to "God-given human rights." Humanity's political thinking has evolved into referendums commonly accepted by civilized societies.

Starting the democratic engineering project of creating a constitution on International Human Rights Day is in the spirit of the UN's human-rights efforts. It has the effect of strengthening democratic values and inspiring people living in authoritarian nations such as China. It is an act that deserves the support and blessing of all countries around the world that support democratic values.

By setting a date, Chen has indicated that the referendum legislation, an issue that the blue and green camps have been wrangling over, must be concluded before that time. The legislation will serve as a legal basis for referendums. Since the people want to promote a new constitution by way of a referendum, this legislation must not be the "bird-cage" version proposed by the Chinese Nationalist Party (KMT) - People First Party (PFP) alliance. The people must act to prevent the emergence of a referendum law that would actually restrict their freedoms, of legislation that would be a remake of martial law.

The people of Taiwan need to be on alert about the blue camp's attempts to use the referendum legislation to toady to China and restrict the people's power.

The current Constitution of the Republic of China (ROC) was never really implemented. It was enacted for China in 1947. When former president Chiang Kai-shek's regime fled to Taiwan, he froze the Constitution and replaced it with the "Temporary Provisions Effective During the Period of Communist Rebellion." Those provisions were not abolished until 1991.

The Constitution remains anachronistic even though it was amended six times during former president Lee Teng-hui's 12 years in power. Its framework still does not reflect Taiwan's status and the people's wishes. At a time when the feudalistic atmosphere of the exiled KMT regime was still strong, Lee could only pushed for small-scale changes in order to pave the way for his political reforms.

This Constitution is just as ridiculous as the "map of the ROC" that includes the PRC and the Republic of Mongolia.

Exiled Chinese dissident Cao Chang-qing said recently that he was shocked to seek the ROC map displayed in the Government Information Office during his first visit to Taiwan. He asked then GIO chief Chang King-yuh, "Taiwan is not a UN member. How come it has incorporated two UN members in its territory?"

The people want to know why such anachronisms as outdated maps and irrelevant constitutions still exist as well. They should insist that these anachronisms be eliminated.