Government denies ‘dollar diplomacy’
　

PLANE TRUTH?: The Presidential Office and the Ministry of Foreign Affairs said that the donation of a jet and helicopter to Panama was a proper offering of aid
　

By Ko Shu-ling and Shih Hsiu-chuan
STAFF REPORTERS
Tuesday, Dec 29, 2009, Page 1

The Presidential Office yesterday defended the government’s recent donation of a jet to the Panamanian government, saying President Ma Ying-jeou (馬英九) opposed “checkbook diplomacy” but was not against offering aid to diplomatic allies if the money was used properly.

“Since his presidential campaign, the president has emphasized that he is against ‘checkbook diplomacy’ or ‘dollar diplomacy’ because the source or flow of the money isn’t clear,” Presidential Office Spokesman Wang Yu-chi (王郁琦) said. “However, he is not against using money in a proper way if there is a clear and specific plan.”

A report published in yesterday’s Chinese-language China Times cited Panamanian media reports as saying that Taiwan hadn’t stopped its “checkbook diplomacy” after Ma took office in May last year.

The report said the Ma administration donated an Embraer Legacy 600 jet to Panamanian President Ricardo Martinelli after his plan to replace his presidential jet was rejected by the public. The report also said the deal was struck when Ma attended the inauguration of Martinelli on July 1 this year.

During former president Chen Shui-bian’s (陳水扁) term, the Chinese Nationalist Party (KMT) harshly criticized him for “checkbook diplomacy.”

Latin America has long been a diplomatic battlefield between Taipei and Beijing. Panama, one of the most strategically significant countries in the world because of the Panama Canal, has been at the center of speculation about countries that might switch allegiance from Taiwan to China.

At the legislature’s Foreign and National Defense Committee yesterday, Minister of Foreign Affairs Timothy Yang (楊進添) also denied the donation amounted to “checkbook diplomacy.”

Democratic Progressive Party Legislator Tsai Huang-liang (蔡煌瑯) said there could have been a kickback involved in the deal, adding that the Ma government gave Panama US$40 million to buy the jet, which cost less than US$28 million. Tsai demanded Yang investigate the case.

Tsai, however, had apparently misread the China Times report, in which it quoted the Panama paper as saying that the country obtained a donation of US$40 million from Taiwan, with the jet estimated at US$28 million and a Bell 412 helicopter valued at US$12 million.

Yang said the jet was part of a cooperative program between the two governments after the two sides reviewed its necessity using “an open and transparent process.”

“Panamanian President Martinelli made the request for the jet after he assumed office. [Martinelli] said the jet was to be used in emergency rescue and operations to crack down on drug-smuggling at its border … The jet was officially handed over to Panama and listed as public property,” Yang said. “After handover of the jet, there was no way for the [Taiwanese] government to know if the jet was used for purposes consistent with the reasons we agreed to for the donation.”

In related news, Yang confirmed the government had received requests from the US to provide non-military aid to US troops in Afghanistan such as medical or engineering assistance.

“From my understanding, the US has expressed the wish [to Taiwan], but we are deliberating on the matter carefully and haven’t made any decision. Sending personnel is one thing and giving donations is another,” Yang said.

Cross-strait pacts won’t need legislative approval
　

By Ko Shu-ling
STAFF REPORTER
Tuesday, Dec 29, 2009, Page 1

The three pacts signed between Taipei and Beijing last week will automatically go into effect 90 days after approval by the executive branch, the Mainland Affairs Council (MAC) said yesterday.

MAC Deputy Minister Liu Te-shun (劉德勳) said the three agreements do not require legislative review because they do not concern revisions to existing law.

The Act Governing Relations between the Peoples of the Taiwan Area and the Mainland Area (台灣地區與大陸地區人民關係條例) stipulates that agreements that do not require legal amendment automatically take effect within a certain period of time after being referred to the legislature from the executive branch.

The Democratic Progressive Party (DPP) caucus said yesterday that the legislature does not have sufficient time to review the content of the agreements.

Taiwan and China last Tuesday signed three accords on fishing crews, quality checks and quarantine of agricultural products and standardization of non-agricultural products.

Both sides had originally planned to ink four agreements, but dropped one on the avoidance of double taxation after negotiations broke down because of “technical problems.” It was the first time an issue placed on the agenda of the cross-strait high-level talks had not been signed.

Liu yesterday said that the council does not oppose signing the agreement on the avoidance of double taxation before the next round of cross-strait official talks, which are scheduled for the first half of next year.

However, since the accord was not signed this year, China-based Taiwanese businesspeople would not be able to benefit from it until they file their income tax in 2011, Liu said.

Meanwhile, MAC Deputy Minister Chao Chien-min (趙建民) said yesterday the public wanted to see China repatriate well-known white-collar criminals such as former Tuntex Group chairman Chen Yu-hao (陳由豪).

Chen allegedly embezzled tens of billions of NT dollars from Taiwanese investors and is believed to be living in China.

Chao made the remarks while briefing foreign ambassadors and representatives about the talks at the Ministry of Foreign Affairs yesterday morning.

Chao said China had repatriated 12 fugitives linked to seven criminal cases since the two sides inked an accord on judicial assistance and a joint effort to combat crimes in June last year.

James Chang (章計平), deputy director-general of the Ministry of Foreign Affairs, told reporters later that after the two sides signed an economic cooperation framework agreement (ECFA), they could talk about security issues, such the missiles China has aimed at Taiwan.

Chinese dissident wants PRC to follow Taiwan model

STAFF WRITER, WITH CNA
Tuesday, Dec 29, 2009, Page 1

Liu Xiaobo (劉曉波), a prominent Chinese dissident who was sentenced to 11 years in jail by a Beijing court on Friday, said last year that he dreamed China could develop a democratic system similar to that in Taiwan.

Liu, who had been detained since December last year, was given the jail term on charges of “inciting subversion of state power,” a vague term that China uses to prosecute its dissidents.

In interviews before the 2008 Beijing Olympics, Liu said he was very interested in Taiwan’s recent democratic development and that it could serve as “enlightenment or a model” for China.

“I’m very curious about what the younger generation in Taiwan has been thinking and doing, as this is an important indicator of the direction in which Taiwan will move,” he said.

Liu, who has been jailed several times as a political prisoner since 1989, has never shown any sign of cynicism or resentment, unlike many other persecuted Chinese dissidents.

“I know what I have been doing and what kind of cost I have to pay for that,” he told reporters in his small home in Beijing.

On the contrary, he expressed a great deal of tolerance toward the policemen who arrested him.

“The men who nabbed me are probably good fathers when they have their uniforms off at home,” Liu said.

Although Liu was 53 years old at the time, he said he and his wife had decided not to have a child.

“We are not against having a child, but rather we don’t dare have one, as human rights are never respected in China nowadays, so we have ‘a hundred reasons’ not to have one,” he said.

Liu was arrested last December on the eve of the release of “Charter 08,” a blueprint Liu co-authored with about 300 intellectuals across all spectrums of Chinese society that calls for an end to the Chinese Communist Party’s (CCP) dominance of the government, military and courts, protection of freedom of speech and religious beliefs and implementation of constitutional democracy.

“Charter 08” is reported to have been signed by more than 10,000 people so far, many of whom are leading intellectuals in China.

In 1989, Liu cut short a visiting scholar program at Columbia University in the US to return to Beijing and join the hunger strike at Tiananmen Square that led to the bloody military crackdown known as the Tiananmen Massacre.

He was then detained at Qincheng Prison near Beijing on charges of “anti-revolution” for his role in the incident.

After his release in January 1991, Liu refused to go into exile and instead chose to stay at home to promote democratization. He was jailed again in May 1994 for more than six months for his appeals for justice for the victims of the 1989 massacre.

In October 1996, Liu was sent to a labor camp in Liaoning Province for three years after he advised a CCP congress session to launch a national anti-corruption drive.

His insistence on human rights and democracy has earned him numerous awards from Human Rights Watch, Reporters without Borders and other international organizations.

Liu’s latest sentence triggered outcry from international human rights organizations and Western countries, with the US pressing Beijing for his immediate release.

On Saturday President Ma Ying-jeou (馬英九) called on China to demonstrate “the greatest possible tolerance” toward its dissidents.

Human Rights Watch said that since 2003, China has sentenced more than 35 people on charges of inciting subversion of state power to prison terms ranging from one-and-a-half to 11 years, with Liu being the most severely punished.

Prosecutors seek US assistance in Chen family case
　

By Shelley Huang
STAFF REPORTER
Tuesday, Dec 29, 2009, Page 3

Prosecutors in charge of investigating former president Chen Shui-bian’s (陳水扁) corruption and money laundering cases recently requested that US judicial authorities return the fugitive Huang Fang-yen (黃芳彥), who has been accused of helping the former first family hide and launder assets.

The former deputy superintendent of the Shin Kong Wu Ho-Su Memorial Hospital and close friend to the former first family was charged with violating the Money Laundering Control Act (洗錢防制法) by allegedly helping the former first family hide and launder money.

The Supreme Prosecutors’ Office’s Special Investigation Panel (SIP) alleged Huang had helped former first lady Wu Shu-jen (吳淑珍) hide diamonds, jewelry and NT$60 million (US$2 million) after a search of his residence produced some evidence.

However, prosecutors said NT$220 million in laundered funds remained unaccounted for.

Prosecutors hope that through judicial mutual assistance, the US would return Huang to Taiwan for questioning about the source of the funds to help investigators determine whether the former first family obtained the money through illegal means.

Huang has been on the wanted list since March. He fled to the US in November last year before prosecutors could question him about allegations that he helped the former first family launder money.

Huang was initially believed to be living in California after TV footage showed him answering a reporter’s questions, saying he would return to Taiwan as soon as he had taken care of personal matters in the US. However, he has repeatedly ignored prosecutors’ summons.

Prosecutors said they have recently gathered information that indicates Huang is likely to be hiding in New Jersey.

Wang Dan warns of PRC student activity in Taiwan
　

By Tsau Chih-Ming and Chang Jui-chen
STAFF REPORTERS
Tuesday, Dec 29, 2009, Page 3
　

Chinese democracy activist Wang Dan (王丹) stirred debate recently over his suspicions that Chinese students may be “conducting organized activities” on college campuses in Taiwan.

In his latest post on Facebook, Wang said he raised the matter because he wanted to remind Taiwanese that this was now taking place in their country.

Wang, who is a guest lecturer at Chengchi University’s Graduate Institute of Taiwan History, gave a speech at Providence University in Taichung on Thursday titled “How to See the Real China.” During the two-hour event, a group of Chinese students studying in Taiwan challenged Wang, a student leader during the Tiananmen Square Massacre in 1989.

After the incident, Wang alleged that the students had planned to do this on his Facebook page.

Liao Jui-ming (廖瑞銘), an associate professor at the university’s Department of Taiwanese Literature who attended the event, said that while the students might have been within their rights to challenge Wang, the manner in which they did so highlighted their poor understanding of democracy vis-a-vis their Taiwanese counterparts.

A video of the incident shows some Chinese students repeatedly questioning the content of Wang’s speech, which addressed, among other subjects, dishonesty and cynicism in Chinese society.

They accused him of being unfair to the Chinese people because of his hatred for the Chinese Communist Party (CCP).

On his Facebook page, Wang said the incident didn’t look like individual behavior.

“Doesn’t the thought of Chinese students engaging in organized activity on Taiwanese campuses give you the chills?” Wang asked.

Wang said he was not making sensational comments to scare the public, adding that student council president at University of Hong Kong, who had previously made comments to the effect that there was no such thing as a Tiananmen Square Massacre on June 4, 1989, was elected following organized voting by Chinese students.

“Taiwanese should take note of these things and not be too naive,” Wang said.

Liao said the 70 students who attended the speech were free to ask questions. However, few Taiwanese students were able to do so, as the Chinese students dominated the session. He said that while Wang might have been slightly intimidated by the scene, the atmosphere actually wasn’t too bad.

Wang said the Taiwanese students were too “mild,” while thanking the Chinese students for the “shock” after his speech.

Some Taiwanese students in the audience said they didn’t think the atmosphere was intense at the time, adding that although the comments made by the Chinese students were sharp, they stemmed from nationalist sentiment and were nothing to worry about.

Replying to a question by a Chinese student, Wang “alerted” Taiwanese students by asking them if they felt that the Chinese students had come “prepared.”

Wen Tsung-han (溫忠翰), a ­student at the Institute of Taiwan History in charge of receiving Wang at the event on Thursday, said that about 10 Chinese students attended the speech, seven of whom were seated in the front row.

They took notes diligently and adopted a strong tone in their questions. Some remarks were unfriendly, Wen said.

Wen said the possibility of “professional students” never crossed his mind.

Wang said his initial reaction was to assume that the Chinese students had perhaps not heard different views on the massacre, which would explain their strong reaction to his criticism of China. Only afterwards did it dawn on him that something “wasn’t right,” he said.

Liao said Wang’s warning to Taiwanese students was well-­intended and added that the Taiwanese in the audience had displayed great respect for differences of opinion during the event.

When a Taiwanese student asked Wang about China’s progress on democracy, Liao said, the student took a moment to send “his regards” to a Chinese student who had spoken before him, saying that “the student from China loves his motherland very much. I also love my motherland very much, but I do not love China.”

Breakdown in cross-strait talks highlights problems
　

WEAK HAND: Pressure by Taiwanese businesses based in China, added to a poor negotiating approach, could spell trouble for Taiwan in future talks, analysts say
　

By Ko Shu-ling
STAFF REPORTER
Tuesday, Dec 29, 2009, Page 3

The breakdown of negotiations on a tax agreement last week highlighted the government’s long-standing problems with backroom decision-making and poor communication, analysts said.

While both sides are set to negotiate an economic cooperation framework agreement (ECFA) next year, analysts were concerned that Taiwan might have to pay a bigger price next time around.

The two sides had planned to sign four agreements during last week’s cross-strait talks on fishing crews, quality checks and quarantine of agricultural products, standardization of industrial products and double taxation. Talks on double taxation, however, were dropped because of “technical problems.”

This marked the first time that an issue placed on the agenda for a cross-strait meeting was not signed. Both sides have held four rounds of high-level meetings since President Ma Ying-jeou (馬英九) took office in May last year and have signed 12 agreements and one consensus.

Government agencies and officials offered different theories for the stalemate in negotiations.

The Ministry of Finance said it was mainly the result of a dispute over levying income tax on China-based Taiwanese businesspeople according to where they reside or where income is earned. Meanwhile, Premier Wu Den-yih (吳敦義) said the deal was delayed because the treaty would have treated Taiwan on equal footing with Hong Kong.

Some said it was because of strong opposition from China-based Taiwanese businesspeople who feared the accord would compromise their interests.

Tung Chen-yuan (童振源), a professor at the Graduate Institute of Development Studies at National Chengchi University, said it was hard to tell with certainty what caused the breakdown in negotiations because the administration did not release all the information.

He nevertheless said that it was a “good thing” that the government was willing to stop the process when it encountered problems. The incident also highlighted the manner in which the administration handles negotiations: poor planning and bad communication, he said.

While the two sides agreed to place an ECFA on the agenda of the next round of cross-strait talks next year, Tung said he suspected Taiwan would be forced to make concessions both on the economic and political fronts because the administration looked desperate at the negotiation table.

“China is accumulating its bargaining chips so it can negotiate from a position of strength,” he said.

Tung pointed out three mistakes the Ma administration made before the negotiations on the proposed pact began.

First, Ma expressed his strong desire to sign an ECFA and said it must be done as soon as possible. It put Taiwan in an unfavorable position because China could easily make demands.

Second, the Ma administration revealed its bottom line by not allowing more imports of Chinese agricultural products and workers.

Finally, the government unveiled its “early harvest” list, which again underscored its bottom line, Tung said.

Compounding the problem was the administration’s reluctance to communicate with the public, the opposition and even the other ruling party members, Tung said, adding that Ma announced his intention to sign an ECFA before any assessment had been conducted.

Another example of the government’s lack of communication was the relaxation of restrictions on US beef, Tung said. The government not only did a poor job in rolling out the policy, but also coerced the public into accepting the deal despite a public outcry.

Another example was the signing of the three financial memorandums of understanding (MOU), Tung said. While Financial Supervisory Commission Chairman Sean Chen (陳冲) remained silent on the details of the MOU at the legislature, a few hours later he unexpectedly announced that the commission had completed the signing with its Chinese counterpart via a document exchange.

Tung said he suspected China would make more concessions in the end, because its strategic goal was to use Taiwan’s economic reliance to attain the goal of unification.

“But what will Taiwan have to pay in return? That’s what we should worry about,” he said.

As the two sides could soon launch negotiations on an ECFA, Tung said Ma should debate the matter with Democratic Progressive Party Chairperson Tsai Ing-wen (蔡英文). Tung also proposed to put the deal to a vote, either before it is signed or afterwards.

Tung Li-wen (董立文), a professor at the Graduate School of Public Security at Central Police University, said last week’s talks were nothing but theater.

He said that Legislative Speaker Wang Jin-pyng (王金平) revealed that Wu had told him one week before the talks that the two sides were likely to sign only three agreements.

However, the government kept the public in the dark and continued to promote the four deals.

“It is pure humbug,” Tung Li-wen said. “I don’t think the premier or legislative speaker would lie about anything like that.”

He said the collapse of the negotiations was the result of a backlash among China-based Taiwanese entrepreneurs who did not want to see their interests jeopardized. Another possibility is that the government was unsure about the effect of the deal and opted to delay it.

Tung Li-wen said the breakdown in negotiations was a symptom of the government’s backroom operations, which also highlighted its slipping grip on cross-strait negotiations.

Beijing, on the other hand, has increasingly dictated the agenda and set a timetable for when to sign and whether to implement, Tung Li-wen said.

On an ECFA, Tung Li-wen said he worried that the government would play the same trick again and deceive the public as it did on the tax agreement.

While the Ma administration said it wanted to seal the deal next year, he said he suspected it would take a slow approach because it was not sure whether the trade pact would improve Taiwan’s economy and prevent the country from being marginalized as it claims, he said.

Lee Yeau-tarn (李酉潭), a professor at National Chengchi University’s Graduate Institute of Development Studies, said he had no problem seeing Taiwan increase its engagement with China, but the Ma administration must bear in mind that China is an authoritarian regime who has a clear political agenda of annexing Taiwan.

Democracy should be Taiwan’s best bargaining chip at the negotiation table, Lee said, but the government does not seem to fully comprehend the power of the opposition, the public and the legislative branch.

“For Beijing, Taiwan is an affliction that gives it a lot of pain,” he said.

To sign an ECFA is strategically sound, but the preconditions the government has set and its attitude are problematic, he said.

“Facing regional economic integration, it is not a matter of whether Taiwan should sign the accord, but how to strike the best deal,” he said. “Doing this will require a wise statesman who strives for a better position for Taiwan.”

Lee said the governing and opposition parties must sit down and talk, put differences aside and place the national interest before their own.

Lee said Ma might have a mind to protect Taiwan’s interests, but he hoped the president would also look at the complicated relationship between his party and the country with clarity.

There is a chance that his reform efforts will cost his re-­election, but if he loses the courage and wisdom to push on, the problems will be more serious, he said.

“It is up to Ma to decide whether the national interest outweighs his personal ones,” he said.

Ma should be grateful to protesters
　

By Chen Mao-hsiung 陳茂雄
Tuesday, Dec 29, 2009, Page 8

‘If it were not for the independence supporters taking on China, Taiwan’s negotiating space would be a lot smaller.’

Last week’s visit to Taichung by Association for Relations Across the Taiwan Strait Chairman Chen Yunlin (陳雲林) was met with daily protests by Taiwan independence advocates. In the short term, the government of President Ma Ying-jeou (馬英九) will lose marks because of these protests, but it in the long run it will gain from them.

Ma loses in the short term, not because of the pro-independence protests themselves, but because of the public inconvenience and resentment caused by the government’s security measures. The long-term benefit comes from the protesters playing the role of China’s main adversary, allowing Ma’s government to be its secondary adversary and so gain more room for negotiation.

Ma’s opinion poll ratings are ridiculously low. If this doesn’t change, it will be hard for him even to be nominated as the Chinese Nationalist Party’s (KMT) candidate for the 2012 presidential election, never mind getting re-elected. Ma is pinning all his hopes on signing a cross-strait economic cooperation framework agreement (ECFA) with China. If, in the course of ECFA negotiations, China lets Taiwanese reap some tangible benefits, Ma’s political career could be salvaged. The problem is, however, that China may not do what Ma wants. Although the Chinese have come out with a lot of sweet talk, they never forget their ultimate goal of unifying Taiwan with the motherland.

Beijing reckons it can bring Taiwan back into the fold even without providing benefits, so why should it provide them? It is an odd situation. In personal relations, if someone makes a goodwill gesture, most people will respond in kind. When it comes to politics, things are not so simple. Although Ma has shown goodwill to China, Beijing has failed to reciprocate. From China’s point of view, although Ma is not the same as the Democratic Progressive Party, he is also an obstacle to unification.

While the world is appears to be moving toward democracy and away from dictatorships, which have been crumbling one by one, China’s government maintains its grip on power by using extraordinary nationalistic fervor. If everyone is super-nationalistic, they are more likely to support the government. The regime of former Iraqi president Saddam Hussein was a prime example. In China’s case, its people’s strong nationalism is expressed in anti-Japanese sentiment and their determination to see Taiwan united with China.

Successive presidents have had no room to negotiate with China, because Beijing insists that there is only “one China,” of which Taiwan is an inseparable part. It is not willing to make the slightest concession on these points. Former presidents refused to hold negotiations entirely according to China’s preconditions, so the two sides had nothing to say to one another.

Ma has taken a more humble approach, but China has shown little gratitude. This leaves Ma in a predicament. While the fruits of his government’s negotiations with China fall far short of what was hoped for, critics at home call Ma a traitor for making too many concessions. If only someone would play the role of China’s main adversary, making the Ma government its secondary adversary, it would give him more room for negotiation.

Ten years ago, I took over as head of the general affairs section of my university. The job did not go smoothly at first, because my predecessor got on very well with the hundred or so staff in the general affairs section, and they had formed quite a close-knit clique. The former section head resigned only because he got on badly with the school’s principal, and before stepping down he said that nobody would be able to succeed him. I was up against covert resistance from the former head’s clique, which made it hard to get anything done. In fact I even risked falling into a trap that could put me in jail. It was a crisis.

One of the college deans at the time was given to criticizing the way the university was run, and often criticized the general affairs section staff at regular department head meetings. Seeing an opportunity, I immediately took on the role of defender of the section and refuted the criticism. Arguments between this dean and myself became a regular feature of the weekly meetings, and all my staff knew about them. In this way, it only took a few weeks to form a team. Facing an external adversary, the staff forgot their hostility to me as the new section head and even became quite friendly.

The independence protestors’ demands are equal to China’s demand for unification, and neither side is willing to give ground. In heckling Chen at every turn, and in quite an extreme manner, the pro-independence side has helped provide the Ma administration with more room to negotiate. If it were not for the independence supporters taking on China, Taiwan’s negotiating space would be a lot smaller.

Chen Mao-hsiung is a professor of electrical engineering at National Sun Yat-sen University.

Economics and politics cannot be separated
　

By Wang To-far 王塗發
Tuesday, Dec 29, 2009, Page 8

The fourth meeting between Straits Exchange Foundation (SEF) Chairman Chiang Pin-kung (江丙坤) and Association for Relations Across the Taiwan Strait (ARATS) Chairman Chen Yunlin (陳雲林) focused on four issues: cooperation on standardizing inspections and certification; quarantine and inspection of agricultural products; avoidance of double taxation and cooperation on fishery labor affairs. These issues, in addition to the memorandum of understanding on financial supervision and management, as well as the opening up of Chinese investment in Taiwan, were designed to establish a single China market with the ultimate goal of unification.

President Ma Ying-jeou’s (馬英九) administration claims these agreements simply promote the economy and prevent Taiwan from being marginalized. It says there is no political element to the proposed economic cooperation framework agreement (ECFA). It is, however, trying to hoodwink the public under the rubric of maintaining a separation of politics and economics.

History tells us that there is no such thing as a separation of politics and economics. We have seen repeated instances of wars fought for economic interests: the Opium War, the Sino-Japanese War, the clashes between eight European powers and the Qing Dynasty in the 19th century, and, more recently, the US-led invasion of Iraq. Any given economic policy is inherently political.

Beijing’s insistence on setting its “one China” policy as a precondition for negotiations is an example of politics leading economics. You only have to listen to Chinese President Hu Jintao (胡錦濤), Chinese Premier Wen Jiabao (溫家寶) and other Chinese officials to see the similarities between the ECFA and the closer economic partnership agreements China signed with Hong Kong and Macau. Both were economic cooperation arrangements with the precondition of acknowledging the “one China” policy.

The aim is to incorporate Taiwan within the single China market. Beijing is trying to make Taiwan’s economy inextricably meshed with its own, with the ultimate political objective of being able to absorb Taiwan without a single shot being fired.

Ma’s basic position is this: Taiwan has to be more competitive, given the trend toward globalization and fierce international competition, and its best bet is cooperation with China. His idea is to benefit from a division of labor, whereby research and development is carried out in Taiwan but the manufacturing is done in China. To this end, he wants to see Taiwan open up to China, and to concentrate on China for both investment and exports.

Estimates published in the May 9 edition of The Economist showed Taiwan has already invested some US$400 billion in China. More than 80 percent of Taiwan’s investment overseas is in China. Taiwan, therefore, is well on the way to becoming overly dependent on China, economically speaking, and at risk of coming under its control.

The folly of not distinguishing friend from foe, and in fact allowing oneself to become economically reliant on the latter, is exposing Taiwan to serious danger.

Taiwanese investment in China is contributing to the rapid growth in China’s economy, providing it with both capital and technology. This is fueling the rapid modernization of China’s armed forces and helping it build a military empire. China has 1,400 missiles aimed at Taiwan, posing a serious risk to Taiwan’s survival.

This is the result of the policy of not distinguishing friend from foe, and a catastrophe in the making born of the pretence of the separation of economics and politics. When will the Taiwanese wake up?

Wang To-far is a professor of economics at National Taipei University.