July 16, 2002	Tuesday	Jamadi-ul-Awwal 5, 1423

TAIPEI: Recent statements from Taiwan and mainland China have heightened speculation that the two longtime adversaries may at last be preparing for talks to open direct trade, transportation and telecommunications links across the Taiwan Strait.

Hints of possible change first came in May, when Taiwanese President Chen Shui-bian indicated a willingness to let non-governmental groups play a role in negotiating the direct links. Beijing quickly applauded Chen’s comments and even established a special trade promotion committee.

Because the mainland Communist authorities view Taiwan as a rebel province that rightly belongs under their control, they have consistently refused government-to-government talks.

Earlier this month, Chinese Vice Premier Qian Qichen appeared to drop Beijing’s long-standing precondition to talks: that Chen endorse the idea that there is only one legitimate government for China, an idea known as the “one China” policy. Although other Qian comments appeared to cast some doubt on the sincerity of his remarks, senior Taiwanese officials remained cautiously upbeat.

“We consider this as a time when both sides are building momentum,” said Tsai Ing-wen, chairwoman of Taiwan’s Mainland Affairs Council, the government body most closely involved in cross-strait ties.

Direct ties between Taiwan and mainland China would help ease tensions along one of the world’s few remaining Cold War political fault lines — one that has drawn US naval ships to the region several times.

Amid the peaceful overtures, a Pentagon report last week said that China is pursuing a defence buildup that especially threatens Taiwan. It cited the addition of short-range ballistic missiles in Fujian province, opposite Taiwan, which has no defences against such weaponry. China also has acquired Russian-made submarines, which could cut off Taiwan’s sea lanes and threaten American forces that might respond, the Pentagon said.

But the hope is that direct trade and other ties would streamline a large and growing indirect commercial relationship between Taiwan and mainland China that has developed over the past two decades despite the political tensions. There has been no direct trade across the strait since China’s Nationalist Party leader, Chiang Kai-shek, retreated with his supporters to Taiwan in 1949 after losing a bitter civil war to the Communists.

Beijing broke off most unofficial contacts with Taiwan three years ago after the island’s then-president, Lee Teng-hui, said that ties between Taipei and Beijing should be like those between two states.

Few of those following events believe negotiations for direct links would be either quick or easy. Many talk of a process that could take years to complete. Still, several factors fuel a guarded optimism that a start may be possible.

Among them: Direct ties carry potentially strong benefits for both sides, political analysts believe.

For Beijing, they would bind the island democracy more closely to the mainland’s huge market. They would also likely boost Taiwan’s already considerable contribution to the mainland’s industrial growth.

Last year, indirect trade between China and Taiwan totalled nearly $28 billion, while Taiwan’s cumulative investment in mainland China now tops $50 billion, according to statistics from Beijing.

For Taiwan, dealing with these investments directly rather than via circuitous routes would cut operating costs substantially. A Taipei executive, who today requires a full day to reach his plant in Shanghai because he must fly via Hong Kong, would cut his travel time to 90 minutes on a direct flight.

Direct links would also make Taiwan far more attractive to foreign investors looking for a base for their greater China operations, business executives argue.—Dawn/The LAT/WP News Service.