In this period Taiwan not only developed the foundation of its mainland policy but also opened up its labour market through recruiting foreign guest workers. During the first part of this period, the governments on both sides of the Taiwan strait engaged in frequent political interaction with positive sentiments despite the unresolved issue of Taiwan’s political status. Several rounds of direct negotiations between the SEF and the ARATS were organised, which reached its peak in the historical talk between two chairmen (known as the Koo-Wang or Wang-Koo talk) in April 1993 in Singapore, the highest level official talk up to date. In the second part of this period, however, the relation went downhill rapidly, ending with China’s military and verbal attacks against Taiwan in 1995 and 1996 (known as the 1995-1996 crisis).
The first official negotiation between the SEF and the ARATS was held at the end of 1991, followed by five rounds of talks prior to the Koo-Wang talks in 1993. All through these six rounds of negotiations, the PRC government was more interested in finding a political solution towards unification, yet the ROC government consistently defined the negotiation as technical rather than political. The first three rounds were fruitless because both parties could not reach an agreement on the agenda. Eventually, both parties agreed not to insist on the definition of “one-China” in the written document.259 The following two talks focused on finalising the details of these two issues and preparing for the meeting of the respective chairmen. During the Koo- Wang talks, a joint statement and three agreements on the formalisation of future exchanges and contacts, document verification, and registered mail were signed.260
259
The third round talk which took place in October 1991 in Hong Kong, was referred to as the “92 consensus”. It was during this talk that both parties acknowledged that although both parties agreed on the “one-China” principle, it was impossible to concur on what “one-China” meant. Several versions of expression were proposed by both parties yet none was agreed upon. After this talk, through postal communications, the SEF and the ARATS agreed not to include the expression of “one-China” in the discussed agreements (regarding documents verification and registered mails) and allowed both parties to “verbally” interpret the meaning of “one-China” (gezi biaoshu 各自表述). However, in 2004 the political leaders of both sides somehow had a very different interpretation on what actually had happened in 1992 and denied that a consensus was reached, which triggered another controversial debate (Zhao, 1999).
260 The joint statement also mapped the future agenda of cross-strait negotiations that included 1) fight
Despite the necessary strategies of taking tough positions and staging theatrical performances, the negotiations were carried out with optimism. Both parties were willing to compromise and to postpone the political agenda and focus on social and economic issues as a starting point for reunification. For the PRC leadership, the strategy of promoting cross-strait trade that would lead to eventual reunification was laid out and publicly announced as early as 1990.261 Taiwanese leaders, on the other hand, had always defined these negotiations as “people-to-people talks”.262 In the midst of the rounds of negotiations, in spite of a basic attitude of pragmatism and compromise, the respective governments continued to issue statements regarding their interpretations of the “one-China” principle that antagonised the counterpart and triggered counter-statements. Actions of Taiwanese leaders in seeking international recognition263 and China’s warnings reached such a point that the on-going negotiations nearly collapsed. On Chinese New Year eve, 1995, Jiang Zemin, President of the PRC, officially condemned any attempt or rhetoric of “Taiwanese Independence” and defined the one-China principle, as well as stressed the necessity of employing military force to defend the integrity of China’s sovereignty against foreign power.264 Lee Teng-hui, President of the ROC, made a counter-speech and proposed to resolve cross-strait problems within an international framework. By allowing both entities to join international organisations on equal footing, the cross-
resource development; and 4) cultural and scientific exchanges. Memo of future collaboration, the SEF and ARATS, 1993.
261
In a speech during the National Work Conference on Taiwan in 1990, the PRC President Yang Shangkun stated, “We should promote political integration through the economy, compel the Taiwan authorities to talk with us by manipulating Taiwan people’s opinion and lead exchanges between the two sides in a direction favourable to the reunification of the mother land”, quoted by Zhao (1999:27). The original source he drew was from the China Times, 14 April 1991, p.1.
262
The Guidelines designs a process of three phases geared toward unification. The goal of the first and short term is to achieve exchanges and reciprocity, more particularly, to “gradually ease various restrictions and expand people-to-people contacts so as to promote the social prosperity of both sides (Guidelines for National Unification, IV. Process, 1. Short term, article 2; Mainland Affairs Council, ROC).
263
Scholars attribute Taiwan’s campaign to reenter the United Nations as the first event and a major factor causing the political divergence. In early 1993, at the peak of the preparations for the Koo-Wang talks, the Foreign Ministry of the ROC issues a white paper on the foreign policy, which states that Taiwan identifies reentering the United Nations as the major objective of its foreign policy, which should be achieved based on the principle of ”one-China, two entities” formula. The PRC responded by issuing a series of harsh criticisms and warnings, among which the white paper on the Taiwan Issue and China’s Unification in September 1993 (Chen, Qimao 1999:129). President Lee Teng-hui and Premier Lien Chan made intensive, unofficial visits to Southeast Asian countries in 1993 and 1994. These visits were called “vacation diplomacy” that the President and Premier visited these countries in the name of private vacations, but informal meetings with the political and opinion leaders of these countries were arranged (Chen, Qimao, 1999).
264
President Jiang Zemin’s Chinese New Year Eve address, entitled “Continue struggle for the completion of unification of the fatherland (為促進祖國統一大業的完成而繼續奮鬥) in January 30, 1995. Full text of the speech in Chinese see the Renmin Daily, January 31, 1995. This speech is commonly known as Jiang’s eight point speech. Summary of the eight points, both in Chinese and English, see Dalugongzhuo cankaoziliao (compilation of reference materials for Mainland Affairs), No. 7428-3, 1996, pp.151-154.
strait differences would automatically diminish.265 Lee’s proposal was not acceptable for the PRC leaders. The tension amounted to the highest point when Lee visited the USA in May 1995. In summer 1995, China launched a series of verbal threats and military exercises, which lasted until March 1996 before Taiwan’s presidential election, in which to China’s disappointment, Lee was re-elected. Cross-strait negotiations are on hold since then.
In the midst of political divergence and hostility, the cross-strait economic exchange continued to grow rapidly and as a result, Taiwan’s economic dependence on Mainland China grew as well.266 Taiwan’s economic dependence on China had caused concerns for Taiwanese political leaders. Thus measures such as applying stricter financial regulations to the companies investing in mainland China and inserting a ceiling of mainland investment in proportion to domestic investment etc. were imposed on Taiwanese companies.267 However, these regulatory measures and policy dis/incentives were either ineffective or irrelevant. The Taiwanese government was only relatively effective in restricting the inbound flows of the commodities, capital and people’s movement from the PRC and exerted little control over the outbound flows from Taiwan to the mainland. In fact, with the growing influence of business elites in domestic politics in Taiwan, the government often was constantly pushed to relax or abandon these measures. This explains why even in the midst of most severe political tensions in the 1995-1996 crisis, the Taiwanese government lowered the political threshold for opening up the three-links (Chu, 1999:172-3).
In the meantime, the cross-strait interaction at the people-to-people, social level had grown vigorously. Next to continuous visits and exchange between people with kin ties, tourism, cultural and scientific exchange and sex tourism had also grown rapidly. With the lack of proper policies regulating the interaction, the Taiwanese authorities lost control and tended to adopt a defensive and problem-solving mentality towards cross-strait social interaction. This is reflected in the process of mainland policy and law-making, which will be analysed in the next section. Table 3 shows the estimated volume of Taiwanese visiting Mainland China, which serves as an indication of cross-strait social interaction.
265
President Lee’s response to Jiang’s eight points, speech on April 8, 1995; known as Lee’s six point speech. Full text see http://www.mac.gov.tw/big5/rpir/2nd1_3.htm (text included in Appendix 2).
266
A large amount of literature focuses on the scale and impact of cross-strait economic integration, the factors why the PRC is the preferred choice for Taiwanese businessmen, and the incentives that the PRC offered specifically toward Taiwanese business elites. See, for example, Chu (1999:172-3); Zhao (ed., 1999) One of the investment incentives specially attracting Taiwanese businessmen is the “Protection of Taiwanese compatriots’ Investment Law” issued by the National People’s Congress in March 1994. For in-depth analysis of Taiwan and China’s mutual economic dependency, see Steinfield (2005).
267
Table 11 Taiwan’s trade dependency on the mainland, 1986-2004
Year Taiwan’s total trade with the mainland (a)
Taiwan’s total trade worldwide (b) Dependency Rate (a/b) 1986 1988 1990 1992 1994 1995 1999 2000 2001 2002 2003 2004 0.95 2.72 5.17 11.67 16.51 20.99 25.76 32.39 29.96 41.01 46.32 61.64 64.04 110.34 121.93 153.48 176.99 215.20 232.27 228.32 234.28 248.55 278.60 351.11 1.49% 2.47% 4.23% 7.60% 9.38% 9.75% 11.1% 11.2% 13% 16.9% 17.1% 18% Unit: billion US Dollars; source: various sources268
In addition, the direct experience of people-to-people’s social interaction has not always been positive. One example was the “thousand-island lake incidence”, where hundreds of Taiwanese tourists were robbed and killed by Chinese criminal gangs on a tourist boat cruising in a tourist location in Southern China in March 1994.269 This event substantively altered the Taiwanese people’s perception of China. Opinion polls indicated that after this event, the percentage of Taiwanese people considering themselves Chinese had dropped considerably.270
268
The figures 1985-1995 cited by Zhao (1999:28) from various source. The figures 1996-2004 are from Bureau of Foreign Trade, Ministry of Economics, ROC, in Taiwan Statistical Year Book, the Council for Economic Planning and Development, 2005:203. These figures are based on estimation as there is no direct trade between Taiwan and mainland China. For more detailed and comparative figures compiled by custom authorities in the PRC, Hong Kong and Taiwan, see Qi (1998:11). Figures of Taiwan’s “Foreign” Direct Investment in various industries and sections, see Steinfield (2005:233, 238).
269
The China Times, March 10 and 11, 1994.
270
According to an opinion polls conducted by National Taiwan University in 1991, 1992, 1993, 1996 and 1999, opinion in favour of Taiwan’s independence (33%) and Taiwanese identity (41%) increases drastically after the thousand-lake incidence. 70% of the interviewees think that this event deeply hurt Taiwanese people’s feeling to mainland China; 57% think China is hostile to Taiwan (Lin, 2002:283, 294, 308-9).
Table 12 Number of Taiwanese people visiting the PRC, with two statistics of ROC and PRC authorities
Year Number permitted by Immigration Bureau, ROC. (*)
Number estimated by National Tourist Bureau, the PRC. (#) 1988 1990 1992 1994 1996 1998 2000 2002 2004 236,839 60,001 6,965 433,660 97,294 134,805 511,809 712,703 75,626 541,000 948,000 1,317,770 1,390,215 1,733,897 2,174,602 3,108,677 3,660,600 3,685,300 Source: The Straits Exchange Foundation, ROC271
3.3.2 Domestic politics of the making of the Act Governing Relations between