Remarks by Dr. Richard C. Bush, Chairman and Managing Director, American Institute in Taiwan, at the Conference on "U.S.-Taiwan Relations: Current Issues and Developments" Sponsored by the Center for Strategic and International Studies May 20, 1998

BG9817E | Date: 1998-07-16

The United States relationship with Taiwan, guided by the Taiwan Relations Act and the three communiqués between the United States and the People's Republic of China, is robust yet unofficial.

Because it is both successful and unofficial, the relationship does not always get the sort of press or public attention that it deserves. A conference like this, featuring distinguished speakers from Taiwan, permits an in-depth discussion of the dense web of ties that bind the American people to the people on Taiwan and how the bonds between us might further be strengthened.

Let me note for the record that the island of Taiwan, which is about the size of Massachusetts and Connecticut combined and a little more than double their population, is the United States'

7th largest trading partner; 7th largest export market (50% larger than the PRC); 4th largest source of foreign students (tied with India); 2nd largest source on non-immigrant visas.

For Taiwan, the United States is the largest trading partner and export market; the second source of foreign investment just behind Japan; the almost exclusive source of defense articles and services; and its principal source of security.

To give you some sense of the vibrancy of our unofficial relationship with Taiwan, let me mention some of the things that have happened in the last year:

the deputy governor of Taiwan's central bank was in Washington in late April for a variety of meetings on the Asian financial crisis; Minister of State George Yang led a delegation for the ground-breaking of a creative aerospace joint venture between Taiwan and West Virginia companies, and held substantive meetings in Washington on air safety and telecommunications policy, both important current issues in Taiwan; Vice President Lien Chan and a high-level delegation transited the United States on the way to and from the inauguration of the president of Costa Rica; in Geneva, the Taiwan working party met to consider the island's application to join the World Trade Organization; and Chairman Ku and Director Chen are here for today's conference.

I want to emphasize Taiwan's application to the WTO. In February, the United States and Taiwan passed a major milestone towards the island's accession to the WTO by concluding bilateral negotiations on issues of major concern to the United States. This was a win-win outcome for both sides. It will bring major benefits for consumers in the United States and Taiwan, and improve market access for American manufacturers, farmers, and service providers. The globalization and liberalization that the WTO fosters will help Taiwan entrepreneurs seek to preserve their economic competitiveness. And, because Taiwan is the world's fourteenth largest economy and a major global trader, the WTO will benefit from Taiwan's full participation.

There were some that believed that Washington, for political reasons, would hold up our bilateral negotiations on Taiwan's accession to the WTO until the PRC was further along. The agreement in February was confirmation of the commitment of two Administrations that the United States would address Taiwan's accession offer solely on its commercial merits. Steady progress had been made during the sixteen earlier rounds of negotiations, and Washington was ready to complete negotiations when early this year Taipei signaled that it was prepared to put on the table constructive offers on the most difficult issues.

So the U.S. relationship with Taiwan, while unofficial, in substance continues to be robust. I am aware that some in Taiwan worry that our ties will suffer as the United States improves its relationship with China and that President Clinton may sacrifice Taiwan's interests when he visits Beijing next month. Based on my understanding of the Administration's policy, those fears are completely and totally unfounded. As confirmation of that view, let me cite the authoritative statements of Stanley Roth, Assistant Secretary of State for East Asian and Pacific Affairs before the Senate Foreign Relations Committee just last Thursday:

"Let me take this opportunity to categorically deny that progress at the summit will be achieved at Taiwan's expense. Despite widespread rumors to the contrary, there will be no 'fourth communiqu? regarding Taiwan arms sales. [On the same day, Assistant Secretary Roth also said: "Let me say categorically there won't be a fourth communiqu?on any Taiwan issue."]

Our position regarding Taiwan is clear and unchanged. We remain committed to our unofficial relationship with Taiwan in accordance with the three US-PRC communiqu廥 and the Taiwan Relations Act, and continue to support the peaceful resolution of the Taiwan issue. Our efforts to strengthen peace and stability in East Asia will benefit the region as a whole, including Taiwan.

The Clinton Administration's approach concerning Taiwan, which will not change as a result of the Beijing summit, is consistent with that followed by previous Administrations, both Republican and Democratic. It consist of several elements:

Our abiding interest is in a peaceful resolution of the relationship between Taipei and Beijing through the direct interaction of the two parties. The United States seeks to foster an environment that facilitates a peaceful resolution and reduces the potential for conflict. Specifically, the record shows that tensions across the Taiwan Strait are lowest when U.S.-China relations are strong. We continue to encourage both sides to resume dialogue and to avoid actions that might be misinterpreted by the other. In that regard, we are pleased at recent steps by Beijing and Taipei towards a resumption of the dialogue.

Pursuant to the Taiwan Relations Act, the Administration will provide Taiwan with defense articles and services "as may be necessary to enable Taiwan to maintain a sufficient self-defense capability."