U.S. - Taiwan Relations: Building on Success, Address by Darryl N. Johnson, Director, American Institute in Taiwan, 22nd Annual Joint Business Conference US-ROC (Taiwan) and ROC-USA Business Councils, Taipei International Convention Center, Taipei, Taiwan

BG9822E | Date: 1998-11-17

It is a special pleasure for me to appear before this distinguished group today at the beginning of this important two-day conference which will include the participation of President Lee Teng-hui, Premier Vincent Siew and other Taiwan leaders, and of U.S. Secretary of Energy Bill Richardson, Senators Frank Murkowski, Jay Rockefeller and Robert Torricelli and Congressman Pete Sessions. I would also like to pay special tribute to the work of those who brought all of us together here, Judge William Clarke and David Laux on the U.S. side, Ambassador Jeffrey Koo and Dick Moe on the Taiwan side. More important than high officials and organizers, however, are the business people on both sides of the Pacific who make the critical decisions every day to bring vitality to the U.S.-Taiwan business relationship.

In July of this year, Forbes Magazine carried an article about the 400 richest people in America. Featured on the cover was a young man named Jerry Yang (Yang Chih-yuan). Twenty-nine-year-old Mr. Yang is the iconoclastic founder of the Internet gateway server Yahoo! He emigrated from Taiwan to the U.S. just ten years ago, and his personal net worth is now nearly US$1 billion. Another example from Forbes Magazine: last year they named Morris Chang (Chang Chung-mo) of Taiwan Semiconductor Manufacturing Corporation one of the top 25 CEOs in the world, and the only one in Asia. Now that's a pretty select group. Mr. Chang got his university education in the United States -- Harvard, MIT, and Stanford. After receiving his Ph.D. from Stanford, he worked for a number of years at Texas Instruments in the United States. But eventually he returned to Taiwan, where he has become one of the world's most dynamic business leaders in an industry known for its dynamism. And not coincidentally, the early success of his company was partly the result of enlightened government policies here that encouraged the development of innovative technology.

Morris Chang, Jerry Yang, and many others in the high-tech halls of Silicon Valley and Hsin-chu have changed the way we all look at the world. And it was educational exchanges between the U.S. and Taiwan that made their success possible, in part. In the beginning, however, way back in the 1950s and '60s, many in Taiwan predicted that allowing students to go abroad would result in an irreversible brain drain. And at first their fears seemed to have merit. But, in recent years the brain drain has disappeared. Now it's more like a brain exchange, with students and professors and business people moving back and forth across the Pacific, at home on either shore, contributing to the success of both societies. Higher education remains one of America's most important "exports" to Taiwan, and to the rest of the world.

Our economic and educational cooperation has helped to spark a transformation of society here in Taiwan. But none of these changes could have taken place without political stability and a secure environment. Absent a strong relationship between our peoples, Taiwan would be a completely different political, economic, and social entity than it is today. By enhancing Taiwan's ability to defend itself, the United States has helped to create a stable, peaceful environment in which the island could develop. And in this stable environment Taiwan's economic and political evolution over the past 30 years has been extraordinary.

In this context, I would like to pay special tribute to the leadership and vision of President Lee Teng-hui. He has played a key role in the establishment of democracy on Taiwan. Of course, the credit for the success of Taiwan's democratization belongs not only to him, but also to thousands of other leaders here on the island, and especially to the people who have seized the opportunity to participate in the choice of their leaders and policies. The United States also played at least a peripheral role in this process. We did so by supporting a stable international environment, as I just noted, and by offering up examples of how a democratic system might work.

In recent years, some critics in the region have said that democracy is not compatible with Asian values or with early-stage economic development. Taiwan's example gives the lie to that notion. Democracy may be different in each country. But there is no reason why Indians, Chinese, Japanese, Russians, or Americans need a king or an emperor or a dictator to tell them how to live their lives. Look around yourself here in Taipei this week: you will see banners and sound trucks all over as people gear up for major elections in December. Latest estimates predict that at least 75% of the electorate will come to the polls (I wish we could do nearly as well in the United States). The process is loud and somewhat chaotic and not always polite. But the essential point is that democracy has established deep roots in Taiwan in just over ten years, and the tree is remarkably healthy. I say, Bravo Taiwan!

The relationship between the United States and Taiwan, while unofficial, is rich and deep and long-standing. It is based upon a firm foundation. Let me recite for you the main elements of that foundation as formulated by my colleague, Dr. Richard Bush, the Managing Director of AIT's Washington Office. Dr. Bush made these comments during a speech at Arizona State University earlier this year, marking the upcoming 20th anniversary of the Taiwan Relations Act.

* The United States adheres to a one-China policy;

* the basic elements of our policy are articulated in the three U.S.-PRC communiques and the
Taiwan Relations Act (TRA);

* we insist that the Taiwan issue be resolved peacefully, and, to that end, we encourage a
constructive cross-Strait dialogue;

* the United States abides by a number of long-standing policy statements that are corollaries of
our one-China policy. We do not, for example, support Taiwan independence; and we will not
seek to mediate the cross-Strait dispute nor pressure Taiwan into negotiations;

* Pursuant to the TRA, we will carefully consider Taiwan's requests for defense articles and
services. We want to do more than sell expensive weapons systems; we hope to provide
hardware and software to create military capabilities, thus ensuring that Taiwan has the ability to
defend itself.

These principles form the bedrock of our relationship with Taiwan and with the PRC. They represent a China policy that has remained consistent over the past 25 years, regardless of who was sitting in the White House. I want to emphasize this point because last summer, following President Clinton's visit to China, there was some misunderstanding in this regard. You of course remember the newspaper stories about the so-called "three no's;" that is, no support for Taiwan independence, or for two-Chinas or one-Taiwan/one-China, or for Taiwan's membership in international organizations that require statehood for membership. Many commentators here and in the United States saw in the President's words a departure from previous U.S. policy.

Let me pass on something that should be no secret: the statement of the three no's did not constitute a new or different U.S. policy -- U.S. policy toward Taiwan has not changed, and the public record on this point is clear. There was one element that was new, however: this was the first time a U.S. President had stated these principles in a public forum on Chinese soil. It is also worth noting in this context something else that was overlooked by some: President Clinton was also the first U.S. President to reiterate our commitment to the Taiwan Relations Act on PRC soil.

In addition, while answering questions at Beijing University, Mr. Clinton clearly set out the basis for our continued arms sales to Taiwan; namely, that the United States does not believe these sales are an obstacle to better cross-Strait relations. On the contrary, we believe they are an essential part of helping to create a fair and balanced atmosphere, an atmosphere in which the two sides of the Taiwan Strait can find a peaceful, mutually satisfactory resolution to their differences.

In this regard, the U.S. was very pleased with the recent visit of Mr. Koo Chen-fu to Shanghai and Beijing. We have no illusions that long-standing differences can be mended through a few gentlemanly conversations. But we are pleased that contacts at high levels have resumed. I should hasten to repeat a point I made earlier. The United States will not serve as a mediator in this dispute. We do not have a preferred resolution to the problem. We ask only that any resolution be agreed upon mutually and arrived at peacefully.

Another issue much on the minds of U.S. and Taiwan leaders involves Taiwan's accession to the World Trade Organization (WTO). One of our major achievements since the time of your last meeting was the conclusion in February of this year of our bilateral negotiations on Taiwan's accession. This was a win-win outcome. WTO membership will bring major benefits to consumers in Taiwan and the United States. It will significantly improve market access for American manufacturers, farmers, and service providers.

Taiwan's entrepreneurs will also profit, for the globalization and liberalization required by WTO will help them to preserve and strengthen their international competitiveness. And finally, the WTO itself will come out on top. After all, Taiwan is the world's 14th-largest trading power; the WTO can only be stronger with Taiwan as a member.

Taiwan is now in the final stages of the WTO accession process. It still has a few bilateral negotiations to complete, and the multilateral process is already under way. The end is in sight. The United States is committed to supporting Taiwan's application solely on its commercial merits, not on political grounds. The same is true for the PRC's application. We favor Beijing's accession on commercially viable terms. Of course, the WTO operates as a consensus organization. If Taiwan is to join the WTO, then it must persuade the members of the merits of its application.

This has been a short review of the state of the multi-faceted, albeit unofficial, relationship between Taiwan and the United States. My diagnosis is that the patient is in excellent health -- there is no need for special treatment; we should just keep doing what we have been doing, only more so. This excellent state of health is a tribute to the authors of the Taiwan Relations Act and, if I may say so, to the men and women of AIT and CCNAA-TECRO, the organizations established to make our unofficial relations work. When the TRA was enacted almost 20 years ago, the future was unknown and unknowable. The TRA was a unique document governing a unique relationship for which there was no precedent in history. Would it work? It did. It does. It will. The last 20 years of experience in a complex, nuanced, unparalleled relationship represent a remarkable success story, with many more chapters yet to come.