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Remarks by AIT Director Stephen M. Young to the 2008 Hsieh Nien Fan of the American Chamber of Commerce in Taipei April 29, 2008

OT0805E | Date: 2008-04-29

President-elect Ma, Chairwoman Tung, distinguished guests, it is an honor for me to join you once again to commemorate a truly eventful year. As we take stock of what was accomplished during the year of the pig, we also look ahead to a new year that I believe will bring historic milestones to Taiwan.

Certainly, among the most important of these milestones are the recent elections of a new President and Vice President and a new Legislative Yuan. As one who has seen first-hand so many changes in Taiwan, I have to say that I feel fortunate to have been present when Taiwan reaffirmed its strong commitment to democracy by holding elections that my country and friends of democracy around the world have all hailed as free and fair.

What will the future hold? How will Taiwan deal with the challenges it faces, particularly the pressures of dynamic global economic change? What role will Taiwan's supporters have in helping the people of this island achieve their aspirations for the future? These are questions I would like to consider tonight.

First, in my view, an important part of Taiwan's future has already been determined by the proven continuity of its democracy. That the consolidation of Taiwan's democracy in recent elections has been peaceful and orderly, with impressive voter turnout and acceptance of the results by all sides, is a tribute to the wisdom of Taiwan's people. In President Bush's words, "Taiwan is a beacon of democracy to Asia and the world."

Second, I believe it is important to acknowledge that we live in an uncertain world, where stability and progress cannot be taken for granted. The current slowing of the U.S. economy and resulting global reverberations are a reminder that prosperity requires careful stewardship, and that interdependence is the reality of our world today.

However, I also believe that entrepreneurship and economic dynamism will find ways to blunt the impact of the current downturn. In the midst of uncertainty, far-sighted, creative businesses and individuals will seize on opportunities to forge future growth.

Taiwan has historically been resilient in the face of global economic turbulence due to its vital, flexible, and dynamic economic system. Your business community continuously finds innovative ways to keep ahead in regional and global economic competition. I've always found the people of Taiwan to be adept at coming up with cutting-edge solutions to economic challenges. The stunning success of this island's semiconductor industry is a perfect example. Like President-elect Ma, I believe that Taiwan's future economic growth will depend on deregulation and liberalization. By inviting competition, you will create the kind of business environment where continual improvement in performance is the key to companies' success. Such an environment will attract even more investment and pave the way for Taiwan to become a regional business hub.

The U.S. and foreign business community in Taiwan, including the members of the American Chamber of Commerce, are well aware of this island's nimbleness and determination in dealing with tough competition. U.S. and other foreign businesses that have already jumped into this vibrant market can serve as mentors and guides for a new wave of investors showing interest in Taiwan.

Which brings me to the third of the questions I posed earlier, namely how can those who support Taiwan assist its people to realize their hopes and goals for the future?

There should be no question that the U.S.-Taiwan relationship will continue to flourish. Our ties, which are both strong and complex, will deepen and broaden as this place demonstrates to the region and the world the power of democracy and free market economic dynamism. Both Taiwan and the U.S. have a vital stake in continuing to build our economic ties and sustaining mutual prosperity. Our collaboration extends to the Asia-Pacific Economic Cooperation (APEC) forum where we are working towards greater regional economic integration and exploring the possibility of a Free Trade Area of the Asia Pacific as a long-term prospect. Through a range of capacity building initiatives the U.S. and Taiwan are working together to reduce trade and investment transaction costs and facilitate the movement of businesspeople.

In the interest of brevity, the highlighted portion (below) will not be read at the April 29, 2008, "Hsieh Nien Fan," but should nevertheless stand as part of this speech for the record.

The U.S. -Taiwan relationship is also enhanced by sharing our respective expertise in numerous areas of science, health, technology, and regional security. Although the economic benefit of this cooperation for our two peoples may not be easy to measure in dollars or Taibi, the importance to our relationship of these areas of cooperation is well understood by both sides. I'd like to touch on a few examples.

One area of cooperation is preventing the proliferation of goods and technologies that could be used to develop Weapons of Mass Destruction (WMD) and the systems to deliver such weapons. Taiwan's diligence in this endeavor has been significant. Joint collaboration has enhanced Taiwan's strategic trade control system through exchanges and training on legal, licensing, enforcement capabilities, and outreach to industry, under the auspices of the Export Control and Related Border Security (EXBS) program.

Additionally, since 2004, we have been working together to strengthen security in the ports of Kaohsiung and Keelung through the Container Security Initiative. As one of our partners in this important global initiative, Taiwan is helping to enhance the safety of sea cargo transiting Asia, prevent smuggling of drugs and counterfeit currency, and reduce violations of intellectual property rights, with undeniable economic benefit for the region.

Another noteworthy example is the Megaports initiative to prevent the smuggling of nuclear or radioactive materials. Since 2006, we have been cooperating to increase the security of a critical part of the global supply chain, clear proof of Taiwan's commitment to countering international terror threats.

Some of the most active cooperation between us is in the scientific realm, in basic research, although unfortunately some of these initiatives don't receive the publicity they deserve. For example, Taiwan's National Science Council is collaborating with the U.S. National Science Foundation, under the auspices of the AIT-TECRO framework, to build telescopes for the Atacama array of fifty telescopes that will have ten times the resolution of the Hubble. When complete, it will provide a testing ground for some of the most fundamental questions in science, such as the origin of stars, galaxies, and the universe itself. Also, our leading scientific institutions are working to integrate Taiwan into the worldwide internet of scientific databases known as Pragma.

The U.S.-Taiwan relationship is broad and multi-faceted, but tonight let me highlight trade, where it is especially strong. Taiwan is the United States' ninth largest trading partner, with exports to the U.S. exceeding $32 billion in 2007. Nonetheless, we are working hard to make our trade relationship even more vital. The Trade and Investment Framework Agreement, or TIFA, is the most effective channel for this purpose, and we expect the next session of this forum to meet in Taipei this summer, where we will continue to explore ways to expand bilateral market access and investment opportunities.

We also hope this year will see rapid progress in opening Taiwan's market to the full range of U.S. beef products and finalizing standards for pork imports based on international guidelines and practice. Both sides have expended a great deal of effort to find common ground on these trade issues in the best interests of the people of Taiwan, who represent our sixth largest export market for U.S. food and agricultural products.

You know -- like me -- that noted writer Thomas Friedman has long been a big fan of Taiwan. Friedman wrote in his book The Lexus and the Olive Tree that the economies "...that have been the most open to globalization, like Taiwan…, have achieved standards of living comparable to those in America and Japan, while the ranks of the middle class in countries like Thailand, Brazil, India and Korea have swelled, due partly to globalization." I doubt that anyone here tonight would deny that globalization confronts all economies with ever fiercer competition, but to me, what Friedman is saying is that global economic dynamics, if properly understood and embraced, can create a significant force for positive change.

I am confident that Taiwan and the U.S. will both continue to find creative ways to meet the rapidly changing requirements of the global marketplace and to bring greater prosperity to future generations. Both of us face similar challenges from globalization, yet remain committed to open economic systems in which transparency and respect for the rule of law ensure fair conditions for business competition.

Our bilateral TIFA process will play an important role, providing a platform to address existing trade concerns as well as a way to make further progress towards even greater opening up of trade in the future.

I know that many here favor a U.S.-Taiwan Free Trade Agreement. While such an agreement may be achievable in the long term, I would again urge that we stay focused on what we can accomplish in the near future. The TIFA process affords us the best mechanism to bring about needed liberalization of trade between our economies, so let us make the most of the opportunity we have in front of us now.

America looks forward to working with the Ma Administration on a whole range of important issues. We applaud both sides of the Strait for facilitating Vice President-elect Vincent Siew's recent participation in the Boao Forum, during which he held a highly symbolic meeting with PRC President Hu Jintao. My country has long championed closer economic and trade relations between the two sides of the Taiwan Strait. We hope direct links will also soon be established, and that they will be accessible to overseas passengers and carriers too.

I applaud President-elect Ma's recognition of the importance of pursuing the recommendations in AmCham's recent White Papers, and encourage continued close administration cooperation with our business community here in Taiwan.

We also expect our traditional close security cooperation to continue, as we are convinced American support for Taiwan's defense gives its democratic leaders the confidence to explore closer ties with its big neighbor without fear of pressure or coercion.

Finally, the warm personal ties between our two peoples continue to be the cement of one of our best and most enduring relationships anywhere. We are confident that under President Ma these ties will only grow stronger.

In conclusion, I'd like to note that, as the people of Taiwan look to the future, they can count on the steadfast support of the United States. Taiwan has so much to offer the world in many areas, including economic development, health and medical care, high technology, and democratization. Taiwan is simply too important for the international community to ignore, and the U.S. will do its part to make the world aware of how Taiwan can contribute to the welfare of the international community. The U.S. is committed to ensuring Taiwan's meaningful participation in the activities of international organizations, even in those in which membership is not feasible.

I am grateful that I have been able to play a small role in the forging of lasting ties between the people of Taiwan and the United States, and I look forward to working with the Ma administration to advance the interests of both our peoples. Given what this beautiful island has already accomplished, I am confident there is no future challenge that cannot be overcome, drawing on the legendary talent and energy of the people of Taiwan.

Thank you ladies and gentlemen.

Director's Speeches