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"Taiwan and the TRA: Past, Present and Future" by AIT Director Stephen M. Young March 27, 2009 Academia Sinica, Taipei

OT0907C | Date: 2009-03-27

Taiwan and the Taiwan Relations Act Over the Past 30 Years

Many former officials and scholars have analyzed the historical context of the Taiwan Relations Act, and I don't want to duplicate their efforts today.  However, I do want to honor Harvey Feldman, a good friend of many of us here today who passed away recently.  In his many years of service both inside and outside government, Harvey always demonstrated great understanding for the people of Taiwan as well as a sustained commitment to the ties between the U.S. and Taiwan.  As head of the State Department desk that dealt with Taiwan, he was one of the key crafters of the TRA, a unique work that reflected the combined wisdom of the Executive Branch and Congress.  In fact, I think it is a tribute to the TRA's soundness over time that so many, from President Carter to key members of Congress, have all claimed a leading role in its formulation.

Having served four assignments at AIT myself, I feel a very personal connection to the TRA and am pleased to have witnessed Taiwan's great progress and the development of U.S.-Taiwan relations over the past three decades.  The shift in U.S. diplomatic recognition from Taipei to Beijing, though not entirely unexpected, was nonetheless a considerable shock here, which is quite understandable. 

In addition to the initial confusion and uncertainty about what might be in store for U.S.-Taiwan relations, some people had concerns about Taiwan's long-term viability, given PRC pressures, Taiwan's then-authoritarian political system, and the absence of diplomatic relations with the U.S.  The TRA filled a void, making clear our lasting support for Taiwan and providing a coherent structure for the future development of our ties.  I think it is no exaggeration to say that the TRA has had a stabilizing effect, increasing the confidence of people here that Taiwan would continue to be able to shape its own future, secure in the continuing strong support of the U.S.  

Let me say just a few words about the contents of the TRA, the subject of many excellent articles and books.  Most fundamentally, the TRA provides a framework for U.S. ties with Taiwan, including the establishment of a unique entity, the American Institute in Taiwan (AIT), to conduct our relations with Taiwan.  The feature of the TRA that has attracted the greatest attention over the years (especially from Beijing) concerns the provisions regarding the U.S. interest in Taiwan's security, including our sales of defensive weapons to Taiwan.  Another important TRA provision, one which played a role in Taiwan's democratization, is the reaffirmation of U.S. support for the preservation and enhancement of the human rights of all the people of Taiwan.  

When I first began work at the newly-founded AIT in the early eighties issuing visas to travelers and students, we were still engaged in redefining our terms of reference with Taiwan.  The U.S. did not want to undercut its normalization agreement with the PRC, but was equally determined to maintain vibrant economic and people-to-people ties with Taiwan and to ensure Taiwan's continued security.  No one seemed entirely sure just exactly where all this was going, but there was determination all around to make it work. 

Even in the early years of the TRA, there was plenty of vitality in our informal ties.  In 1981 we issued over 60,000 nonimmigrant visas, of which over 5000 were for students.  Democratic rumblings were challenging Taiwan's authoritarian, one-party system, encouraged both by the forward-looking policies of Chiang Ching-kuo and the measured efforts of an emerging opposition to pry open the previously closed political system to afford them a place at the table.  These efforts were vigorously supported by American friends of Taiwan from all walks of life, from Congressmen like Lee Hamilton, Jim Leach and Steve Solarz to prominent Sinologists like Richard Bush and Jerry Cohen.  Taiwan was also emerging as an export-driven economic powerhouse, which would lead Professor Ezra Vogel to name it as one of the "four little dragons" of East Asia. 

During the 1980s and 90s, Taiwan underwent a remarkable transformation.  I was able to observe Taiwan's incredible economic transformation first-hand when I returned to Taipei in 1989-90 to study advanced Chinese at AIT's magnificent language school on Yang Ming Shan.  Economically, Taiwan continued to innovate, move up the value chain in production, and transform itself into a prosperous, advanced and high-tech economy.  To my mind, however, even more significant was Taiwan's peaceful democratic transition.  The completion of this transition was symbolized by Taiwan's first direct election for president in 1996.  Taiwan's democratization was especially impressive because the process received support from certain key leaders of the formerly authoritarian ruling party as well as from the democratic-minded opposition.

Taiwan's economic and democratic achievements earned it growing international respect.  Taiwan returned to Olympic competition in 1984, joined APEC in 1991, and began playing a more active role on the international stage. The thaw in cross-Strait relations also began during this period, culminating in the historic meeting between Koo Chen-fu and Wang Daohan in Singapore in 1993. 

U.S.-Taiwan relations also deepened during this period.  In 1992, U.S. Trade Representative Carla Hills became the first cabinet level official to visit Taiwan since the break in relations.  In 1994, the U.S. conducted a Taiwan Policy Review that expanded opportunities for economic and technical visits and meetings, and made clear U.S. support for greater international participation by Taiwan.  The same year, AIT and TECRO signed a Trade and Investment Framework Agreement (TIFA) to facilitate work on economic and trade issues.  While each U.S. administration brought its own ideas and initiatives for fleshing out the U.S.-Taiwan relationship within the framework established by the TRA, the overall trajectory was clearly positive.  Most significantly, the relationship enjoyed, and continues to enjoy, solid bipartisan support, which has ensured strong continuity through six changes of administration in the U.S.

My summary account of the 80s and 90s would be one-dimensional if I did not refer at least briefly to some of the difficulties we encountered both in bilateral relations and especially in relations with the PRC.  As is well known, Beijing has consistently objected over the years to U.S. arms sales to Taiwan, an important provision of the TRA and a key element of U.S. support for Taiwan.  In 1982, the U.S. and PRC issued a joint communiqu?that eased the immediate pressure but did not fully bridge differences over the arms sales issue.  The U.S. took care at the time to reassure Taiwan that we would adhere to our TRA commitments and all subsequent U.S. administrations have remained firm on this point.

The 1996 missile crisis was another example of our past difficulties with Beijing over its policies and actions toward Taiwan.  On the basis of the TRA, the U.S. responded very firmly, ensuring the continuity of peace and stability in the run-up to Taiwan's first direct presidential election. 

The U.S. also had some differences with Taiwan itself.  Prior to democratization, the U.S. weighed in with Taiwan on a number of human rights issues, and over the years we have also had our differences on various economic issues.  The TRA framework was essential in our being able to address and seek solutions to our bilateral differences.  

In 1998 I returned to Taiwan as Deputy Director of AIT, and I have now been here three years in my current capacity as AIT's tenth Director.  During these two assignments, I have been privileged to be a witness to two democratic transfers of political power, Sam Huntington's well-known benchmark of successful democratic consolidation.  I have also seen dramatic changes in the urban landscape that reflect Taiwan's economic prosperity.  Taipei 101, which didn't even exist in 1998, is now a familiar landmark known throughout the world.  About the only thing that hasn't changed yet is the AIT facility, the same place I worked in 1981, but even this is about to change.  Before long, we plan to break ground at the site of a new state-of-the-art AIT facility in Neihu.  This will be a tangible and fitting demonstration of America's commitment to the future of Taiwan and U.S.-Taiwan relations in the 21st century.

U.S.-Taiwan relations have seen their ups and downs over the last few years, but the framework established by the TRA, and developed by successive U.S. administrations of both parties, continues to prove fully adequate to manage our differences.  I sometimes hear suggestions that the TRA should be revised or redone in order to meet new challenges to our relations with Taiwan.  But I believe the enduring strength of the Act is that it provides a sufficiently flexible framework that it has permitted us to prudently adjust our practical undertakings over the past thirty years without revising the fundamental tenets of the TRA itself.  In fact, it is the spirit of the TRA, quoting the preamble, "authorizing the continuation of commercial, cultural, and other relations between the people of the United States and the people on Taiwan," that makes this such an effective living tool for managing our informal relations even today.

There have also been important positive developments in recent years.  Taiwan passed a key milestone in 2002 when it became a full WTO member, essential to stay competitive in today's globalized economy.  Also in 2002, AIT and TECRO signed a Mutual Legal Assistance Agreement (MLAA) that strengthened our cooperation on law enforcement issues.  Other examples include our ever deepening cooperation on export controls and on combating trafficking in persons, and the progress in intellectual property rights protection that led the U.S. to remove Taiwan from the Special 301 Watch List this January. 

Taking a broad look at the course of the past 30 years, both Taiwan and the TRA have been much more successful than could possibly have been imagined in 1979.  Taiwan has turned itself into an advanced economy and a prosperous young democracy.  U.S.-Taiwan relations have greatly expanded.  As examples, bilateral trade in both directions has grown five-fold, and AIT issued three times more nonimmigrant visas and student visas in 2007 than it did in 1981.  The fact that the strengthening of U.S.-Taiwan relations and Taiwan's successful development occurred at the same time is of course no accident.  Consistent U.S. support over the past thirty years has been an important factor in creating the stable and peaceful environment for Taiwan to develop freely and rapidly.        

U.S.-Taiwan Relations

Turning to current bilateral trends, we are pleased that we can now put aside the difficulties in U.S.-Taiwan relations that occurred in recent years and focus our attention to developing the positive elements of our ties.  The United States understands and strongly supports Taiwan's desire to play a responsible role in the international arena.  We strongly support Taiwan observer status in the World Health Assembly, which will be meeting in May.  We look forward to further progress in expanding meaningful international participation by Taiwan, which has important contributions to make in health and other areas. 

Under the TRA, the U.S. will continue to work closely to help Taiwan meet the security challenge posed by the PRC military build-up.  As Secretary Clinton emphasized during her recent trip to Asia, there has been no change in our longstanding policy on arms sales to Taiwan.  In this regard, I would like to congratulate both major parties for their bipartisan support for the defense budget and the vital work of the Ministry of National Defense.  The hardware and non-hardware military improvements contribute to maintaining peace in the Taiwan Strait and also to building the political confidence Taiwan needs to engage with the PRC.

The robustness of U.S.-Taiwan economic ties is demonstrated by our two-way trade, which hit a record $62 billion last year.  After overcoming the current global economic downturn, we expect trade to continue expanding.  The TIFA process has proven a successful tool for managing this relationship and has addressed important issues, such as intellectual property rights and pharmaceuticals.  The TIFA process is also working to expand bilateral investment access, and we look forward to building further upon these past successes under the Obama Administration. 

Agriculture is another important area of our bilateral economic relationship, with Taiwan ranking as our sixth largest market for U.S. food and agricultural exports.  We are now working closely together to resolve some impediments to imports of U.S. beef, pork, rice and other agricultural products.  Decisive action to re-open the market to all U.S. beef products based on an international (OIE) ruling and Taiwan's own exhaustive safety review would send a positive signal to the policy community in Washington about Taiwan's desire to move forward on our very full economic agenda.


Cross-Strait Relations

Cross-Strait relations are an area where Taiwan has made remarkable progress over the last year.   Cross-Strait dialogue has resumed and the two sides have reached mutually beneficial agreements on economic issues such as direct flights and shipping, and visits by mainland tour groups to Taiwan. 

The U.S. fully supports and applauds Taiwan's efforts to enhance cooperation and reduce tensions in the cross-Strait region.  We know that such discussions are not always easy, but the discussions have led to, and will continue to lead to, real benefits for both sides.  I am confident democratic Taiwan will continue the open and healthy debate about next steps in cross-Strait relations as this process continues to unfold.

We regard cross-Strait dialogue as key to improving mutual understanding and building trust.  Through dialogue, Taiwan and the PRC have an important opportunity to explore new areas of cooperation to benefit people on both sides of the Strait.  The alternative to dialogue, the politically hostile standoff we have seen at times in previous years, leads nowhere.

PRC leaders have demonstrated some flexibility on aviation and commercial issues but have remained more circumspect with regard to political and security issues.  However, the only way to truly test Beijing's flexibility is through dialogue and development of the relationship.  Some argue Taiwan should fear Beijing and avoid contact since the mainland appears to hold all the cards, ensuring that Taiwan will inevitably be the loser in any relationship.  I disagree with both the premise and the prognosis of that argument.  Given Taiwan's strong track record in economic performance and democratization, I believe Taiwan should be confident it can steer cross-Strait relations in positive directions.

Optimism about Taiwan's Future

In conclusion, let me now turn to Taiwan's current situation and future prospects.  I remain a firm optimist, despite the rhetoric we sometimes hear that Taiwan might collapse or be swallowed up by the PRC.  Based on what I have seen for myself, Taiwan society has deep underlying strengths, deriving from the creativity and energy of well-educated and hard-working people who are quite capable of shaping their own future.

Another reason for optimism is the flourishing democracy Taiwan has created, based upon an increasingly vibrant civil society, an unfettered press and consolidating rule of law.  Open political debate is an essential characteristic of democracy, and there is certainly plenty of that in Taiwan!  In the end, we believe the people will make wise decisions based on their best interests, and that ultimately democratic systems enjoy a widely recognized legitimacy that authoritarian systems lack. 

Third, the solid base of Taiwan's informal but robust relationship with the United States and other important countries means that Taiwan enjoys international access and support.  Taiwan is by no means isolated as it works to manage relations with Beijing and to participate meaningfully in the international arena. 

I'd like to close with an anecdote that takes me back to my first tour in AIT, back in 1981.  The venerable Charles T. Cross, former Consul General to Hong Kong and Ambassador to Singapore, was retiring after serving as the first Director of AIT.  He had a retirement ceremony in AIT that I attended, and began waxing nostalgic over his first assignment as a Foreign Service Officer, back in 1949.  The State Department had assigned him to the small consulate in Taipei, but as his time to depart neared, his supervisors in Washington began to have second thoughts about dispatching a first tour officer to Taiwan as the Chinese civil war was winding down and Chiang Kai-shek began pulling his defeated troops across the Strait. 

Maybe, they told young Chuck Cross in summer, 1949, it would be wiser if he sent you somewhere safer than Taipei -- say Saigon or Seoul. 

Standing before an audience of AIT employees 32 years later, Chuck, a World War II Marine veteran, pulled himself to his full height and told us what he'd said to his State Department bosses in 1949.  "I may be young and new to this business, "he said, "but I think Taiwan is going to be just fine."

Well, ladies and gentlemen, in that respect, I'm with the late Ambassador Cross as I stand before you in 2009: Taiwan is going to be just fine!

Thank you, and now I hope we can get into further discussions.