VZCZCXYZ0008
RR RUEHWEB

DE RUEHIN #0120/01 0170626
ZNR UUUUU ZZH
R 170626Z JAN 07
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC 3754
INFO RUEHBJ/AMEMBASSY BEIJING 6213
RUEHHK/AMCONSUL HONG KONG 7443

UNCLAS AIT TAIPEI 000120 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT FOR INR/R/MR, EAP/TC, EAP/PA, EAP/PD - DAVID FIRESTEIN 
DEPARTMENT PASS AIT/WASHINGTON 
 
E.O. 12958: N/A 
TAGS: OPRC KMDR KPAO TW
SUBJECT: MEDIA REACTION: CROSS-STRAIT RELATIONS, U.S.-TAIWAN 
RELATIONS 
 
 
¶1. Summary:  As Taiwan's major Chinese-language dailies continued to 
focus their coverage January 17 on the scandal-ridden Rebar Asia 
Pacific Group, of which the chairman and his wife have fled to the 
United States, news coverage also centered on the KMT's timetable 
for primaries for the 2008 presidential and 2007 legislative 
elections.  The pro-independence "Liberty Times," Taiwan's 
largest-circulation daily, ran a news story on page three that read 
"[Rebar's] Wang You-theng and his Wife Flee and Stay in the United 
States; Taiwan Decides to Pursue the Case Overseas."  The 
pro-unification "United Daily News," on the other hand, ran a banner 
headline on page two that said "Ma to Decide by March Whether to Run 
for the Presidency." 
 
¶2. In terms of editorials and commentaries, a "United Daily News" 
editorial discussed the relevance of the Second East Asian Summit, 
which was held in Cebu Monday, to the Formosa Plastics Group's "Mega 
Ethylene Complex" project.  The article said the East Asian Summit 
will only marginalize Taiwan further and thus make it more difficult 
for Taiwan businesses to "leave their roots in Taiwan."  An op-ed 
piece in the limited-circulation, pro-independence, English-language 
"Taipei Times," on the other hand, discussed the U.S.-Taiwan 
relations.  The article urged Washington to pay close attention to 
how the KMT and the DPP will do when preparing themselves for the 
legislative elections in 2007 and the presidential election in 2008. 
   End summary. 
 
¶3. Cross-Strait Relations 
 
"What Does the East Asian Summit Have to Do with Y.C. Wang [i.e. 
founder of Formosa Plastics Group]?" 
 
The pro-unification "United Daily News" [circulation: 400,000] 
editorialized (1/17): 
 
"The following two pieces of news seemed totally irrelevant to each 
other, but in reality, they echoed each in the chain of cause and 
effect:  One was the second 'ten plus six' East Asian Summit held in 
the Philippines; and the other was about the remarks by Zhang 
Xiaoqiang, a Chinese official, that the 'Mega Ethylene Complex 
Project' proposed by the Formosa Plastics Group (FPG) will 'likely' 
get a green light from China. ...  If one juxtaposes these two 
pieces of news, one can tell from the East Asian Summit that Taiwan 
will move a step closer to being marginalized; and from the FPG's 
'Mega Ethylene Complex Project,' one can tell that Taiwan's 
businesses are still awaiting the possibility to 'leave their roots 
in Taiwan.' ... 
 
"... In fact, the key crisis for Taiwan's politics and economics is 
not about whether [Taiwan businesses] will 'leave their roots in 
Taiwan,' as Taiwan is neither able to retain its resources nor able 
to usher in international resources. ...  Changes in the 
international situation, such as the 'ten plus' [East Asian Summit] 
will only make Taiwan more marginalized and further deteriorate the 
condition for Taiwan businesses to 'leave their roots in Taiwan.' 
The question that follows is:  Will Taiwan's economic dependence on 
China drop or rise after Taiwan becomes further marginalized?  The 
answer is:  it will definitely rise, because without China, Taiwan 
will find itself locked in a cul-de-sac.  ... 
 
"[The government's] cross-Strait policy over the past decade has 
been built on the ideology of [the DPP's] 'pro-independence 
platform' and the theory that 'China will go downhill.'  But a look 
at China's performance in the 'ten plus' summit alone will clearly 
indicate that China is embracing a broadening future while Taiwan is 
facing a narrowing path ahead.  The earth will not stop revolving 
just for Taiwan.  The development of the 'one plus' summit will not 
be restrained by [the DPP's] 'pro-independence platform,' and it 
even runs counter to the theory of 'China going downhill.'  As 
Taiwan gets more tilted toward mainland China, the situation will 
become more unfavorable for [Taiwan businesses] to 'leave their 
roots in Taiwan.' ..." 
 
¶4. U.S.-Taiwan Relations 
 
"The US Should Pay Close Attention" 
 
Nat Bollocchi, former AIT chairman and now a special adviser to the 
Liberty Times Group, opined in the pro-independence, 
English-language "Taipei Times" [circulation: 30,000] (1/17): 
 
"... Regarding security issues, the DPP leadership has not been able 
to establish sufficient influence to steer military defense policies 
in the direction it desires and gain the support of the public on 
security matters.  The KMT, on the other hand has deliberately 
weakened Taiwan's defense to gain political power and establish its 
own relationship with China.  The US must consider the differences 
between the two sides and the relationship not only with Taiwan but 
also with China.  In addition, the US must think about the long-term 
RELATIONS 
 
effects of its policies.  One example is US efforts to encourage 
Taiwan to increase its economic ties with China, while at the same 
time pressing Taiwan to increase its purchases of military arms and 
technology from the US. ..." 
 
YOUNG