VZCZCXYZ0015
RR RUEHWEB

DE RUEHIN #1523/01 1862250
ZNR UUUUU ZZH
R 052250Z JUL 07
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC 5893
INFO RUEHBJ/AMEMBASSY BEIJING 6999
RUEHHK/AMCONSUL HONG KONG 8246

UNCLAS AIT TAIPEI 001523 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT FOR INR/R/MR, EAP/TC, EAP/PA, EAP/PD - BROOKE SPELLMAN 
DEPARTMENT PASS AIT/WASHINGTON 
 
E.O. 12958: N/A 
TAGS: OPRC KMDR KPAO TW
SUBJECT: MEDIA REACTION: U.S.-CHINA-TAIWAN RELATIONS; CROSS-STRAIT 
RELATIONS 
 
 
Summary:  Taiwan's major Chinese-language dailies focused news 
coverage July 4-5 on the Executive Yuan's decision on Wednesday to 
revoke the National Communication Commission's (NCC) approval of the 
sale of the Broadcasting Corporation of China to former [pan-Blue] 
Legislator Jaw Shaw-kang.  The other focus is a seven-year high that 
TAIEX reached on Wednesday by passing the 9000-point mark. 
 
In terms of editorials and commentaries, Commentator Frank Ching 
said in the pro-status quo, English-language "China Post" that 
President Chen Shui-bian's intention to push for holding a 
referendum on joining the United Nations under the name Taiwan has 
anything to do with the upcoming legislative election and 
presidential election in early 2008.  Commentator Michael Lin opined 
in the pro-independence, English-language "Taipei Times" that 
cross-Strait economic integration is not an inevitable trend, 
because a majority of Taiwanese believe that Taiwan's economy has 
already been hurt by overheated cross-Strait trade, and because 
China's economy is not as good as it seems.  End summary. 
 
¶1.  U.S.-China-Taiwan Relations 
 
"China and U.S. Close Ranks on Taiwan" 
 
Commentator Frank Ching said in the pro-status quo, English-language 
"China Post" [circulation: 30,000] (07/04): 
 
"China and the United States have closed ranks in opposing the 
latest antic by Taiwan's leader Chen Shui-bian: to hold a referendum 
on whether the people of the island agree that it should apply to 
join the United Nations using the name Taiwan. 
 
"On the surface, this does not seem like much of an issue since 
Taiwan is not going to be admitted into the United Nations anyway, 
regardless of what name it decides to use. 
 
"... The fact that any application is doomed to failure is 
irrelevant since Chen's purpose is not to join the United Nations 
but rather to work up the Taiwan population in the months leading up 
to parliamentary and presidential elections early next year. 
 
"... Past performance has shown that Mr. Chen, whenever facing an 
election, would take action to energize his political base of 
pro-independence supporters. The real significance of this 
referendum is the laying of the groundwork for a formal change in 
name from 'Republic of China' to 'Taiwan.' 
 
"... Even if the referendum does not pass, it is likely to draw 
pro-independence voters to the ballot box and thus increase the 
number of seats won by the DPP in the parliamentary elections and, 
possibly, spell the difference between victory by Frank Hsieh, the 
DPP candidate, and Ma Ying-jeou, candidate of the opposition 
Nationalist Party, or Kuomintang (KMT). 
 
"Thus, President Chen has much to gain and little to lose. Even if 
Washington is upset by his defiance, it is not in a position to do 
much in terms of penalizing him, other than by denying - or more 
likely restricting - his travel plans when he applies for a transit 
visa next month. 
 
"The reality is that Mr. Chen knows that he has the United States 
over a barrel. In spite of its official position of having no 
preference over whether Taiwan becomes independent or opts for 
unification with mainland China, it is widely assumed that 
Washington does not want to see Taiwan taken over by mainland China, 
thus increasing the power and influence of Beijing. 
 
"Besides, Chen can keep playing the democracy card and say that it 
is the right of the people of Taiwan to hold a referendum. In fact, 
he has already said that the American people, if not the State 
Department, are on his side. 
 
"... In the end, therefore, all this posturing about the United 
Nations is only meant to influence the outcome of the elections next 
year. The United States knows this too, but does not want Taiwan to 
hold the referendum simply because it knows China will be angered. 
And China is opposed because it fears not only the short-term 
electoral impact of such a move but also the long-term effect such a 
referendum will have on the sense of Taiwan identity and the 
preference of Taiwan's 23 million people for separateness rather 
than unification with the mainland." 
 
¶2.  Cross-Strait Relations 
 
"China not as Good as Future Trend Guru Claims" 
 
Commentator Michael Lin opined in the pro-independence, 
English-language "Taipei Times" [circulation: 30,000] (7/4): 
RELATIONS 
 
"In a lecture in Taiwan, future trend guru John Naisbitt one-sidedly 
praised China's economic boom, saying that cross-strait economic 
integration was an inevitable trend. However, he ignored two major 
problems. 
 
"First, more than 60 percent of Taiwanese believe that the economy 
has already been hurt by overheated cross-strait trade and will 
suffer even more severely if the trend continues. Therefore, unless 
Taiwanese are willing to be unified with China, it is practically 
impossible to integrate the two economies. 
 
 
"Second, China's economy is not as good as Naisbitt says. The book 
Fault Lines in China's Economic Terrain, published by RAND Corp, 
lists eight major problems with the Chinese economy that will 
continue to crop up over the next ten years and which will affect 
its development. Naisbitt made a point of ignoring these faults. 
 
"... Naisbitt just happened to avoid these major problems during his 
lecture and question-and-answer session. I don't know if he truly 
doesn't understand the fragile side of China's economic development, 
or if he simply chose to ignore it. But it is certain that he lacks 
a clear understanding of Taiwanese society. One must already have a 
certain 'Mind Set,' which also is the title of his latest book, to 
keep emphasizing the importance of cross-strait economic 
integration, and to so seriously misunderstand Taiwan's future 
economic 'trends.'" 
 
YOUNG