VZCZCXRO9053
OO RUEHCN RUEHGH RUEHVC
DE RUEHBJ #4328/01 3301145
ZNY CCCCC ZZH
O 251145Z NOV 08
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC IMMEDIATE 1067
INFO RUEHOO/CHINA POSTS COLLECTIVE
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHINGTON DC
RUEKJCS/JOINT STAFF WASHINGTON DC
RUEKJCS/SECDEF WASHINGTON DC
RHMFISS/CDR USPACOM HONOLULU HI

C O N F I D E N T I A L SECTION 01 OF 04 BEIJING 004328 
 
SIPDIS 
 
E.O. 12958: DECL: 11/25/2033 
TAGS: PREL PGOV APEC CH TW
SUBJECT: PRC TAIWAN WATCHERS PRAISE ARATS-SEF MEETINGS, 
COMMENT ON INTERNATIONAL SPACE, APEC 
 
REF: A. BEIJING 4199 
     ¶B. BEIJING 4153 
     ¶C. BEIJING 4085 
     ¶D. TAIPEI 1610 
     ¶E. SHANGHAI 503 
 
Classified By: Acting DCM Aubrey Carlson.  Reasons 1.4 (b) and (d). 
 
SUMMARY 
------- 
 
¶1. (C) Beijing's Taiwan watchers called Association for 
Relations Across the Taiwan Strait (ARATS) Chairman Chen 
Yunlin's November 3-7 meetings in Taipei "historic," and not 
just for superficial reasons.  They highlighted Beijing's 
significant steps, including implementing economic measures 
advantageous to Taiwan (the three links) while deferring 
political issues important to Beijing; not denying mutual 
non-denial; accepting a high-profile political figure like 
honorary KMT Chairman Lien Chan as Taiwan's APEC delegation 
head; and overlooking the rough treatment Chen and his deputy 
received from rowdy DPP crowds.  Scholars said Beijing is 
going to have to go slow on the international space question 
(beyond Lien Chan's role at APEC) until there can be "more 
consultation" between ARATS and Taiwan's Straits Exchange 
Foundation (SEF).  They said that Beijing is still worried 
about making concessions that could be exploited by a DPP 
administration were Ma to be upset in 2012.  End Summary. 
 
CHEN YUNLIN'S VISIT "A SUCCESS" 
------------------------------- 
 
¶2. (C) Beijing's Taiwan experts continue to praise the 
"success" of the visit by Association for Relations Across 
the Taiwan Strait (ARATS) President Chen Yunlin to Taipei 
November 3-7, despite the protests he encountered.  They 
praised the visit's focus on concrete achievements with 
direct benefits for the people of Taiwan.  On November 12, 
Zhu Lei (protect), a researcher at the Chinese Academy of 
Social Sciences (CASS) Institute of Taiwan Studies (ITS), 
told PolOff the visit was a "major breakthrough" akin to the 
first cross-Strait charter flights in 2003 and the 2005 
visits to the Mainland by then-KMT Chairman Lien Chan and 
People First Party Chairman James Soong.  Zhu noted that the 
agreements signed during Chen Yunlin's visit focus on issues 
that are "important to the Taiwan people," with polls showing 
80 percent of Taiwan residents support direct flights and 60 
percent support Mainland tourism.  Jia Qingguo (protect), a 
Peking University professor and member of the Chinese 
People's Political Consultative Conference (CPPCC), echoed 
this sentiment, stating to PolOff on November 12 that the 
"main purpose" of Chen Yunlin's trip was to "be nice" to the 
Taiwan people and "do things in their interest."  Despite the 
demonstrations, polls show that the Taiwan people support the 
agreements signed, Jia argued. 
 
THREE LINKS: STILL ROOM TO GROW 
------------------------------- 
 
¶3. (C) In comments carried in the official Chinese media, 
Taiwan Affairs Office (TAO) Director Wang Yi stated on 
November 16 that the long-sought "three links" between the 
Mainland and Taiwan have been "basically realized."   Zhou 
Zhihuai (protect), Secretary General of the National Society 
for Taiwan Studies, emphasized to PolOff November 17 that 
Wang Yi chose his words carefully, stating that the links 
have only "basically" been achieved, given that interaction 
between the two sides is not yet "completely normal."  For 
example, the cross-Strait flights are still charters rather 
than regularly scheduled direct flights, and investment is 
still in only one direction:  from Taiwan to the Mainland. 
Sun Shengliang (protect), Director of the Economic Department 
at CASS ITS, told PolOff November 12 that the Mainland is 
looking for "full normalization" of cross-Strait exchanges 
that will be "deep and lasting."  Sun noted that the next 
round of ARATS-SEF talks in early 2009 will focus on issues 
such as capital markets, financial services, a free trade 
arrangement and investment guarantees to help remedy the 
investment imbalance. 
 
AGREEMENTS FACILITATE "PEACEFUL DEVELOPMENT FRAMEWORK" 
--------------------------------------------- --------- 
 
¶4. (C) The ARATS-SEF agreements will promote economic 
integration between the two sides, furthering President Hu 
Jintao's goal of establishing a "peaceful development 
 
BEIJING 00004328  002 OF 004 
 
 
framework" across the Taiwan Strait while deferring sensitive 
political issues, contacts say.  CASS's Sun predicted that 
over the next two to three years these most recent agreements 
will prove "very beneficial" for Taiwan.  Taiwan has mostly 
used the Mainland as a manufacturing platform for exports, 
but the ease and efficiency of transportation and shipping 
resulting from the new agreements will increase Taiwan's 
reliance on the China market as an end destination for Taiwan 
products, which will make Taiwan businesses more competitive 
with South Korean firms in the IT sector, Sun asserted. 
NSTS's Zhou Zhihuai predicted that within five years, the 
political sensitivity of cross-Strait exchanges will have 
"dissipated."  The "normalcy" of this interaction will 
increase mutual trust and "inevitably" result in Taiwan 
"feeling" more like a part of China.  Peking University's Jia 
Qingguo described Hu Jintao's peaceful development framework 
as an effort to "increase economic integration while kicking 
political issues down the road." 
 
"UNEXPECTED" LEVEL OF CHAOS 
--------------------------- 
 
¶5. (C) The security challenges Chen faced during his visit 
may dampen future cross-Strait exchanges held in Taiwan. 
Professor Jia Qingguo said the "degree of chaos" during Chen 
Yunlin's trip was "unexpected," as was the preceding October 
21 "attack" on ARATS Deputy Zhang Mingqing.  Jia said the 
Mainland probably should not have been surprised because of 
the "rough-and-tumble nature" of Taiwan politics as well as 
the fact that Taiwan politicians often use such incidents to 
generate publicity for themselves.  In one respect, the 
assault on Zhang Mingqing was "good" because it resulted in 
increased security for Chen Yunlin during his subsequent 
trip, Jia concluded.  Even though the TAO spokesperson on 
November 12 claimed that the protests will not affect future 
cross-Strait exchanges, Jia predicted that they will likely 
have a "deterrent effect," especially on high-level Mainland 
travelers to Taiwan.  Jia expressed concern that his own 
plans to attend a conference in Taiwan, his first visit in 
nearly 10 years, may be put on hold by "TAO bureaucrats" who 
could be blamed for approving the trip if anything untoward 
should happen to Jia as a CPPCC member.  CASS's Sun 
Shengliang separately said the pan-Green demonstrations could 
have a "psychological" effect on future cross-Strait 
exchanges in Taiwan and may even affect Mainland tourism to 
the island. 
 
PROTESTS REINFORCE NEGATIVE VIEWS OF TAIWAN 
------------------------------------------- 
 
¶6. (C) The protests against Chen Yunlin have also resulted in 
"mixed" views on the Mainland of Taiwan's political system. 
Ma Ying-jeou's March election and the peaceful transfer of 
power in May swung Mainland public opinion in a "very 
positive direction," but the Zhang Mingqing incident and the 
protests against Chen have "made Taiwan look bad," Jia said. 
Chen Shui-bian's detention, however, has grabbed the 
Mainland's attention and begun to increase more "positive" 
views of Taiwan.  Senior Chinese leaders have been brought 
down on corruption charges before, but never the "top 
leader," Jia explained.  Jia opined that Chen's detention was 
"long overdue," but he praised Ma Ying-jeou's handling of the 
case by allowing the judiciary to act independently. 
 
EFFECT ON MAINLAND'S CROSS-STRAIT POLICY? 
----------------------------------------- 
 
¶7. (C) Asked whether Taiwan's internal security situation 
would affect Mainland debate on China's broader Taiwan 
policy, Sun said the "mainstream view" is that China must do 
something to "help Ma against the DPP."  Some in China hold 
the view that the DPP is still strong and could take power 
again, so the Mainland should not make any concessions 
related to sovereignty that could be later used by the DPP to 
assert Taiwan's independence, but, Sun asserted, this is the 
"minority view."  He assessed that the DPP will be "even more 
marginalized" by its actions before and during Chen Yunlin's 
visit.  The DPP does not have a coherent cross-Strait policy 
but simply "opposes everything the KMT does," Sun concluded. 
Jia Qingguo worried that if Ma Ying-jeou loses the next 
election, any concessions the Mainland makes now will be used 
against it in the future.  Jia admitted that the PRC is 
"likely to be more liberal" if it looks like Ma is strong and 
will be re-elected. 
 
THE MA-CHEN MEETING AND "MUTUAL NON-DENIAL" 
 
BEIJING 00004328  003 OF 004 
 
 
------------------------------------------- 
 
¶8. (C) Asked about the proposal made in the Hong Kong media 
by Peking University Professor Peng Zhenhuai (ref B) for Chen 
Yunlin to address Ma Ying-jeou as "President" during their 
meeting, Jia Qingguo said the idea had "no following" among 
Mainland policymakers.  Saying he personally does not know 
Peng, Jia insisted that the idea was the professor's own and 
not a "trial balloon" that reflected leadership thinking. 
Chinese professors increasingly have more freedom to publish 
"unorthodox views," even though doing so is "still risky." 
If Peng's views garner too much publicity or result in 
pressure on the Chinese Government, Peng could lose his job, 
Jia commented.  CASS's Sun was aware of Peng's article, but 
he dismissed it as demonstrating a "lack of understanding" 
about PRC Taiwan policy. 
 
¶9. (C) Asked about Taiwan assertions (ref D) that Chen 
Yunlin's meeting with Ma Ying-jeou demonstrated China's tacit 
acceptance of Ma's "mutual non-denial" proposal, Mainland 
contacts insisted that there has been no "formal" acceptance 
of the concept.  Peng Weixue (protect), Chief Editor of 
CASS-ITS's Taiwan Weekly magazine, nevertheless conceded to 
PolOff November 18 that the Ma-Chen meeting does in some 
sense demonstrate Beijing's "tacit acceptance" of the "mutual 
non-denial" concept.  But the issue still remains a 
"sensitive political topic" in China that is best dealt with 
"later."  Therefore, for now, China is simply "not denying 
mutual non-denial," Peng asserted.  NSTS's Zhou Zhihuai also 
declined to deny mutual-denial.  He noted that even a 
"relatively simple" issue such as the three links took 30 
years to complete, so it follows that "difficult political 
issues," such as sovereignty, international space and 
security issues, as well as "mutual non-denial," will take a 
"long time" to resolve. 
 
OVERLOOKING "SLIGHTS" 
--------------------- 
 
¶10. (C) Despite the security problems, Beijing is focusing on 
the "big picture" and the long-term positive outcomes of 
Chen's visit, contacts emphasized.  CASS's Sun Shengliang 
commented that even though Chen Yunlin may have been 
"personally offended" by being trapped in the Formosa Regent 
Hotel and not being able to make a statement during his 
meeting with Ma Ying-jeou, Chen would not put his personal 
concerns ahead of the larger mission to improve cross-Strait 
relations.  If Chen were to complain or take offense over any 
"slights" suffered during the trip, Sun asserted, that would 
only help "DPP efforts to harm cross-Strait relations."  Even 
ARATS Deputy Zhang Mingqing expressed hope that the violence 
he encountered personally in Taiwan will not affect broader 
cross-Strait relations, Sun pointed out.  Similarly, the TAO 
spokeswoman's refusal on November 12 to comment on the 
quality of the security arrangements in Taiwan was designed 
to avoid playing into DPP hands.  If China publicly were to 
praise the efforts of Taiwan security forces, the DPP could 
claim the Mainland "colluded" with the KMT to "suppress human 
rights" in Taiwan.  On the other hand, Sun noted, if China 
were to express displeasure with the security arrangements, 
it could lead to "strain" in cross-Strait relations and 
overshadow the many positive accomplishments of Chen's trip. 
 
INTERNATIONAL SPACE REQUIRES FURTHER CONSULTATIONS 
--------------------------------------------- ----- 
 
¶11. (C) China's approach to Taiwan's participation in the 
activities of the World Health Assembly/World Health 
Organization (WHA/WHO) next May remains a hot topic of 
conversation in Beijing (ref C), with contacts emphasizing 
that any possible progress on the matter will require further 
consultation between the two sides.  CASS's Sun Shengliang 
said that even though ARATS-SEF discussions have so far 
avoided the issue of international space, it has been a topic 
of conversation in KMT-CCP party-to-party talks as well as in 
academic exchanges and other "unofficial and 
non-governmental" channels.  Sun expressed hope that a 
breakthrough will be made by next May, noting that Ma 
Ying-jeou is pushing for progress on the issue.  Sun argued 
that the United States and Japan should not pressure China on 
the issue but rather should allow the two sides the space and 
time to work out a solution on their own.  By contrast, 
NSTS's Zhou Zhihuai hoped that Washington could play a 
"helpful" role in resolving the international space issue, 
arguing that American involvement would help Beijing and 
Taipei draw "closer together" on the subject.  Zhou 
 
BEIJING 00004328  004 OF 004 
 
 
emphasized, however, that both sides of the Strait should be 
encouraged to reach a solution on the international space 
issue, rather than just pushing the Mainland to make a 
"unilateral concession."  CASS-ITS's Peng Weixue told PolOff 
that any progress on such a "significant issue" as Taiwan's 
international space would have to be made through the 
SEF-ARATS channel and could not simply be decided through a 
"unilateral concession" by Beijing. 
 
LIEN CHAN AT APEC A "BIG DEAL" 
------------------------------ 
 
¶12. (C) Embassy contacts have argued that China's 
acquiescence to KMT Honorary Chairman Lien Chan's 
participation at the APEC Summit in Peru is a "significant 
concession" on cross-Strait relations, as well as on Taiwan's 
international space.  A visiting U.S. expert told PolOff 
October 31 that during a meeting his delegation attended 
earlier that day with TAO Minister Wang Yi, Wang specifically 
pointed to the approval of Lien Chan as Taiwan's APEC envoy 
in response to a charge that the PRC had done nothing on the 
international space issue.  Peking University's Jia Qingguo 
told PolOff that Lien's participation in APEC is a "big 
deal."  Jia expressed concern that a future DPP 
administration would demand similar treatment, quipping that 
the prospect of former Taiwan Vice President Annette Lu 
attending APEC is "not a pleasant thought."  Even if China 
insisted that Taiwan accept some sort of annual approval of 
its envoy, Lien's participation still sets a precedent, Jia 
commented.  CASS-ITS's Peng Weixue opined that the approval 
of Lien Chan was due to the "comfort level" Chinese leaders 
have with him personally, as well the general improvement in 
cross-Strait relations.  Because of frequent contacts since 
2005, Chinese leaders have built up a sufficient level of 
trust in Lien Chan, making him an acceptable candidate.  That 
may not have been the case had Ma Ying-jeou nominated someone 
else, Peng said. 
RANDT