The decision by Chinese President Hu Jintao (胡錦濤) to attend a nuclear security summit in Washington later this month may mean further delays for Taiwan's request to buy advanced F-16 fighters.
It also explains why US Deputy Secretary of State James Steinberg went out of his way earlier this week to stress that the US did not support independence for Taiwan and why US President Barack Obama “reaffirmed” Washington's “one China” policy when he received new Chinese Ambassador Zhang Yesui (張業遂) on Monday.
The US was smoothing the road for Hu's two-day visit and for a possible longer official trip to the US later this summer, which would be in return for Obama’s Beijing visit in November last year.
As widely reported by the US press, Obama has probably also given Hu private assurances that he will not be embarrassed by a US Treasury report due on April 15 that could declare China to be a currency manipulator.
That report is now likely to be delayed indefinitely.
By way of return, China may have been persuaded to allow the yuan to appreciate against the dollar and may cooperate with a US drive for more sanctions on Iran.
Both the Washington Post and the New York Times said there had been speculation that China would send a lower-level delegation to the April 12 to April 13 nuclear summit to show its displeasure with Washington over arms sales to Taiwan.
The newspapers reported that US-China strains — triggered by the arms sales to Taiwan — were now easing.
This in turn may affect Taiwan’s request to buy 66 F-16C/D fighters — a request supported by many in Washington and currently being considered by the White House.
If that sale were to be approved, it would severely damage US-China relations at a time when Obama is doing everything possible to improve them.
At the very least, a decision on the fighter sale is now likely to be postponed until well after Hu’s potential summer visit.
A new air power report is also due to go to Congress in the late summer, and it is unlikely that the Obama administration will move before the report has been studied.
“No one expects a decision in the next several months,” US Taiwan Business Council president Rupert Hammond-Chambers said.
The F-16 production line is currently scheduled to run until 2013.
Orders to keep the line running beyond that time must be made in the next 12 to 18 months to ensure continuity — otherwise the line will start to close down.
No new orders means that contractors will start switching manufacturing to other areas once current orders end, Hammond-Chambers said.
Reopening the line would be prohibitively expensive.
“It is going to make this entire discussion academic if the issue continues to be punted into the future,” Hammond-Chambers said.
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