Let's get this straight: Beijing will not discuss routine matters with Taipei concerning hundreds of thousands of Taiwanese citizens living in China and refuses to negotiate an investment protection agreement despite US$100 billion invested there by Taiwan-ese companies. Its diplomatic blockade of Taiwan's participation in the international community is nearly insurmountable.
As if this were not enough, the Chinese military annually stages mock invasions, deploys hun-dreds of missiles aimed at Taiwan and keeps squadrons of warplanes within striking distance.
Oh, but never mind, says Douglas Paal, director of the American Institute in Taiwan. Taiwan's government should throw caution to the wind and let rip more integration with the world's biggest market hell-bent for growth. Unshackle those entrepreneurs and open more trade and investment channels, he says.
It's not as if the American Chamber of Commerce in Taipei (Amcham) had not been hammering away on this theme for years, though not so clumsily. (To be fair, so have some prominent Taiwan-ese business leaders and business lobbies.) By feigning ignorance of the cross-strait conflict, it appears that the decision to open direct links between Taiwan and China is largely a one-sided affair. And the economic benefits are presumed to be so compelling that no non-economic factors (such as those that routinely shape US foreign economic policy) should block their accomplishment. After all, isn't the rest of the world rushing to set up shop in China -- though not at the risk of their govern-ment's dignity and sovereignty?
Yet at this advanced stage of cross-strait economic ties, Tai-wan's policymakers don't need more simplistic exhortations about getting off the backs of business. They do need some creative ideas on how to ease legitimate fears of overexposure to the world's fastest growing economy and on how to manage the associated risks, which are considerable.
Even if Beijing were not hostile to Taiwan's government, there would be reason enough for caution. But showing contempt for the reality of a hostile China, as perceived by many government policymakers and most of its top leaders, does not win friends or build confidence. It also doesn't help to shape prudent policies on where to go from here.
It's sad that a distinguished business group such as Amcham continues to act dumb (at least in public) on something as crucial to Taiwan as relations with China, treating them as a one-dimensional exercise in trade and investment. Perhaps Taiwan's most influential foreign business lobby is just playing devil's advocate in a well-worn national debate, though it also suggests a politically challenged business community. It's as if they see Beijing's ambitions toward Taiwan as a victimless pseudo-crime waiting to happen, no matter what anyone says or does.
It might be forgivable if Amcham's Beijing chapter were telling the authorities there to ease up on their pig-headed policies. But that may be too much to ask, even for outspoken Americans.
Someone might also ask why Washington has for so long resorted to trade sanctions, investment bans and other economic measures to punish recalcitrant and unfriendly governments, even those like Cuba, which pose no national security threat to the US. Apparently there is a different calculus when things are close to home.
Yet let's hope Paal is not so enamored of China that he actually believes Taiwan has nothing to fear and everything to gain from unfettered trade and investment there, as his quoted remarks suggest.
In the absence of a fair political settlement between Beijing and Taipei, the reality is that the pre-sent economic trends for Taiwan are deeply worrying. How does unfettered faith in free-markets and open capital flows ease these concerns? Not much, unless one heavily discounts the risks which closer economic ties with China pose.
The advice to "just let go" sounds like the policy cure-alls popular during the boom years of the 1980s and 1990s when deregulation and laissez-faire philosophies were in vogue. As a policy prescription under the shadow of Taipei's political-military standoff with Beijing, such advice is reckless and irresponsible.
Yet is this really a debate that is properly joined by Washington's top representative to Taipei? And shouldn't AIT pay some deference to President Chen Shui-bian (陳水扁), who takes a much bleaker and arguably more realistic view of China, as he did recently on the first anniversary of the terrorist attacks on the US?
Are Paal's views Washington's official position or merely personal comments? The public can hardly be expected to understand the difference, especially in a place where every utterance concerning Taiwan by US officials is carefully scrutinized.
AIT also might want to brief its director on the track record of Taiwan's much touted entrepre-neurs. Taiwanese have long been among the most risk-friendly in Asia, investing anywhere and any way. Besides China -- where they decamped in embarrassingly large numbers when the world shunned that country after the 1989 military crackdown in Tiananmen Square -- they rushed into Vietnam and Cambodia long before it was advisable to do so. Many, if not most, lost their shirts.
Of course it's their time and money. But their collective decisions over the past decade have linked Taiwan's economy to China's like none other in the world. This has some obvious benefits, such the Taiwan's massive trade surplus. But there are many unanswered questions, such as how are Taiwanese companies actually performing in China and how does any success there contribute to prosperity at home? After more than a decade of operations in China by stock-listed companies, almost no capital has been remitted home.
So the burden for Taipei is not so much to unshackle its entrepre-neurs, but to encourage them to think before they leap and to defend against undesirable consequences. Whether or not they agree, Washington and its emissaries could at least show that they understand these concerns.
Julian Baum reported on Taiwan for the Far Eastern Economic Review from 1990 to 2000.
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