Stanley O. Roth, Assistant Secretary for East Asian and Pacific Affairs, U.S. Department of State, Address to the Woodrow Wilson Center and the American Institute in Taiwan, "The Taiwan Relations Act at Twenty -- and Beyond," Washington, DC, March 24, 1999


Introduction

Ladies and Gentlemen, good afternoon.

Thank you for the opportunity to address the twentieth
anniversary of the Taiwan Relations Act. I look forward to
exchanging ideas and points of view, and to affirming that the
U.S. is following the best possible path for an issue we all care
a great deal about.

Before commencing, let me thank our hosts, the Woodrow Wilson
Center and the American Institute in Taiwan, and in particular my
old friends, Bob Hathaway and Richard Bush, for making this
discussion possible and for inviting me to participate.

The TRA -- A Home Run With Bases Loaded

Some twenty years ago, I was a new foreign policy specialist on
Congressman Steve Solarz's staff. When President Carter decided
to recognize the People's Republic of China, I found myself
grappling with my first significant policy issue: the nature of
U.S.-Taiwan relations in a fundamentally changed world. It was,
in fact, the Taiwan question -- how to preserve the long-standing
friendship and common interests between the U.S. and Taiwan in
the absence of diplomatic relations -- that initiated my interest
in Asia and shaped my life's work.

I vividly remember the confused and anxious atmosphere of 1979,
as well as the sense of solemn urgency. Clearly, the challenge of
what ultimately became the Taiwan Relations Act -- the TRA -- was
to ensure that normalization of our relations with the People's
Republic of China did not result in the abandonment of Taiwan.
This premise led to the articulation of the fundamental goals of
the TRA as laid out in Section 2(a):

"...(1) to help maintain peace, security, and stability in the
Western Pacific; and

(2) to promote the foreign policy of the United States by
authorizing the continuation of commercial, cultural, and other
relations between the people of the United States and the people
on Taiwan."

I have no hesitation in declaring the TRA a resounding success.
Over the past twenty years, the TRA has not only helped to
preserve the substance of our relationship with Taiwan, it has
contributed to the conditions which have enabled the U.S., the
P.R.C., and Taiwan to achieve a great deal more.

I wish to digress a moment and note that the TRA was not only the
creation of Congress. Close working relationships among the
Carter White House, the Departments of State and Defense, leading
members of both political parties, and expert legal scholars,
contributed to the fundamental soundness of not only the wording
of the legislation but also to its underlying concepts. I am
convinced that this close degree of cooperation was critical in
distilling the essence of the TRA, and I believe it is an example
we should seek to emulate more often when addressing the foreign
affairs of our nation.

No Zero Sum Game

As I noted earlier, the TRA was born of the U.S. decision to
normalize relations with the P.R.C. The U.S.-P.R.C. relationship
that followed that decision -- for all of its ups and downs --
has contributed enormously to stability and peace in Asia.

In turn, this positive Asian environment, supplemented by the
specific assurances of the TRA, has been conducive to the people
of Taiwan developing and applying their great creativity and
capabilities to bettering their lives. The result has been
Taiwan's extraordinary economic and political development. The
unofficial U.S.-Taiwan relationship has prospered accordingly.

Arguably, however, while the gains in the U.S.-P.R.C. and U.S.-
Taiwan relations have been formidable, the Beijing-Taipei
relationship has actually experienced the most dramatic
improvement. The trade, personal contacts, and dialogue now
taking place across the strait were unimaginable twenty years
ago.

In reviewing the past twenty years of these three intertwined
relationships, what becomes absolutely apparent is that gains in
one relationship do not dictate a loss in either of the other
two. In fact, the reverse is true: gains in one have contributed
to gains in the others.

U.S.-P.R.C. Relations

Twenty years ago, immediately prior to normalization of our
relations with the P.R.C., Asia looked like a very different
place to the U.S. With our crushing experiences in Vietnam fresh
in our minds, the U.S. was unsure of its future role in Asia, saw
the advent of communism throughout the region as a distinct
possibility, and viewed China primarily in terms of the global
anti-Soviet struggle. With a stroke of a pen, normalization
opened up channels of communication with China's government and
its citizens. Tensions in the region decreased, and China
embarked on an ambitious effort to reform and open its economy.
The stability that ensued engendered years of unprecedented
economic development throughout Asia as well as in China itself.
Our relationship with the P.R.C. grew and developed. The
unfolding of the U.S.-P.R.C. relationship not only did not harm
Taiwan, it significantly contributed to Taiwan's ability to reach
the degrees of democracy and prosperity it enjoys today.

Over the last two decades, China's remarkable economic
achievements, increasing diplomatic prominence, and gradually
increasing military strength have affirmed our decision to begin
constructing a relationship with the P.R.C. by normalizing
relations. Built on the foundation of normalization, six U.S.
administrations of both parties have engaged Beijing in order to
promote U.S. interests and to encourage a responsible P.R.C. role
in the world.

Positively, our efforts have resulted in a situation where U.S.
and Chinese officials now regularly conduct a genuine and candid
discourse on some of the most pressing geopolitical issues
confronting our two nations. Last fall China worked closely with
the United States to bring North Korea to the negotiating table
and now sits with us at the four party talks in the common
pursuit of a permanent peace. China and the US have worked
similarly well together on South Asia, with both nations seeking
to reduce escalating nuclear tensions on the Indian subcontinent.

On the other hand, as Secretary Albright's most recent trip to
Beijing bears witness, we also engage in genuine and candid
discourse on pressing bilateral issues where we clearly disagree.
Human rights is an important case in point, as are the recent
allegations of theft of nuclear technologies and the questions of
missiles and potential missile defense systems in Asia.

U.S.-Taiwan Relations

We should frankly acknowledge that Taiwan would prefer official
diplomatic relations with the United States to unofficial
relations. However, that said, the fact that our relations are
unofficial has not harmed Taiwan's interests.

Twenty years ago, Taiwan was under martial law and human rights
violations occurred with regularity. That Taiwan no longer
exists. Today, to my great pleasure, human rights violations are
no longer necessary topics of discussion. Politically, Taiwan has
a vibrant democracy characterized by free elections, a free press
and dynamic political campaigns. The 1996 direct election of the
President and Vice President stands out as a particular high
point, and Taiwan's competitive democratic system continues to
mature.

Taiwan's political metamorphosis has been profound and serves as
an example of peaceful democratic change in the region and
beyond. The shelter of the TRA, made real by each successive
administration's commitment to its provisions, helped make this
transformation possible. In close consultation with Congress,
U.S. administrations have implemented our obligation under the
TRA to provide articles and services necessary to Taiwan to
maintain a sufficient self-defense capability. We have provided
Taiwan with F-16s, Knox class frigates, helicopters, and tanks as
well as a variety of air-to-air, surface-to-air, and anti-ship
defensive missiles. We continually reevaluate Taiwan's posture to
ensure we provide Taiwan with sufficient self-defense capability
while complying with the terms of the 1982 Communique.

The Department of Defense's recent assessment of the security
situation in the Taiwan Strait concludes that, except in a few
areas, despite modest qualitative improvements in the military
forces of both China and Taiwan, the dynamic equilibrium of those
forces in the Taiwan Strait has not changed dramatically over the
last two decades. This assessment means that for twenty years the
TRA has been effective.

As you know, the U.S. maintains a significant forward-deployed
presence in East Asia in connection with our alliances with
Japan, the Republic of Korea, and other allies. This presence
contributes importantly to regional stability, including the area
around Taiwan, as was demonstrated in March 1996 with our
deployment of two carrier battle groups to waters near Taiwan.

On the economic front, the U.S. and Taiwan share a vibrant,
mutually beneficial trade relationship. Taiwan is the 14th
largest trading economy in the world and the seventh largest
market for U.S. exports. It constitutes our fifth largest foreign
agricultural market and a major market for U.S. automobiles. For
our part, the U.S. absorbs one fourth of all Taiwan exports, and
our annual bilateral trade exceeds $50 billion.

The economic partnership, moreover, continues to grow. Taiwan's
sophisticated economy is largely withstanding the Asian Financial
Crisis and acting as a support for the region. Taipei is now
pursuing an ambitious, multi-billion dollar series of
infrastructure projects -- projects for which U.S. firms are
helping to provide professional services and equipment. Taiwan
and the U.S. passed a milestone in their economic relationship
last year with the successful completion of bilateral
negotiations concerning Taiwan's application to the World Trade
Organization. All indications are that Taiwan will continue to be
an important export market for the United States.

Cross-Strait Relations

As I mentioned earlier, even having just reviewed the enormous
achievements in both the U.S.-P.R.C. and the U.S.-Taiwan
relationships over the past twenty years, I would nonetheless
argue that the most remarkable transformation has in fact taken
place in the cross-strait relationship. Twenty years ago, the
P.R.C. and Taiwan were "trading" propaganda-filled artillery
shells. Today, economic figures tell a much different story.

In the five years from 1993 to 1998, cross-strait trade has grown
on average by over 13 percent per year, and stood at $22.5
billion at the end of 1998. In fact, trade with the P.R.C.
accounted for over 10 percent of Taiwan's trade with the rest of
the world in 1998, making the P.R.C. Taiwan's third largest
overall trade partner surpassed only by the U.S. and Japan.

Imports from the P.R.C. to Taiwan are growing even faster -- by
an average of over 40 percent per year over the last five years -
- albeit from a lower base. 3.9 percent of Taiwan's global
imports came from the P.R.C. in 1998.

Taiwan investment in the P.R.C. now exceeds $20 billion. With
30,000 individual Taiwan firms having invested in the P.R.C.,
over three million mainland Chinese are now employed with firms
benefiting from that commitment of funds.

Economic ties have led to increasing personal ties. Up to 200,000
Taiwan business people now live and work in the P.R.C. Since the
opening of cross-strait travel a decade ago, more than ten
million Taiwan residents have visited the mainland.

This greater economic interaction is positive. Taiwan's security
over the long term depends more on the two sides coming to terms
with each other than on the particular military balance. Much
like Adam Smith's invisible hand of the market place, myriad
individual economic and social ties across the strait will
contribute to an aggregate self-interest in maintaining the best
possible cross-strait relations.

Politically, gains are also apparent. One of the most salutary
developments in East Asia during the early 1990s was the
emergence of a dialogue between Taiwan's Straits Exchange
Foundation, or SEF, responsible for Taiwan's unofficial relations
with the mainland, and the Mainland's Association for Relations
Across the Taiwan Strait, or ARATS. As I am sure you are aware,
in late 1998, SEF Chairman Koo Chen-fu led a twelve-member
delegation on a five-day "ice-melting" visit to the mainland. In
addition to meetings with ARATS Chairman Wang Daohan, the visit
also included a meeting with P.R.C. President Jiang Zemin and
other ranking P.R.C. officials. In a goodwill gesture, Chairman
Koo was invited to stay at the P.R.C.'s official Diaoyutai State
Guest House; an offer he accepted.

Koo's October visit was able to reach a four-point consensus
which includes:

(1) a return visit to Taiwan by ARATS Chairman Wang, a visit now
scheduled for fall;

(2) further dialogue on political, economic, and other issues;

(3) more exchanges between SEF and ARATS; and

(4) greater assistance (on personal safety and property) for
people visiting the mainland, and vice versa.

Chairman Koo's visit was the highest level contact between
Beijing and Taipei since 1949. As such, it substantially improved
the climate for cross-strait exchanges. The consensus that was
forged provides an excellent basis for developing the approaches
necessary to resolve the difficult issues between the two sides.

The TRA in the Future

Anniversaries call for us to commemorate the past, but they also
cause us to look to the future and ask ourselves: Will our past
decisions, choices, and preparations stand up to the unknown
challenges that may lie ahead? With respect to the TRA, we can
clearly answer: yes.

Insisting on peaceful resolution of differences between the
P.R.C. and Taiwan will remain U.S. policy in the future just as
surely as it has been our policy over the past twenty years. Our
belief, which we have stated repeatedly, is that dialogue between
the P.R.C. and Taiwan fosters an atmosphere in which tensions are
reduced, misperceptions can be clarified, and common ground can
be explored. The exchange of visits under the SEF/ARATS
framework, currently rich in symbolism but still nascent in
substance, has the potential to contribute to the peaceful
resolution of difficult substantive differences.

Clearly, this will not be easy, but this Administration has great
confidence in the creativity of the people of Taiwan and the
people of the mainland, working together, to identify the
necessary human contacts and the most comfortable processes to
give the dialogue real meaning. Using a phrase that has garnered
much favor in Washington of late, I could imagine that "out of
the box" thinking within this dialogue might contribute to
interim agreements, perhaps in combination with specific
confidence building measures, on any number of difficult topics.
But, as the U.S. has steadfastly held, we will avoid interfering
as the two sides pursue peaceful resolution of differences
because it is only the participants on both sides of the strait
that can craft the specific solutions which balance their
interests while addressing their most pressing concerns.

Military capabilities on both sides of the strait are obviously a
mutual concern. From the P.R.C.'s perspective, it should be
important to determine whether development or upgrade of any one
type of weapons system will contribute to the P.R.C.'s security,
or, conversely, whether it might actually detract from that
security by fostering tension, anxiety, political instability, or
an arms buildup in the region. At the heart of this calculation
is the explicit assumption that the P.R.C. cannot expect to
pursue its defense policy in a vacuum. Its decisions on military
modernization will generate responses from other actors. Or, as
Secretary Albright recently said in Beijing:

"Nothing would better serve China's interest than using its
developing dialogue with Taiwan to build mutual confidence and
reduce the perceived need for missiles or missile defense."

>From Taiwan's perspective, the TRA's continuing guarantee that
Taiwan will not suffer for lack of defensive capability will help
to contribute towards Taiwan's confidence and counterbalance
anxieties over P.R.C. military capabilities.

In this age of highly sophisticated weaponry, I think we are all
sometimes prone to equating security with military capability.
This is a fallacy. Real security does not flow from arms alone
and reliance on military measures in lieu of other approaches
will eventually jeopardize the democracy, prosperity, and
security that the people of Taiwan now enjoy and the people of
the P.R.C. expect to enjoy in the future. Of course, the United
States Government will abide by the TRA and provide appropriate
defense articles and services to Taiwan, first of all because it
is the law, and second because such transfers will enhance
Taiwan's confidence to engage the mainland. But a durable peace
will rest less on arms than success in addressing differences
through dialogue on a mutually acceptable basis. Thus, whereas
such things as missiles and missile defense systems can
ultimately not secure peace and prosperity, dialogue and
difficult compromise can do so.

Dialogue and compromise cannot be wedded to an imposed timetable.
Good faith is required of, and in the interest of, both sides.
The provisions of the TRA and general U.S. policy in the region
will continue to contribute to an environment conducive to
dialogue and therefore to finding a lasting resolution to
differences across the Taiwan strait.

Conclusion

U.S. relations with the P.R.C. and the people of Taiwan are
likely to be one of our most complex and important foreign policy
challenges for many years to come. This Administration, like the
five Republican and Democratic Administrations before it, firmly
believes that the future of cross-strait relations is a matter
for Beijing and Taipei to resolve. No Administration has taken a
position on how or when they should do so. What we have said, and
what I repeat here today, is that the United States has an
abiding interest that any resolution be peaceful.

Over the last twenty years the TRA has served our interests well.
I fully expect that it will continue to do so during the next
twenty years.


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