Second Taiwanese leader in China

Friday, May 6, 2005 Posted: 0355 GMT (1155 HKT)

12:03 AM - May. 6, 2005 - comments {1} - post comment

Taiwan leader urges China talks

Sunday, May 1, 2005 Posted: 2224 GMT (0624 HKT)

1:03 PM - May. 2, 2005 - comments {0} - post comment

U.S.: N. Korea apparently tests missile

WASHINGTON (CNN) -- North Korea apparently tested a short-range missile Sunday, the Bush administration said, the latest in a string of recent incidents to refocus international attention on the Korean Peninsula's nuclear standoff.

"It appears that there was a test of a short-range missile by the North Koreans and it landed in the Sea of Japan," White House Chief of Staff Andrew Card said on CNN's "Late Edition."

The day before the apparent test, North Korea called President Bush a "hooligan" and said it expected no solution of the international standoff over its nuclear program during the current U.S. administration. (Full story)

The comments by North Korea's Foreign Ministry spokesman followed a White House news conference Thursday at which Bush described North Korean leader Kim Jong Il as a "tyrant" and a "dangerous person." (Transcript)

Also Thursday, a Defense Department intelligence official said North Korea has the "theoretical capability" to arm a missile with a nuclear device and strike the United States.

Card said Sunday that the White House was "not surprised" by the apparent missile test.

"The North Koreans have tested their missiles before," he said. "They've had some failures"

Six-nation talks on persuading North Korea to curb its nuclear ambitions -- involving the two Koreas, the United States, China, Japan and Russia -- have been stalled since last June, after three inconclusive rounds.

"We have to work together with our allies around the world -- especially the Japanese, the South Koreans, the Russians and the Chinese -- to demonstrate that North Korea's actions are inappropriate," Card said. "We don't want the Korean Peninsula to have any nuclear weapons on it."

North Korea has said it will stay away from the nuclear talks until Washington apologizes for comments U.S. Secretary of State Condoleezza Rice made in January, when she described the communist state as one of the world's "outposts of tyranny."

Resuming the talks gained urgency in February when North Korea said it had developed nuclear weapons and would boycott the talks indefinitely. The North has since threatened to increase its nuclear arsenal and has demanded that the United States drop what it calls a hostile policy.

Sunday, Card described Kim as "not a good leader."

He said North Koreans "are living in poverty -- many in concentration camps. They do not have any exercise of democracy or freedom. They are not allowed to contact the outside world. [Kim] is not the kind of leader that is comfortable with the rest of the world."

On NBC's "Meet the Press," Card portrayed North Korea as a target of U.S. efforts to inspire democracy around the world.

"We're doing everything we can to make sure that the people of North Korea recognize that they're being cheated and denied opportunities that come with freedom and democracy," he said.

Diplomatic disagreement

U.S. State Department spokesman Curtis Cooper issued a statement saying the missile test apparently took place Sunday.

"We are continuing to look into this," Cooper said. "We are consulting closely with governments in the region. We have long been concerned about North Korea's missile program and activities, and urge North Korea to continue its moratorium on ballistic missile tests."

Sunday's test came one day before the opening of a nearly monthlong United Nations conference on the nuclear nonproliferation treaty. The U.N. convenes the meetings once every five years to review developments under the accord, from which North Korea withdrew in January 2003.

North Korea tested missiles in 2003, and in 1998, it test-fired a missile over Japan into the Pacific Ocean.

Japanese officials had no immediate response to reports of Sunday's test. But it is likely to have the biggest political impact in that country, said an international security expert from Harvard University.

"It's going to make the Japanese nervous," Jim Walsh told CNN on Sunday. "And it's going to put pressure on the Japanese prime minister."

Sen. Carl Levin, the top Democrat on the Armed Services Committee, said on "Late Edition" that Sunday's test shows the Bush administration's refusal to hold direct talks with Pyongyang is leading to an even greater nuclear threat.

The test, Levin said, is "additional, very discouraging evidence that this administration's policy towards North Korea is failing. We've had a lot of other evidence in the last four years -- the fact that they have renewed their reprocessing program of plutonium; the fact that they're now enriching uranium; and the fact they apparently can now put a nuclear weapon on a missile."

Last week, U.S. Defense Intelligence Agency Director Lowell Jacoby testified on Capitol Hill that, according to a U.S. assessment, North Korea has the capacity to arm a missile with a nuclear device and hit U.S. territory.

Such a "two-stage" missile is "assessed to be within their capacity," Jacoby said in response to a question from Sen. Hillary Rodham Clinton, a New York Democrat.

The Pentagon later argued that Jacoby was not stating new information but only reiterating his previous statements that North Korea has a "theoretical capability to produce a warhead and mate it with a missile."

"We have no information to suggest they have done so," Pentagon spokesman Bryan Whitman said in a statement Saturday.

Walsh said North Korea has never successfully tested a long-range missile or a nuclear device -- much less a combination of the two.

"We are very, very far from that point," he told CNN.

But Levin argued that the danger North Korea presents is mounting. He pointed to an official moratorium on missile testing "that the North Koreans imposed on themselves" toward the end of the Clinton administration "when we were talking directly to the North Koreans."

In addition to the multilateral talks, Levin said, the Bush administration should "talk directly to the North Koreans. That's what's been missing. ... The nuclear threat is increasing from North Korea as a result."

But Sen. Norm Coleman, a Minnesota Republican on the Foreign Relations Committee, said North Korea lied to the United States in the bilateral talks during the Clinton presidency.

"On the one hand, we thought we solved the problem, and they were picking our pocket with the other hand, developing nuclear capability," Coleman told CNN on Sunday. "It's not that it's impossible to negotiate with them, it's that it's worthless to negotiate with them because Kim Jong Il is a petty tyrant."

Multilateral talks could make a difference because "China has some leeway on North Korea," Coleman said. "If you bring enough people in who have a stake in what happens, those in the region, you got a better chance of getting something done."

Levin countered that China and South Korea want the United States to hold bilateral talks in addition to the multilateral negotiations.

Sunday's test "was a political act, not a military act," Walsh said, calling it "an attempt to put pressure on the United States, to try to get them to come and talk to the North Koreans."

During his televised news conference Thursday, Bush insisted the six-party talks are working and are the best way to solve the dispute.

"The best way to deal with this diplomatically is to bring more leverage to the situation by including other countries," he said.

12:48 PM - May. 2, 2005 - comments {0} - post comment

Lien gets closer to Beijing

Friday, April 29, 2005 Posted: 0654 GMT (1454 HKT)

Lien (right) is greeted by fan

BEIJING, China -- Taiwan's main opposition leader has called for the "building of a bridge" between the self-governed island and Beijing during a controversial visit to mainland China.

Speaking to students at Peking University Friday, Lien Chen said the people of Taiwan and mainland China needed to be reunited.

Lien made his speech just hours ahead of a highly-anticipated meeting with China's president Hu Jintao, the first between the two rivals in half a century.

That meeting will cap an historic reconciliation between Lien's Nationalist Party and the Chinese government.

Beijing regards Taiwan as its territory and has threatened to attack if the self-ruled island tries to make its independence permanent.

The Nationalist Party and the Chinese Communist Party have been bitter enemies since China's civil war, when Mao Zedong's Communists defeated the Nationalists.

The Nationalist Party has been traditionally pro-independence, but Lien's visit marks a significant departure from the party's earlier stance.

Speaking to the students, Lien called for the two sides to "build a bridge to unite our people."

"This is something that our people will welcome because we want to avoid confrontation across the Taiwan Strait and our people would like to see dialogue and reconciliation and cooperation," Lien said.

"We can't stay in the past forever".

Lien said recent Chinese reforms, including nonpartisan elections to village-level posts, were closing the political gap between the communist mainland and democratic Taiwan, The Associated Press reported

On Thursday, President Hu called Lien's visit a "big event" in China-Taiwan relations.

Speaking during a visit to Manila, Hu said Lien's "journey of peace will definitely achieve a success," the official Xinhua News Agency reported.

Friday's meeting is the first of its kind since Nationalist leader Chiang Kai-shek and Mao Zedong met in 1945.

Lien said Thursday he hoped the meeting would end decades of hostilities between the two.

"I want to meet China's leaders and start a dialogue with them on the most important issues in cross-Straits relations ... peace, and economic and cultural exchanges," said Lien.

While Taiwan's opposition leader is being feted in Beijing during his eight-day trip, Taipei airport was turned into a battleground when he left as opponents and supporters of independence for the island scuffled with each other and police.

Critics set off firecrackers and fought with police, denouncing Lien for kowtowing to Beijing as political tensions within Taiwan remain high over how to deal with China.

Opponents fear Lien's visit will undermine Taiwan's hopes for remaining separate from the Communist mainland.

For their part, Lien's supporters have argued the trip will ease tensions between Taipei and Beijing -- tensions that have increased in recent months following China's passage of a law allowing it to use force to prevent Taiwan from becoming independent.

For Taiwan's President Chen Shui-bian, Lien's visit is a major political embarrassment.

Chen, who been in office for five years, won reelection in a bitterly contested campaign battle against Lien last year.

On Thursday Chen registered his criticism of Beijing back home in Taipei.

Taiwan's president criticized China's "one country, two systems" policy in a speech before members of the Taiwanese association of Macau and Hong Kong.

Beijing introduced the plan as it negotiated the eventual handover of Hong Kong from British control.

Chen also dismissed Beijing's controversial anti-secession law that gives a legal basis for military action if Taiwan seeks independence from the mainland.

Beijing has refused to deal with Chen because of his pro-independence views and many observers believe China's invitation to Lien is part of an effort to isolate Chen and send a signal to the people of Taiwan that only politicians with a softer line on China can make progress with Beijing.

But whatever Lien achieves in his China visit he will have to sell it to Taiwan's people, who remain deeply divided over how the island should deal with its giant communist neighbor.

8:03 PM - Apr. 29, 2005 - comments {0} - post comment

Lien arrives in Beijing for talks

Lien arrives in Beijing for talks

Thursday, April 28, 2005 Posted: 2:04 AM EDT (0604 GMT)

Lien arrives with his wife in Beijing.

BEIJING, China (AP) -- The leader of Taiwan's opposition Nationalist Party arrived Thursday in Beijing to meet Chinese President Hu Jintao in the highest-level contact in six decades between groups whose civil war split China in 1949.

Lien Chan's visit caps a reconciliation between the Nationalists and their former communist enemies. The two sides have united in opposition to activists who want Taiwan, which Beijing claims as its territory, to make its de facto independence permanent.

Lien was scheduled to meet Friday with Hu, who is leader of China's ruling Communist Party.

"We all want to have a peaceful, win-win future through a peaceful resolution and dialogue. It's the common aspiration for people on both sides of the (Taiwan) strait and a common historic responsibility," Lien said on the runway at the Beijing airport after being greeted by a delegation that included about 70 schoolchildren chanting "Welcome! Welcome!"

The visit comes amid efforts by Beijing to isolate Taiwanese President Chen Shui-bian, whose party favors independence, by forging ties with parties such as Lien's that support unification.

Lien arrived in Beijing from the eastern city of Nanjing, where his eight-day mainland tour began Tuesday. Nanjing was China's capital when the Nationalists ruled the country before fleeing to Taiwan after losing a civil war to the communists.

The highest-ranking Chinese official on hand to welcome him was Chen Yunlin, director of the Communist Party's Taiwan Work Office.

Lien said he hoped to "exchange ideas on the peaceful issues of trade and cultural communication" with Hu and other Chinese leaders.

Lien is the most prominent Taiwanese figure to visit the mainland since the two sides split in 1949.

Lien says he hopes to ease tensions with Beijing, which has no official relations with Taiwan and has threatened to attack if the island pursues formal independence. In March, China's legislature enacted an anti-secession authorizing military action.

Taiwan is a major potential flashpoint in Asia. Though the United States has no official ties with Taiwan, it is the island's main arms supplier and could be drawn into any conflict.

The United States said it welcomed contacts like Lien's visit but called on Beijing to talk directly to Chen's government.

"We hope that this is the start of Beijing finding new ways to reach out to President Chen and his cabinet, because any long-term solution can only be found if Beijing negotiates with the duly-elected leadership in Taiwan," said White House spokesman Scott McClellan.

Leaders of the two parties last met in 1945, when Nationalist dictator Chiang Kai-shek and Mao Zedong, then a communist guerrilla, tried to negotiate a government of national unity following World War II.

Those talks failed and after a four-year civil war, the Nationalists were forced from power.

Lien's party ruled Taiwan for five decades until being voted out of power in 2000.

Taiwan barred contact with the mainland for decades, but began to ease those limits in the early 1990s. Since then, Taiwanese businesses have invested some US$100 billion in China.

Analysts disagree on whether Lien's trip will help ease China-Taiwan tensions. Some say the former vice president and foreign minister can win Beijing's trust. Others say Chinese leaders are using Lien to widen the schisms in Taiwanese society.

Chen's Democratic Progressive Party had criticized Lien's visit and an earlier trip to China by a Nationalist vice chairman.

However, Chen on Monday gave the trip his blessing after discussing it with Lien in a phone conversation.

2:26 AM - Apr. 29, 2005 - comments {0} - post comment

Putting up the barricades

America's Congress is taking a harsher line on trade, particularly with China. The Bush administration is also getting into the act, with the treasury secretary and even the newly nominated trade representative talking tough. Is America turning protectionist?

THESE are not happy times for the dwindling band of free-traders in Washington, DC. Trade sceptics are on the move on two fronts: raising the barricades against the Chinese and refusing to lower them for the Central Americans.

Politicians blame China and its fixed exchange-rate regime for America's trade deficit. But Congress is also sceptical about the Central American Free Trade Agreement. Although CAFTA is small beans in economic terms, failure to get it through would spell ill for any global trade deal at the World Trade Organisation (WTO).

China-bashing has captured the headlines. On April 6th, 67 senators voted against dumping a bill proposed by Charles Schumer, a Democrat from New York, that would impose a 27.5% tariff on all goods from China unless Beijing adjusted its currency—which is fixed to the dollar at an artificially low exchange rate—within six months. Not only is the legislation utterly against WTO rules, it would cause havoc for the American economy. But Mr Schumer has been promised a vote by July, and his bill may well pass the Senate.

The Schumer bill's success, which has surprised even its sponsor, is accelerating other measures. Two more senators, Susan Collins and Evan Bayh, are touting the Stopping Overseas Subsidies Act, which would allow American firms to get countervailing duties to make up for Chinese subsidies, including a subsidised exchange rate. China is not currently subject to America's anti-subsidy law as it is deemed a “non-market economy” (which makes it easier for American firms to file anti-dumping cases against it). But declaring China a market economy for the purposes of subsidies, and a non-market economy for the purposes of anti-dumping, is against WTO rules.

Nobody in Congress, alas, seems to care about breaking WTO rules. The aim is to be seen to be bashing China loudly. Mr Bayh is holding up the confirmation of Rob Portman, the Ohio congressman whom George Bush has nominated for US trade representative, until his bill is voted on. Meanwhile, in the House of Representatives, Duncan Hunter, a conservative Republican, and Tim Ryan, a Democrat, have cooked up a law that allows American companies to use “exchange-rate manipulation” as a reason for demanding protection under America's trade laws. And the Congressional China Currency Action Coalition has filed a Section 301 petition asking the Bush administration to file a formal case to the WTO complaining about the yuan.

In the 1980s, a rising trade deficit—at that time with Japan—fuelled protectionist pressure in Congress. Ronald Reagan introduced the notorious “voluntary export restraints” on Japanese steel and cars. The Reagan team also abandoned its laisser-faire attitude to currency markets and, through the Plaza Agreement, engineered a sharp drop in the dollar.

The current bout of China-bashing is not a replay of the 1980s. Back then, large American firms, particularly the Detroit car giants, led the clamour for protection. Now big business, which relies heavily on Chinese inputs, is quieter. The shouting comes from smaller American suppliers. And even the noisier business groups, such as the National Association of Manufacturers, are relatively nuanced. Though the NAM wants Beijing to revalue the yuan, it does not support the Schumer bill.

Less encouragingly, the political and economic risks are bigger this time round. In the 1980s Japan, for all its faults, was always viewed as a democratic ally in Asia. By contrast, China is now seen as a nasty communist regime and a dangerous rival. In the mid-1980s, America's current-account deficit was smaller, 3.5% of GDP in 1985 compared with 6.3% today, and its debt stock lower. Today, America is the world's biggest debtor, with China as an important creditor. A sharp reversal in China's appetite for American Treasury bonds could send interest rates soaring.

This might come sooner rather than later, according to Alan Greenspan, the chairman of the Federal Reserve. In testimony before the Senate budget committee last week, he stated that the Chinese government’s massive exchange-rate interventions were causing growing imbalances in the domestic economy that will force China to abandon its currency peg. Over the weekend, the head of China's central bank also gave a speech indicating that the yuan could be revalued in the near future (though he blamed international pressure, rather than internal imbalances). Once this happens, the People's Bank of China can stop stockpiling dollar reserves—meaning its demand for American government securities will also dry up. Critics wonder if Congress, which has made little effort to curb America’s soaring budget deficits, has quite thought things through.

For now, the Bush administration seems to be trying to muddle along. It has increased its rhetoric about the need for China to fix its exchange rate. It said this at the G7 meeting of finance ministers on April 16th, and, when the Treasury issues its twice-yearly report on currencies later this month, it is likely to come close to calling China a “currency manipulator”—a term last applied to Beijing in 1994. Even Mr Portman, an ardent free-trader, sounded a harsh note on China during an appearance before the Senate finance committee on April 21st. Saying that the Chinese “do not always play by the rules”, he promised to take a firmer stance than his predecessor, Robert Zoellick. This seems to have garnered approval on both sides of the aisle—though not from Mr Bayh, who said that words were no substitute for action.

The Bush team hopes to keep this sort of grandstanding to a minimum. But the China-bashing in Congress presents a danger. At worst, this frenzy could result in a series of illegal (in WTO terms at least) protectionist bills becoming law. Even if things do not get that far, the China effect will complicate an already tough struggle to get CAFTA through.

Aside from a handful of passionate free-traders, Democrats are solidly opposed to the Central American trade deal, thanks largely to a massive lobbying campaign by the unions. The unions believe (correctly) that if CAFTA is defeated, Mr Bush's trade agenda will lie in tatters. In the face of determined union opposition, Mr Bush is already having trouble persuading many Democrats. Alarmist news about imports from China makes this task much harder.

Another set of CAFTA sceptics—the textile lobby—ought to be brought on board by fears of China. The Central American agreement is in part a way of staving off Chinese textile imports, which have surged since the quota regime ended this January. Without CAFTA, Central America's textile industry is likely to be decimated by Chinese competition. With the special duty-free access that CAFTA grants, Central American textile firms—and the American companies that supply them with material—may survive.

The Bush team is busy making this argument to textile groups. But the opposition against free trade of any sort in hard-hit textile states like the Carolinas is considerable (see article). The White House is thus getting more overt with its bribes, such as its decision to consider safeguard quotas against Chinese imports for several textile products. (The European Union said on April 22nd that it is mulling similar restrictions.)

Another powerful southern lobby, the sugar industry, is proving even harder to placate. Outrageous import quotas keep the domestic price of sugar at double that of the world price. CAFTA would allow more imports in from Central American countries, but still less than 2% of US sugar production. For the sugar lobby—and the 15 or so Republican politicians who follow its bidding—that is still too much.

The betting is that, with enough presidential involvement and vote-buying, Mr Bush may get CAFTA through in the next couple of months. Until he does, there will be little appetite in the White House to give the China-bashing in Congress the cold shoulder that it deserves.

Here
 

1:22 AM - Apr. 28, 2005 - comments {0} - post comment

Taiwan warns Lien over China deals

1:51 PM - Apr. 27, 2005 - comments {0} - post comment