Vol. 2, Issue 1
Global Taiwan Brief – Volume 2, Issue 1
Shuffling at PRC’s Taiwan Affairs Office?
By: Russell Hsiao
Geopolitical Considerations for Taiwan’s Arms Exports
By: David An
Taiwan Strait Crisis of 1995-1996: Lessons Learned for Policy
By: Shirley Kan
Shuffling at PRC’s Taiwan Affairs Office?
Russell Hsiao is the Executive Director of the Global Taiwan Institute and the Editor-in-Chief of the Global Taiwan Brief.
In the last week of 2016, the Chinese-language media began buzzing about the possibility of a significant change in the Taiwan policy apparatus within the People’s Republic of China (PRC). According to one report in the Taiwanese media outlet Wealth Magazine (財訊), the head of the PRC State Council’s Taiwan Affairs Office (TAO), Zhang Zhijun (張志軍), may soon be replaced by Shanghai Municipal Committee United Front Work Department Director Sha Hailin (沙海林).
The alleged personnel change will reportedly take place before an upcoming meeting of the CCP Central Committee’s Taiwan Affairs Leading Small Group (TALSG; 中共中央台灣工作領導小組會議) in February 2017, after the lunar new year. The TALSG is the supreme policymaking body in the PRC’s party-led system that designs and spearheads policies government wide.
Zhang has held the office of TAO director since 2013. He replaced Wang Yi (王毅), who now serves as foreign minister. Wang was in his post as head of TAO for five years between 2008 and 2013; his immediate predecessor, Chen Yunlin (陳雲林), served in the position from 1997 to 2008. If Zhang is indeed replaced in February, he would be one of the shortest-serving directors to hold the title, second only to the first director, Ding Guangen (丁關根), who served for just two years (1988 to 1990) before becoming head of the CCP Central Committee’s United Front Work Department (中共中央統戰部). Not yet at retirement age (he is currently 63 years old), the reports were not clear about where Zhang will be reassigned if he is, in fact, removed.
Prior to his post at TAO, Zhang worked his way up the bureaus of the CCP Central Committee’s International Liaison Department (中共中央對外聯絡部)—which serves both policy formulation and intelligence functions for the Party—ending up as Vice Minister for Foreign Affairs from 2008-2013, before being assigned to lead the implementation of Xi’s Taiwan policy.
Taiwan is a core issue for the CCP. At a November 2016 meeting with the leader of Taiwan’s Nationalist Party (KMT), Xi Jinping reportedly told the visiting chairwoman that “The Communist Party would be overthrown by the people if the pro-independence issue was not dealt with.” This is also a critical year for Xi since there will be a power transition taking place during the 19th Party Congress in the fall. Many experts see the Party Congress as a test of Xi’s expanding grip on power, and replacing the head of the TAO—which is in charge of implementing Taiwan policy set by the TALSG—may be seen as an attempt for Xi to exert more control in redirecting its failing Taiwan policy. Sha is considered part of Xi’s inner circle.
In the speculative fervor leading up to his reign, Xi was considered among the Chinese leaders who “know Taiwan [faction]” (知台派), due in part to his long background in Fujian (1985-2002) and as party chief of Shanghai and Zhejiang, an identity that perhaps portended an “opening up” in the PRC’s irredentist Taiwan policy. Yet, Xi’s administration has overseen a hardening of the PRC’s positions on Taiwan, which has led to a widening disconnect between the people of Taiwan and the Beijing government.
Unlike Zhang, Sha will already be a known quantity in Taiwan if he becomes the TAO director. Most recently, Sha was sent as Shanghai’s representative to the annual Taipei-Shanghai Forum last August, which is typically hosted by the mayors of the two cities. As the former PRC Ambassador to Ireland and trained under the United Front Work Department system, Sha is a seasoned diplomat and steeped in the tradecraft of political warfare work.
Since 2012, Sha has been in charge of United Front operations in Shanghai, a city with the largest population of people from Taiwan working and living in the PRC. In 2010, there were reportedly 700,000 people from Taiwan living in the city alone (this is not including the migrant business community). During his speech at the Taipei-Shanghai Forum, Sha noted that around 550 Taiwanese work in Shanghai’s high-tech sector, high schools and hospitals; around 2,200 Taiwanese students enroll in Shanghai universities and high schools every year; and around 30,000 Taiwanese started businesses in Shanghai in 2016.
Whether or not reports of the personnel change are true, the Party leadership will be loathe to admit that its Taiwan policy has failed in spite of the many clear signals pointing in this direction. While it has long been known that Beijing’s formula for unification under “one country, two systems” （一國兩制）is completely unacceptable to the people of Taiwan, the Xi administration continues to insist on it as the only model. The need for a change in the PRC’s approach to Taiwan should have been clear in the aftermath of the student-led Sunflower movement in March 2014 and, ultimately, with the landslide defeat of the Nationalist Party in Taiwan’s 2016 presidential and legislative elections. Yet, possibly appointing someone steeped in the united front system will likely raise more questions about Beijing’s motives.
There are signs that the PRC may be considering alternative approaches to Taiwan. The Chinese Academy of Social Sciences’ (CASS) Institute of Taiwan Studies (中國社會科學院台灣研究所)—reportedly staffed and funded by the Ministry of State Security—has been headed for a decade by Yu Keli (余克禮), who was replaced in 2013, ostensibly due to his reaching retirement age. The new head, Zhou Zhihuai (周志懷), attended a cross-Strait dialogue in late November 2016 in Guangxi, and stated that Beijing, “does not oppose the idea of the 1992 consensus being substituted by a creative alternative.” It remains to be seen if Zhou’s statement signals a genuine offer from Beijing to discuss alternative formulas in the PRC’s Taiwan policy. In any case, whether or not a change in personnel will take place, it behooves Beijing’s leaders to unfreeze dialogues with the Tsai government and update its irredentist policy towards Taiwan for the 21st century.
The main point: Whether or not a change in personnel will take place, it behooves the leaders in Beijing to change its policy towards Taiwan.
Correction: The earlier version of this article omitted Xi Jinping’s long tenure in Fujian.
Geopolitical Considerations for Taiwan’s Arms Exports
David An is a Senior Research Fellow at the Global Taiwan Institute. He was previously a political military officer at the US State Department.
In this series, I have outlined a model for Taiwan’s defense industry, discussed which specific countries would buy weapons from Taiwan, and delineated what Taiwan could sell to these countries. This final article in the series addresses Taiwan’s new geopolitical considerations as it expands arms sales abroad. Becoming an exporter of military platforms is a high-stakes political decision, and Taiwan would bear some responsibility for how its weapons platforms are used by others. For these reasons, it behooves Taiwan to continue to develop and refine its arms export policy and decision-making process; below, I make several recommendations based on US arms export policy.
As Taiwan moves forward with plans to export its indigenously-produced military platforms, its policymakers and diplomats will gradually become more sophisticated in their geopolitical considerations regarding the impact of their arms sales. They will face new situations and challenges that have not arisen in the past, and will thus take on greater responsibilities as geopolitical analysts. If conventional weapons fall into the wrong hands, they can exacerbate international tensions, foster instability abroad, inflict damage, enable transnational crime, be used to violate universal human rights, and more. As Taiwan refines its own arms transfer policies, it may refer to US laws and policies, particularly the Arms Export Control Act (AECA), the International Traffic in Arms Regulations (ITAR), Conventional Arms Transfer policy (CAT) (US Presidential Policy Decision 27 of 2014), and others.
The United States’ policy guides arms sales decisions regarding the recipient country and region. The general principles for arms sales decision making include the importance of promoting regional stability and peaceful conflict resolution; preventing arms races in the region; preventing international terrorism; not causing an outbreak in conflict; determining if a sale will affect the relative military strengths of other countries in the region; determining whether the recipient country’s military is well-trained enough to effectively use the defense articles; assessing the recipient country’s capability, with regard to preventing the unauthorized transfer of technology; determining the risk of significant change in the political or security situation in a recipient country; and understanding the likelihood that recipient will use the arms to commit human rights abuses. If Taiwan exports arms to a recipient who violates any these principles, it would be wise to cease the transfer. If chances are high that exported arms will be used in a civil war, or cause an arms race overseas, then would be wise to refrain from the transfer. The consequences of starting a distant war or allowing others to misuse equipment will not be worth the profit.
There are also considerations for Taiwan as the seller. Arms sales should not negatively affect the selling country’s military stocks and preparedness, and they should be in the seller’s national interest. It is important to determine whether the sale to the recipient would impact the seller’s relations with other countries in the region. If Taiwan is planning a sale that would violate these principles, then it would be in Taiwan’s direct national interests to cease the transfer.
It is in the interests of the international community to prevent nuclear proliferation. Nuclear non-proliferation considerations include both weapons-grade nuclear materials (which Taiwan does not possess), but also aerospace items such as missiles that could be used as delivery vehicles for nuclear warheads. For instance, consider Missile Technology Control Regime restrictions on long-range missiles and space vehicles. Essentially, it would be wise to refrain from exporting long-range missiles capable of traveling over 300 km. Technology related to satellites and space launch vehicles should be more carefully protected. In addition, conventional arms transfers should not hinder negotiation of arms controls.
While Taiwan references these US law and policies, it should keep in mind that they have built-in checks and balances in the United States. Congress is legally required to provide oversight of the Executive branch. and authority for arms sales decisions is centralized in the State Department, not the Department of Defense. In addition to equipment, the decision to export defense services and technical data must also be approved under the State Department’s International Traffic in Arms Regulations (ITAR). Furthermore, the Executive branch must notify Congress before announcing a sale if the item is considered major defense equipment (MDE) and the sale is over US$14 million, or is considered regular defense articles (not MDE), but is over US$50 million, or worth over US$200 million, including design or construction services. These checks and balances ensure that arms sales decisions are the result of an all-of-government approach, rather than in the interest of one specific department within the government.
Taiwan can reference these US policies as an example of how to make arms sales decisions while trying to minimize geopolitical repercussions. If Taiwan decides to export weapons to countries that do not fit AECA, ITAR, or CAT guidelines, and the recipient country uses those weapons in aggressive or illegitimate ways, the international community may assign some level of blame, , causing Taiwan to incur reputational costs.. This type of profit will come with heavy political and moral costs.
Before deciding to become an arms exporter, Taiwan officials should carefully consider China’s views and the opinions of its neighbors, and consult with the United States as it moves forward in this direction. Cross-strait relations have a direct impact on Taiwan’s politics and future, so it is important to consider how China would react. In addition, the United States may end up helping Taiwan—like when it sent two aircraft carrier battle groups near Taiwan during the Third Taiwan Strait Crisis in 1995 and 1996 —so it is important to consult with the US government on sensitive matters such as Taiwan’s plans to export arms. Taiwan should also consider the opinions of neighbors in the region such as Japan, South Korea, and Australia, since they are in a military alliance with the United States and would possibly play a role in working with Taiwan in a military contingency.
In addition, as Taiwan moves in the direction of developing weapons for export, there is a new dilemma that will strain its relations with its closest international partners. The dilemma is whether to save money by reverse engineering advanced technology to sell overseas, or to forego that extra profit. The temptation to copy, sell and profit will be strong. It is much cheaper to copy than to invest the high research and development costs required when starting from scratch or building on one’s own proprietary technology. As this new incentive arises, and even if a government is decisive about not copying and selling another country’s defense technology, private companies could still try to do it. It will take vigilant Legislative Yuan government oversight of the Executive Yuan, oversight of other government-affiliated organizations, and keeping private companies in check to resist this pressure, since violating intellectual and property rights will ultimately lead to strained relationships with major powers that sell advanced military technology to Taiwan.
In conclusion, through this series of articles on Taiwan’s defense, I have covered the supply side (what to sell) of Taiwan’s export-oriented defense industry, demand side (who will buy), how to organize this growing industry, and new policy considerations. There is still much to consider, such as how to establish leadership at all levels to oversee defense projects, how to delegate responsibilities, ensure projects are completed on time and within budget, and the hard question of how to draw top talent from overseas back to Taiwan with constrained budgets. These answers will come through trial and error at each step of the way, and through extensive consultation with industry and policy experts in Taiwan and abroad.
The main point: As Taiwan pursues arms exports, it should continue to refine its laws and policies, so that they protect Taiwan’s interests, preserve peace for the recipient country, and encourage regional stability, using the United States’ AECA, ITAR, and CAT arms export laws and policies as points of reference.
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(D)(i) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(D)(ii) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(D)(iii) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(I) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(J) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(F) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(G)(ii) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(L)(ii) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(1)(D)(iv) (2014).
 Arms Export Control Act, Public Law 90–629 § 36(b)(5)(C)(ii) (2014).
 Chi Su, Taiwan’s Relations with Mainland China: A Tail Wagging Two Dogs (New York: Routledge, 2008),14.
Taiwan Strait Crisis of 1995-1996: Lessons Learned for Policy
Shirley Kan, retired specialist in Asian security affairs who worked for the US Congress at the non-partisan Congressional Research Service (CRS) and a member of the Advisory Board of GTI.
After the phone call on December 2, 2016, when Taiwan President Tsai Ing-wen congratulated President-elect Donald Trump, mainstream media and analysts sounded the alarms and invoked the Taiwan Strait Crisis of 1995-1996 to raise the specter of tension due to “provocations” from Taipei and Washington that “surprised” Beijing so it had to respond.
There are the typical references to US “mishandling” of the “visa fight” for Taiwan President Lee Teng-hui’s 1995 visit that resulted in that “missile” crisis. In this conventional narrative, the problematic parties are the US politicians and Taiwan’s president who push to change policy and thus “trigger” a crisis that upsets the “status quo” with China. A visa supposedly led to ballistic missiles and aircraft carriers.
However, a key lesson learned is that this conventional assumption does not serve US and allied interests in maintaining peace and stability. An informed narrative would dispel dangerous misperceptions and counter China’s political warfare that justifies its threats by blaming the United States or Taiwan (for a visa or call).
According to the conventional assumption, Congressional pressure forced the reversal of President Clinton’s decision that ultimately granted a visa to President Lee to speak at his alma mater, Cornell University. Giving the visa was an adjustment in policy, because, in May 1994, President Clinton allowed Lee to make only a “refueling stop” for “rest” in Honolulu’s airport but denied him a visa. Congress then overwhelmingly passed the bipartisan H.Con.Res. 53, but it was nonbinding legislation to express the sense of Congress that the President should welcome a visit by Lee to Cornell.
Yet, Beijing did not so-call “respond” to a mishandling of a visa by Washington that was manipulated by Taipei. China’s rulers already had decided by 1993 on a new Main Strategic Direction（主要戰略方向) to build military capabilities oriented to target Taiwan.As signals of this critical decision, China’s leadership used especially harsh, belligerent language in warnings to Taiwan in 1992 and 1993. Moreover, in January 1993, Central Military Commission (CMC) Chairman Jiang Zemin gave a speech that directed the new “Military Strategic Guidelines for the New Period” (新時期軍事戰略方針). The Guidelines apparently oriented the People’s Liberation Army (PLA)’s Main Strategic Direction to the area off China’s east coast, primarily Taiwan. In 1993, China issued a White Paper on Taiwan that explicitly cited the use of military options.
The PLA’s threat to Taiwan has grown since the early 1990s. China did not suddenly decide to order PLA exercises in 1995 to intimidate Taiwan as a so-called “response” to Lee’s visit to the United States. Nonetheless, the timing of military exercises in 1995-1996 also served objectives in political warfare against the United States and against voters in Taiwan’s first direct, democratic presidential election.
Also, the PLA did not suddenly get M-9 missiles to threaten Taiwan after Lee visited the US On June 12, 1995, just three days after Lee’s speech at Cornell, there was a warning that the PLA would use missiles. As an important indicator of this provocative move, the Liberation Army Daily published an article on the utility of “conventional” ballistic missiles. On top of high-level orders to the PLA, it had the opportunity of using an inventory of M-9 short-range ballistic missiles after China canceled a sale of the missiles to Syria due to US diplomatic pressure and sanctions since the late 1980s. In the early 1990s, China promised to abide by the international Missile Technology Control Regime (MTCR).
Thus, the PLA did not plan, deploy units, and execute large-scale exercises with missiles under a new military strategy with multiple phases and reviews by senior-ranking generals in just months after a US visa for Lee. The extensive exercises sought to train for capabilities that the CMC directed by 1993.
What were short-term lessons for the Clinton and Bush Administrations in changing policy? First, US military and defense officials needed closer communication and cooperation with Taiwan. After the 1995-1996 crisis, the Defense Department, in 1997, started bilateral talks on national security with Taiwan’s top officials in defense and security, which also have been called the Monterey Talks. Second, the US military also needed to improve its understanding of Taiwan’s military capabilities. Starting in 1997, the Pentagon conducted its own series of assessments of Taiwan’s requirements for self-defense. Third, in 2001, the US restored observations of Taiwan’s Han Kuang exercises and approved key arms sales.
What are lessons for current consideration as Washington moves forward in crafting policy? First, clear, credible statements and actions are critical. Policymakers need to be clear about consequences and signals. The President needs to restore a clear, credible arms sales process with regular decisions and notifications to Congress of arms sales in compliance with the Taiwan Relations Act (TRA).
Second, US deterrence using shows of force has its limits in dealing with the PLA. Therefore, Taiwan needs to be stronger in deterrence and self-defense. Taiwan needs to upgrade its military with more urgency and resources in the face of China’s threats of coercion or conflict, understanding that the PLA is operationalizing the targeting of Taiwan in peacetime, not just in case of war.
Third, the President’s close consultation with Congress is critical for peace and stability in the Taiwan Strait. Fourth, in case of another crisis, the President should consult with Congress under Section 3(c) of the TRA, which requires the President to inform Congress promptly of any threat to the security or the social or economic system of the people on Taiwan and to determine the US response along with Congress. In March 1996, President Clinton refused to invoke Section 3(c).
Fifth, the United States needs closer communication with both Taiwan and China to dispel misperceptions. Washington needs to deal with dangers of divergence with Taipei. Sixth, American leadership is needed to support the democratic legitimacy of Taiwan with international space. Seventh, the United States and Taiwan should conduct exercises for crisis-management, interoperability, and training. Eighth, Taiwan should seek support from Congress, not only focusing on the President and his officials. Ninth, Taiwan needs to improve strategic communication to gain international support and to counter the PLA’s political warfare in peacetime.
Last but not least, governments and news media need the right record to replace reporting and propaganda that blames Taiwan for “trouble” and “tensions” instead of Beijing’s provocations and belligerence.
The main point: An accurate narrative dispels the blame on a visa for the Taiwan Strait Crisis. The PLA’s provocative, dangerous military exercises in 1995 and 1996 resulted from decisions made in the early 1990s. The new Trump administration has an opportunity to improve interactions with Taiwan, rather than responding belatedly in case of another crisis (like in 1995-1996) to adjust the approach to policy in order to maintain stability and peace.
 This brief article draws from the author’s longer presentation at a conference that Project 2049 Institute held on December 13, 2016, in Washington, DC, on the 20th anniversary of that Taiwan Strait Crisis.
 A classic example of the conventional narrative is found in Paul Godwin and Alice Miller’s study published by the National Defense University in 2013, China’s Forbearance Has Limits. It states: “The 1995–1996 Taiwan Strait crisis was triggered by the decision of the Clinton administration— after months of advising Beijing that it would not do so—to grant Taiwan President Lee Teng-hui a visa to visit his alma mater, Cornell University, where he had earned a Ph.D. in 1968 in agricultural economics. … In summary, Beijing deployed its warnings hierarchy at a high, authoritative level in reaction to a US reversal of policy that clearly surprised and embarrassed it. Its warnings were calculated to press Washington to reverse itself, and when that failed, it responded with political steps to express its displeasure, complemented by a prolonged series of military exercises intended to underscore its readiness to defend its sovereignty against further slight.”