The Importance Of Taiwan To Us China Relations Politics Essay

23 Mar 2015

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Does Taiwan Matter? An Analysis of the Strategic Importance of Taiwan to the U.S.-China Relations. 【Abstract】There is no doubt that the relations between People's Republic of China and the United States is crucial to the world. In economic aspect, China and America are so intertwined that their symbiotic relationship is described as 'Chimerica'; however divergence always emerges between the two on political issues, in particular, the Taiwan issue. This essay analyses the strategic importance of Taiwan to the Sino-U.S. relations by answering the question- "what role Taiwan plays in the relations of the PRC and U.S.?" and the essay covers four points: 1) Taiwan issue is at the core of this bilateral relations, 2) it is an intractable issue, 3) it is also a contentious and most potentially dangerous issue, 4) but it is not always the most important one troubling the two countries at ALL times since common economic interests between the three still exist.

【Key Words】Taiwan; China; the United States; strategic importance; U.S.-China relations; Taiwan issue; the rise of China

INTRODUCTION

There is no doubt that the relations between China (PRC)--the largest developing country and the United States--the largest developed country is crucial to the world. In economic aspect, China and America are so intertwined that their symbiotic relationship is described as 'Chimerica'; however divergence always emerge between the two on political issues, in particular, the Taiwan issue. On January 29, the U.S. pass of a $6.4 billion weapons sale to Taiwan followed China's furious response froze the bilateral relations. Does Taiwan matter? Of course, it does and it is the core issue in the Sino-U.S. relations. What role Taiwan plays and how it influences the two countries' relations? This essay will assess Taiwan's strategic importance to the U.S.-China Relations by answering those questions.

WHAT ROLE TAIWAN PLAYS IN THE U.S.-CHINA RELATIONS? --Assessing Taiwan's Strategic Importance to the U.S.-China Relations

Taiwan matters a lot to both China and the United States who have common interests but also divergence. In this part, the author analyses three roles it plays in the two countries' bilateral relations.

It is one of the core issues in the U.S.-China relations

Taiwan issue could not be avoid or overlooked as it is the central question in almost "every meeting between Chinese and American officials, in every academic gathering that includes Chinese scholars, and in many private conversations with Chinese visitors to the United States" (Halloran,2003). Why both countries attach so much importance on this issue? This section offers some explanations of why Taiwan issue lies at the core of the U.S.-China relations from the perspectives of both the PRC and the U.S..

â-The PRC: Taiwan question touches the core interests of China

The PRC never ceases its effort to reunify with Taiwan which is regarded by mainlanders as part of their sovereign territory. Following four factors amplify why Taiwan has such a strong hold on the Chinese leadership's psyche.

Taiwan's historic importance and Chinese nationalism

Taiwan is the island off mainland China's southeastern coast and was long a backwater of the Chinese empire for over a thousand years before it was colonized by Japan in 1894. When Japan surrendered in 1945, the Republic of China (ROC) acquired sovereignty over Taiwan under Cairo Declaration. Although recently, the advocates of Taiwan independence claim that the Cairo Declaration was not a legal document, and Taiwan has not been officially returned to the ROC, it is neither a part of Japan nor China, most Chinese elites still believe it is a province of China even after the Chinese Communist Party seized power and Kuomintang retreated to Taiwan in 1949. Moreover, some Chinese scholars who place great emphasis on history as "a barometer for China's future" think the reunification of Taiwan--"a former colonial possession and a relic of the Cold War"--is the strong demand of the whole Chinese nation (Thompson and Zhu, 2004). Chinese scholar Chen (2002) also notes that "it is hard for Americans, who have a shorter history than China, to appreciate... its {Taiwan} importance to the Chinese people." The view that taking Taiwan which is "the last vestige of the humiliation by Japan and the West during the colonial period" would complete the trilogy after China has reclaimed Hong Kong and Macau in 1997 and 1999 respectively is widely shared among Chinese mainlanders (Halloran, 2003; Business Monitor, 2010). And some mainlanders even see continued arms sales to Taiwan by the United States as an example of foreign powers trying to hinder China's rise as they did before.

Taiwan's political importance to the mainland

Due to a large majority of the Chinese people hope to reunify the motherland, the Chinese Communist Party (CCP) does not have any route of retreat regarding the Taiwan issue. The CCP has placed Taiwan issue at a high place on its agenda, linking the Party's success or failure to reunification. As Thompson and Zhu (2004) have noticed "no Chinese leadership group can afford to be the one who lost Taiwan" since Taiwan problem could "potentially disrupt the first peaceful, institutionalized transfer of power in China". Furthermore, the loss of Taiwan could spur dissent in other provinces with separatist tendencies, such as Xinjiang and Tibet. Thompson and Zhu further argue that "losing Taiwan could upset the regional long-term plans for incremental integration that have been relatively successful to date" and "foreign influence in Taiwan also sets a dangerous precedent for Xinjiang and Tibet". Additionally, Taiwan issue could exacerbate domestic social and political tensions, as some analysts believe that CCP plays up the Taiwan issue to divert attention from China's political struggles and social instability such as the corruption and unemployment (Halloran, 2003). In essence, Taiwan could become an excuse for dissidents and activists in China to oppose the ruling Communist Party.

Economic significance of the island

Absorbing Taiwan's "vibrant economy" and "technological prowess", especially in electronics, would be "a plus for the Chinese economy" (Halloran, 2003). China has already benefited from Taiwanese investment and trade, and the economic ties between the two are strengthened: since the mid-1980s, Taiwan companies have come to regard the mainland as their key lower-cost production platform and a potential market; for the PRC, Taiwan companies bring capital and management experience and create a lot of jobs. According to Taiwan's Ministry of Economic Affairs, more than three-quarters of Taiwan's companies have an investment on the mainland, reaching $60 billion in more than 50,000 ventures (Bush, 2002).

The island's geo-strategic importance

According to Halloran (2003), Chinese leaders see Taiwan as a crucial link in a chain of the U.S. containment that begins in South Korea and Japan and runs south through Taiwan to the Philippines, Thailand, and Australia, "nations with which the United States has security treaties". If Beijing seeks to break that chain and to project power into the Pacific, controlling Taiwan would be the best way. A similar view is shared by Thompson and Zhu (2004), as they believe that Beijing worries about the U.S.'s intention of integrating Taiwan into "a de facto alliance with Japan and South Korea to contain its rising power in Asia" since Taiwan could be used as a perfect foreign military base. Furthermore, China has become increasingly dependent on energy resources in the Middle East. In this case, a hostile or even independent Taiwan has the ability to cut off Chinese energy supply lines, and that also worries Chinese leaders.

â-U.S.: Taiwan is important to maintain its hegemony in Asia

Since the PRC puts Taiwan issue at such a high position, the United States could never ignore its importance when interacts with China. More importantly, the U.S. attaches great importance to Taiwan because the island could help to maintain its hegemony in this region.

According to a RAND (2001) report, the U.S.'s pivotal long-term objective to East Asia is to prevent a worsening of the security situation in this region. Central to this objective is to "preclude the rise of a regional or continental hegemon" that could challenge the U.S.--the current hegemon of East Asia (Khalilzad et al., 2001; Bush, 2005:255). At the moment, no nation in Asia is close to becoming a regional or continental hegemon as the U.S., but there do exist some potential rivals that could challenge the U.S.'s dominance and China is number one on the list. And the Taiwan issue which not only could be a "tool" to contain China but also could be a "bomb" to harm the region's stability attracts much of the U.S. attention. In this section, Taiwan's strategic importance to America will be further analyzed from three perspectives:

Taiwan's geo-strategic importance to the U.S.

Taiwan's geo-strategic importance lies in maintaining American hegemony in East Asia. Early in mid-1850s, on his way to Japan, Commodore of the U.S. Navy-Matthew C. Perry anchored off in Formosa, to investigate the potential of mining the coal deposits in that area. Later he emphasized in his reports that Formosa provided a convenient mid-way trade location and it was also very defensible providing a good base for exploration for America. Though his suggestion was declined by the president, his point of view that "occupying Formosa, controlling Asia" was inherited by generations of policymakers in the U.S. (Zhao, 1997; Zhou, 1995).

In the East Asian security context, Taiwan becomes the focal point of clashing strategic interests between the United States and some East Asian countries. Its geo-strategic significance arises from its "lying astride the Western Pacific sea lanes of communication (SLOCs) which run from the Straits of Malacca to Japan, South Korea and eastwards", and its being adjacent to the Taiwan Strait which "connects the South China Sea to East China Sea in the northeast"(Kapila,2006). Taiwan therefore commands the East Asia waterways and also the Chinese domestic waterway linking South China Sea to East China Sea. These waterways are the most strategic waterways in the world and witnessed competing strategic interests of super powers like U.S., Japan and former Soviet Union (Kapila, 2006).

If Taiwan were under Beijing's control, these transportation routes would become vulnerable to be interrupted by China (Tucker, 2002). In precise, occupation of Taiwan means control of the northern entrance of the South China Sea. Then, the large part of the South China Sea would become a kind of China's inner water, and which particularly worries the U.S. ally-Japan who sees the SLOCs as its lifelines. Also, as for China who once lacked deep waters on its East China Sea coastline where its important naval bases are located, it could "utilize Taiwanese ports for submarines to operate freely throughout the Western Pacific" after controlling the island (Okazaki, 2003). Furthermore, as for the United States who once views Taiwan as its "unsinkable aircraft" carrier off the coast of China (Taiwan along with Japan and the Philippines provides the outer shield of defense of mainland for the U.S.), the control of Taiwan by China seriously influences its military capability in East Asia (Kapila, 2006). In a word, Taiwan's geo-strategic location offers United States and Japan an option to block China at its gates. As Taiwan's President Chen Shui-bian once declared: "Taiwan is the key locking in China's military and preventing any westward expansion." So as U.S. ambassador to China James R. Lilley has noted that "Taiwan is the cork in China's bottle" (Tucker, 2002).

2) Taiwan's political significance

On one hand, after years of political reform and democratization, Taiwan has shifted from "hard authoritarian regime" (since 1949) to "soft authoritarian regime" (since 1970s) and finally to a "democracy" (since late 1980s) (Halbeisen and Ferdinand, 1996). And as a "vibrant democracy", in Kapila (2006)'s view, Taiwan is a "powerful alternative model" to the Communist political model of mainland China, and "a beacon and reminder of democracy for the over one billion Chinese on the mainland". Some American scholars, such as Bush (2005:246), point out that the island's democratization in the late 1980s and early 1990s "closed the gap between congressional liberals and conservatives in the U.S. over island's political system and thus created a broad and sympathetic coalition". Thus as an established democracy, Taiwan gains the U.S. congress's support as Americans feel that they must support democratic nations or it would severely undermine the U.S. position as "a defender of democracy" if "it failed to save democratic Taiwan from the invasion of authoritarian China"(Bush,2005:246).

On the other hand, if PRC controlled Taiwan, a significant change of international relations might take place in Pacific regime. Under Okazaki (2003)'s hypothesis, there would be important political impact of PRC's annexation of Taiwan on Southeast Asian countries who have vital interest in the South China Sea. Okazaki further argues that the entire control of the regional nations' "outlet to the sea" would be one of China's useful tools of "finlandizing these nations". There still exists a more important question: the overseas Chinese in Southeast Asia are now divided into "pro-Beijing", "pro-Taiwan", and "neutral groups". China's control of Taiwan would make this division which is utilized by some Southeast Asian governments to govern the oversea Chinese disappear. Also in his point of view, finlandization of Southeast Asian nations by China will undermine not only Japan's vital interests, but also the U.S.'s.

The economic importance of Taiwan

For one thing, Taiwan is one of the major buyers of the U.S. arms. Under a 1979 treaty in which the U.S. switched recognition of China to Beijing from Taipei, Washington is obliged to sell the island defensive weaponry and Beijing gets furious every time the U.S. president passed the arms sales to Taiwan. One current issue mentioned at the beginning of this essay is the announcement of the $6.4 billion U.S. arms sales package to Taiwan by president Obama and "it marks a low point of the Sino-US relations"(Cooke, 2010). According to a congressional report this year, the value of deliveries of U.S. defense articles and services to Taiwan totaled $3.7 billion in the 2001-2004 period and $3.9 billion in 2005-2008. Among customers worldwide, Taiwan ranked 3rd (behind Egypt and Saudi Arabia) in 2001-2004 and 4th (behind Israel, Egypt, and Saudi Arabia) in 2005-2008. In 2008 alone, Taiwan had agreements for arms purchases that totaled $1.3 billion from the U.S. (Kan, 2010).

For another, Taiwan--the major producer of electrical requirements and information products in the world--is one of the major suppliers of the U.S. IT industry. If China tried to control Taiwan by force, for the Western companies that have built their fortunes on the mainland or in Taiwan, the damage would be "a direct hit to the global economy and the Digital Age" (Einhorn et al., 2005).

To conclude this part, as for the PRC, Taiwan holds historic importance, both stemming from the civil war and the legacy of foreign intervention. Chinese leaders see bringing Taiwan into the PRC as a crucial step in strengthening the Chinese Communist Party's leadership in China and establishing Chinese influence over East Asia and in driving the United States from the Western Pacific. In addition, Taiwan has economic importance as it could be a plus for the Chinese economy, and it holds strategic importance, straddling sea lanes and potentially serving as a base for foreign military forces. As for the U.S., from an optimistic perspective, Taiwan could be a partner in the engagement of China and foster China to play a modest role in shaping a new structure in East Asia. If, on the other hand, the more negative scenario takes hold, the Taiwan Strait issue likely becomes the main arena for the contest between the U.S. and China for supremacy in Asia. Therefore, the U.S. also attaches great importance on Taiwan.

It is one of the most difficult issues to solve in the U.S.-China relations

The Taiwan problem has been existing since the founding of the PRC, and it has always been the single most important and sensitive issue at the core of China-U.S. relations and it will still be one of the most intractable issues in the bilateral relations. The reasons for this can be perceived in three factors: firstly, the PRC will never cease the effort to reunify Taiwan since it is its core interest as mentioned in last section. The pass of the Anti-Secession Law in 2005 shows Beijing's resolution; but, secondly, as for Taiwan, a sense of Taiwanese identity or Taiwanese nationalism is increasing among new generations, which might result in a strong demand for independence; lastly, the U.S.'s strategic ambiguity which turned out to be quite successful in maintaining the stability of the Taiwan Strait for the most part of last century, has become the major cause of some Taiwan leaders' aggressive actions that threaten the peace of the region. The following section will focus on the last two factors:

â-Taiwan's rising Taiwanese nationalism

After more than half a century of self rule and democratic evolution, popular support for political reunification among the islanders is declining, and the proportion of Taiwan residents who think of themselves as Taiwanese (not Chinese) is increasing. Copper (1999:116) explains this phenomenon by saying that, in the twentieth century, "Taiwan was part of China for only four years"... therefore "in terms of its economy, society and political system, the gap is growing larger... [and] divergence...is the trend". Rigger (2006:4, 57) calls this phenomenon "the rise of Taiwanese nationalism" which means the "islanders' lose of their sense of connection to mainland China" and "their growing tendency to identify Taiwan as their homeland."And this is assumed to be particularly common among young Taiwanese. Some current surveys on "Taiwanese nationalism" also indicate that there is a rising proportion (nine out of ten) of Taiwan residents who call themselves Taiwanese as opposed to Chinese. However two decades ago, surveys show that an overwhelming majority of Taiwan residents called themselves Chinese, while this percentage fell sharply during the 1990s (Rigger,2006:4,6).

Because Taiwan is a democracy, the profound shift in public opinion on the island of 23million could seriously influence the decision of its government. Therefore, a more assertive posture of its authority--even a declaration of independence--if that is what the voters demanded could be possible. For example, Taiwan's former President Chen Shui-bian's Democratic Progressive Party has long advocated Taiwan's independence. Even the pro-unification Kuomintang has muted at that point since it could not resist the opinion of the majority Taiwan residents; it began to regard independence as one of the possible future for Taiwan. And Taiwanese nationalism has become the focus of so much anxiety in Beijing and Washington because for Beijing, it means its reunification course is more difficult; and as for Washington, the more provocative actions of Taiwan seriously challenge the relatively stable status quo of Taiwan Strait.

â-U.S.'s strategic ambiguity

"Strategic ambiguity" marked American policy which is "intended to keep Beijing and Taipei guessing about how the United States would respond to hostilities across the Taiwan Strait" (Halloran, 2003). The essence of this concept is that the U.S. does not state explicitly whether it will come to Taiwan's defense in the event of an attack by the PRC. The uncertainty about U.S. intentions shapes the intentions of the other two actors: it constraints China from making an unprovoked attack by raising the possibility that Washington will intervene, and it constrains Taiwan from taking provocative steps by suggesting that Washington would not intervene (Bush,2005:256;257).

However, ambiguity was sometimes a tool for ensuring dual deterrence but sometimes an obstacle. As Yang (2004) has stated that the "self-contradictory U.S. dual policy" is the major cause of Chen Shui-bian and his aggressive action of pushing Taiwan farther and farther to independence during the Bush administration.

Two reasons may explain the adoption of this "strategic ambiguity" policy by the U.S.: first is the contending views in the U.S. toward China. As stated by Halloran (2004), there are four schools among U.S. decision makers: panda huggers who assert that "America must accommodate China's emerging power, even at the expense of Taiwan's freedom"; entrepreneurs, "who pursue the age-old dream of selling toothbrushes to 1.2 billion Chinese" and most of who are care little about what happens to Taiwan; balancers who say the United States should engage and deter China at the same time and Taiwan's fate is to be determined by the Taiwanese; and demonizers who demand that "China be confronted at every turn". Therefore, when refer to the rise of China; there are contending views in the United States. On one hand, panda huggers have hoped sincerely that through economic interdependence and political engagement, the PRC will become a great power that accumulates national power not for its own sake but to use it, as the United States does, to preserve international peace and security. On the other hand, there is a growing concern in the United States represented by those balancers and demonizers (some also call them "the blue team"(Jia, 2008)), that China is accumulating power, including military power, not to serve "an internationalist agenda" but in order to make China the dominant power of East Asia, instead of the U.S., and a change of a hegemon may lead to regional instability. Further, a more powerful China will inevitably be "more assertive about its interests regardless of whether they are compatible with those of the United States" (Tucker, 2002). These different views toward China make a clear policy of the U.S. toward the Taiwan issue to be impossible.

Second reason is that ambiguity could be a retreat for the U.S. to avoid a war. Layne (2001) points out that the U.S. does not actually want to get involved in a war for defending Taiwan. Because for one thing, if Washington goes to defend Taiwan and against Beijing, it almost certainly will do so alone since its European and Asian allies "have no interest in picking a quarrel with China over Taiwan's fate". For another, by defending Taiwan, the United States runs the risk of armed confrontation with China who holds nuclear power. And it would be, as he believes, "a geopolitical act of folly for the United States to risk nuclear war with China for the purpose of defending democracy in Taiwan, which at stake simply would not justify the risks and costs of doing so".

In sum, Taiwan issue typifies the complexity of Sino-U.S. relations. Because Beijing has showed its determination of taking Taiwan back; while in Taiwan, Taiwanese nationalism is rising and it seems that the island has no intention to reunify with the mainland and will not cease its effort to be independent in short-term; and some shortcomings of U.S.'s strategic ambiguity policy are also emerging. All these factors demonstrate that an acceptable solution of Taiwan issue (here the author means the reunification or independence) is impossible in the short-term.

3. It is the most potentially dangerous issue in the U.S.-China relations

The Taiwan issue is also the most contentious problem in the bilateral relationship. Although there are quite a few disputes between the two countries--including disputes on human rights, trade imbalances, currency controls and so on--it seems that no dispute except the Taiwan issue is likely to lead to confrontation that may trigger a war between the two countries with nuclear powers. In retrospect, there were three Cross-Straits crises: namely, the 1955, 1958 Taiwan Strait Crisis and 1996 Taiwan Strait Crisis. During those crises, intimidating military exercises such as firing missiles were conducted by the PRC, and U.S. aircraft carrier groups were dispatched to the Strait. Though every time the two governments managed to handle the crises, the Taiwan Strait crises, observed by Jia(2008:49), still "highlighted the potential for military conflicts between the two countries" in the future. To some extent, the Taiwan issue is just like "a ticking time bomb" as "no one is sure when it will explode" (Chen, 2002). Its sensitivity can be further perceived from the following three aspects:

First is the increasing provocative actions of Taiwan's pro-independence, and the reason for this has mentioned in last section. The Taiwan authorities began to change their previous policy stance of reunification to an independence course when Lee Teng-hui administration was in power in 1990s (Jia, 2008). Lee's successor-Chen Shui-bian and his government has pursued even more aggressive policies, such as "de-Sinification", the once proposed "independence referendum" in the 2004 presidential election as well as "the planned constitutional revision before 2008 which tried to bolster Taiwan's independent identity in the world"(Zhang, 2008:87).These provocative actions or policies of Taiwan's leadership and policy-makers come from the belief that the United States is on its side, although these policies have invited criticism from the U.S. which sees them a potentially threat to stability in the Taiwan Strait. Rigger (2006:2) points out that the U.S. policymakers are worried about the possible misunderstanding of Taiwan's leadership toward the U.S.'s intention and its negative effect that may provoke a military response from the PRC.

Second is the PRC's incremental national defense spending and its growth military power which worry the U.S.. Taiwan problem generates security dilemma: infuriated by the U.S. arms sales to Taiwan and their joint military exercise and also worried by the increasing military power of the island, Chinese government decisively reprioritized national defense development and began to make effort to develop its military means in order to prevent independence by force if necessary, after the 16th Party Congress in 2002 (Yang, 2003). Since Beijing has stated its willingness to "pay any price" to resolve the Taiwan issue on terms favorable to Chinese interests, or at least to prevent a worsening change in the status quo, Chu and Guo (2008) suggest that the Chinese government has "made preparation for conflict over Taiwan the fundamental task for military development in the early 21st century", and to this end, "the government has increased national defense spending for now over five years."

Some Chinese strategists suggest that China has been pursuing a "systematic modernization of its strategic nuclear forces" that will enhance its "second-strike capability" versus U.S. "in the next 10 to 15 years"(Zhang, 2008:98). In particular, China has had some significant breakthroughs with its nuclear modernization in recent years, include its successful tests on the sea-based JL-2 strategic missile in 2005; the 094 Class strategic submarine launched in 2004. Zhang (2008:98) mentioned in his article that this new strategic weapon system "will increase the number of warheads capable of striking the U.S.A. from the current 20 to 30 to a much higher level." What's more, in recent Chinese discussions of the Taiwan issue, the No First Use nuclear doctrine which refers to a policy not to use nuclear weapons as a means of warfare unless first attacked by an adversary using nuclear weapons is increasingly under criticism especially from the hawks in the Chinese leadership. Many of those believe that due to its vast conventional disadvantage against the U.S., China has to rely more on its nuclear weapons to prevent American intervention in the Taiwan Strait, and China could even launch a preemptive war on this issue.

Washington has noticed these changes and has become increasingly alarmed by China's military modernization. In the Pentagon's 2006 report, the US government shows its serious concerns for both China's emerging strategic capabilities and the potential changes in China's nuclear doctrine. Also according to the last annual reports of the U.S. Department of Defense on the military power of the PRC, the U.S. thought that "China was elevating capabilities in sea, land, and air ballistic missile, space, and integrated command systems and so on", and the growth of China's military power "could pose a credible threat to other modern militaries operating in the region"(Chen Xiaodong, 2008:65).

Third, historically U.S. has intervened to protect the island, so there is a great possibility Washington will join in the conflict if a hot war happens between the PRC and Taiwan. Though its still ambiguous policy makes it unclear how the United States' response to a China-Taiwan conflict, as mentioned in last section, it is safe to predict that there would be strong "domestic political pressure in favor of American intervention" since "ideological antipathy toward China and support for a democratizing Taiwan would be powerful incentives for American intervention" (Layne,2004). One example may offer some clue for this is what the U.S. did in the 1996 Taiwan Strait Crisis: the United States displayed its resoluteness when in 1996 China fired ballistic missiles over Taiwan. The United States "immediately dispatched two aircraft carrier battle groups" into the Taiwan Strait, "forcing China to back off" (Bush, 2005). And with the rise of "the blue team" who believe the U.S. should start to contain China rather than facilitate its development in the U.S. government, it is likely that the U.S. could behave tougher when handling the Taiwan issue (Jia, 2008).

CONCLUSION

This essay analyses the strategic importance of Taiwan by answering the question--What role Taiwan plays in the Sino-U.S. relations? And it offers the answer by saying that the island has three roles in the two countries' relations--firstly, it is one of the core issues in the U.S.-China relations; secondly it is one of the most difficult issues to solve in the U.S.-China relations and last but not the least, it is the most potentially dangerous issue in the relationship.

Although the Taiwan issue is the most sensitive, divisive problem in Sino-U.S. relations, it is not necessarily the most important one troubling the two countries at ALL times. Besides differences and disputes, China and the United States still shared some common interests. For instance, in the 1970s, they shared common strategic interests against Soviet expansion. Since the end of the cold war, they have shared common interests in the maintenance of stability in the East Asia and they also promote economic cooperation (Chen, 2002). Echoing the general theme of the "extended hand" in his inaugural address, the current U.S. president Obama struck a tone of "cooperative engagement" in his initial approach to China, inviting Beijing to join Washington in "global co-leadership" in the field such as climate change and counter-terrorism (Cooke, 2010). And the recent global economic recession has also bound the two together again.

As for the relations between Taiwan and the mainland, these same "global tectonics" have been reshaping relations between the two across the Taiwan Strait. With China's emerging economy having roared back with around 10 percent projected GDP growth rate per year since 1990s, Taiwan businessmen have began to seek opportunities on the mainland. This "mainland fever" has been strengthening the economic ties between China and Taiwan for more than a decade, recently have multiplied and deepened. On Cross-Strait relations, Beijing began to be realistic enough to understand the "current political stalemate", thus it is concentrating its efforts on economic relations (Yang, 2002; Tucker, 2002; Chen Edward I-hsin, 2008).

In a word, there is an increasing trend toward closer economic and trade relations among the three parties, and there are still a lot of common interests between the PRC and the U.S. as well as between Beijing and Taipei. All these factors mentioned above indicate that putting aside divergence and focusing on their common interests, such as economy, and achieving a "win-win-win" situation among the three is possible, and therefore, from an optimistic point of view, a peaceful solution of the Taiwan problem is also possible in a foreseeable future.



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