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SEPTEMBER 22, 2003
How Long Will Beijing Keep Playing It Cool on Taiwan? Tung Chee-hwa, the Beijing-selected chief executive of Hong Kong, surprised the former British colony on Sept. 5 by withdrawing controversial anti-sedition legislation that he and Chinese leaders had been promoting for months. The move marks a triumph for the 500,000 protesters who demonstrated against the bill in the city's streets in July. Yet the backdown in Hong Kong comes just as Taiwan is entering its presidential election season. In past elections, China has fired missiles and held war games to scare voters away from anti-Beijing candidates, which has often backfired as Taiwanese voters rallied around politicians Beijing disliked. This time, the Chinese regime seems to want to avoid such a backlash. That may be one reason why China's inexperienced new President, Hu Jintao, allowed Tung to pull the anti-sedition bill. The Chinese leadership does not want to give any more ammunition to Taiwanese President Chen Shui-bian, the Beijing critic who has used Hong Kong's civil-rights battle to win support for his reelection bid next March. Chen is leader of the Democratic Progressive Party, long identified with the movement to declare Taiwan independent. Beijing has also responded mildly to recent provocative moves by Taiwan. On Sept. 1, Chen's government for the first time issued passports with the word "Taiwan" printed on them rather than just the official "Republic of China" that preserves the idea that the island remains part of China. A few days later, 100,000 people demonstrated in Taipei, calling for the government to drop the China name altogether, in an event led by ex-Taiwan President Lee Teng-hui -- one of the pols China loves to hate. Normally, such moves would inspire a vitriolic response, but so far the Chinese have ratcheted down their rhetoric. "Hu Jintao is still working to consolidate his position," explains John Chang, a fellow at Taiwan Research Institute, a Taipei think tank. "The timing would not be good for him to do anything big." The question is, how long Beijing will stay on its best behavior? Chen was elected with just a plurality in a three-man race in 2000 and has since presided over an economic slump. He is not popular and faces a unified opposition. So he may push the envelope in an attempt to get a clumsy Chinese response and thereby rally voters to him. Lee used such tactics in 1996, when the Chinese fired missiles near Taiwan. The Chinese may also find it hard to stay silent as policymakers in Taiwan and the U.S. urge a response to Beijing's military threat. The Pentagon recently reported that China had at least 450 missiles pointed at Taiwan and was adding 75 a year. "There is no question that [China] has decided to step up its capabilities," says Douglas H. Paal, director of the American Institute in Taiwan and de facto U.S. ambassador. Some Taiwanese want missiles capable of hitting Shanghai. "They threaten me, I need the ability to threaten them," says Li Wen-chong, a DPP legislator. Chen will have to walk a fine line. Aware that Taiwan's high-tech companies depend on Chinese factories for production, Chen's government recently issued proposals to improve economic ties with China. "Taiwan needs to maintain a steady course and not antagonize the 800-pound gorilla," says Alexander Huang, vice-chairman of Chen's Mainland Affairs Council. Still, come election time in Taiwan, leaders in Taipei, Beijing, and Washington will again struggle to keep their cool.  By Bruce Einhorn in Taipei Edited by Rose Brady Get BusinessWeek directly on your desktop with our RSS feeds.  Add BusinessWeek news to your Web site with our headline feed. Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video. To subscribe online to BusinessWeek magazine, please click here. Learn more, go to the BusinessWeekOnline home page  | | |
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