Taipei to Shanghai, the Long Way


By Bruce Einhorn It's 5:30 a.m., and I'm already starting my trip to Shanghai from Taiwan -- for an interview at 5 p.m. Leaving at dawn for the airport might seem a little premature, even for somebody like me, who prefers to be checked in with plenty of time to spare. But I'm in Hsinchu, the high-tech capital of Taiwan southwest of Taipei, and getting to Shanghai is almost an all-day affair.

On the map, it's not much of a trip. The Taiwan Strait separating the mainland and the island isn't too wide, and a plane flying directly to Shanghai's airport would travel only slightly more than 600 kilometers (373 miles). But to get there, I have to go to the Chiang Kai-Shek International Airport outside Taipei, take the 60-minute, 750-km (466-mile) Cathay Pacific flight to Hong Kong, and wait for about an hour there before boarding a Dragonair flight to Shanghai. The second flight takes two more hours and 1,100 km (684 miles), and then I have to get from the new Shanghai Pudong International Airport into the city. If I'm lucky, I'll reach my Shanghai hotel by three in the afternoon.

PLENTY OF DEMAND. For the thousands of Taiwanese businesspeople who go back and forth to China every day, this trip is all the more frustrating because in a rational world, the flight would be one of the easiest around. Investors from Taiwan have poured tens of billions of dollars into China, with Shanghai and its surroundings a big favorite.

The list includes not just small, labor-intensive manufacturers of toys and textiles but also blue-chip Taiwanese electronics companies like Quanta Computer (QUCPY) and Taiwan Semiconductor Manufacturing (TSM). As a result, hundreds of thousands of Taiwanese now live or work in the Shanghai area.

Based on market demand, it would make sense for airlines to be shuttling between Shanghai and Taipei many times a day, making the 90-minute trip one of the most well traveled in the world. Somebody based in Taiwan should be able to fly out in the morning, attend an afternoon meeting in Shanghai, and be home in time to tuck the kids in bed at night.

POLITICAL FICTION. Yet when it comes to Taiwan's relations with its long-time rival, things are anything but rational. If the old saying "you can't get there from here" still applies to anyone, it's those in Taiwan who want to get to China. Ever since Chiang Kai-Shek's troops retreated to Taiwan after Mao Zedong's takeover of the mainland in 1949, it has been impossible to fly directly from one side of the strait to the other. Despite the surge in economic ties over the past 15 years, getting from Taiwan to the mainland still requires a stopover somewhere else. Usually that means Hong Kong.

Never mind that the former British colony has been ruled by China since 1997. Taiwan's government ordinarily heaps scorn on Beijing's suggestions that the "One Country, Two Systems" formula for Hong Kong, which is supposed to grant the territory a high degree of autonomy, is acceptable for Taiwan. Taipei believes Hong Kong's chief executive is accountable to no one except his bosses in Beijing.

However, for the sake of preserving the fiction of no direct links with the communist regime, Taipei pretends that One Country, Two Systems -- at least when it comes to transportation policy -- really works.

LONG WAY HOME. Ask a Taiwanese businessperson about all this, as I did on a recent trip to the island, and be prepared for an earful. "Inefficient," is how one Hsinchu-based executive diplomatically describes it. "Ridiculous," says another. "It's unbelievable. Shanghai is so close, but it takes one day each way to get there and back."

People were recently optimistic that the situation would change soon. They pinned their hopes on the Mar. 20 presidential election in Taiwan. President Chen Shui-Bian, whom Beijing regards as an arch-enemy, was running against Lien Chan, chairman of the Kuomintang.

Lien promised that if he won, he would work to break the logjam between the two sides and make progress in establishing direct flights. But the day before the election, Chen and his running mate, Vice-President Annette Lu, were shot. Both survived, but the sympathy they gathered seems to have been the key difference in helping them squeak by in an election that Lien is still challenging.

The recount is ongoing, but Chen on May 20 was sworn in for a second term. For now, chances of a speedy breakthrough in direct flights are slim. That's good news for airlines like Cathay Pacific, which offers about a dozen flights a day from Taiwan to Hong Kong. But for anybody doing business on both sides of the Taiwan Strait, it means a lot more early-morning wakeup calls -- and cross-strait trips measured not in hours but in days. Einhorn covers technology from Hong Kong for BusinessWeek. Follow his weekly Online Asia column, only on BusinessWeek Online


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