Paper War Games : China Threatens to Attack If Taiwan Delays Reunification Talks. but Taiwan-Feisty, Wealthy and Preparing to Elect a New President-Is Not Intimidated

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The odd thing about it all was that peace was becoming a campaign theme in Taiwan's presidential election. All three of the major candidates had put forth proposals to improve relations with Beijing, which considers Taiwan a renegade province. One candidate promised a 30-year peace treaty. Another called for direct sea and air links. Even Chen Shui- bian, the candidate from the pro-independence party, offered to meet Chinese President Jiang Zemin in Hong Kong for negotiations. For the first time in a half century, everyone seemed to agree that it was time to learn to live with China.

That's why Beijing's bombshell came as such a shock. In a report released last week, China threatened to attack Taiwan if it dragged its feet on reunification talks. Chinese leaders have threatened war ever since the defeated Nationalists retreated to Taiwan in 1949--but only if Taipei declared independence or was occupied by foreign powers. When Taiwan held its first democratic presidential election four years ago, Beijing lobbed missiles into the Taiwan Strait. Last week's assault, unleashed in a government white paper, was another warning to Taiwan's voters, who will go to the polls on March 18: "If they select a separatist candidate," says Yu Keli, vice president of Beijing's Institute of Taiwan Studies, "it will be very hard to keep the situation peaceful." Washington warned China not to interfere, prompting more angry rhetoric from Beijing.

So far China's "paper missile," as Taiwan political scientist Andrew Yang called the report, seems to have misfired. Beijing's main target was former Taipei mayor Chen, a longtime champion of Taiwan's right to independence until last year, when he cooled his rhetoric. Chen is neck- and-neck with the other candidates, with about 25 percent support in the polls. In recent weeks he has been mired in domestic politics, accusing the ruling Nationalist Party (KMT) of corruption while parrying attacks from other candidates. But after Beijing's latest threat, Chen's defiant spirit returned. "They are asking for our surrender," he shouted to cheering villagers in central Taiwan, as firecrackers exploded around him. "And we're not going to negotiate for that."

The other candidates have been equally forceful. James Soong, a former KMT leader now running independently, and who has always staunchly opposed independence, was the first to respond to the report. "The future of Taiwan should be determined by the people of Taiwan," Soong said. "We will never accept terms for surrender." Vice President Lien Chan, the KMT candidate, said, "Any pressure Communist China gives us about [our] right to exist will be met with the firm opposition of Taiwan's 22 million people."

Why would Beijing want to alienate Taiwan now? According to U.S. business leaders and government officials who have visited Beijing recently, the Chinese are worried that a new dynamic may be emerging in the Taiwan-U.S.-China triangle. They were infuriated last July, when Taiwanese President Lee Teng-hui tried to boost Taipei's international status by saying that cross-strait relations were on "a special state- to-state basis." Beijing is worried that Washington's commitment to a one-China policy might be slipping. The Chinese are especially angry over the recent passage by the U.S. House of Representatives of a bill (called the Taiwan Security Enhancement Act) that would arm Taiwan with more weapons, which they believe will forestall unification.

Chinese officials have lashed out at Congress for supporting the Taiwan defense legislation. In Washington, U.S. legislators and Chinese diplomats traded barbs. The Chinese ambassador's deputy, Liu Xiaoming, called Congress "a reckless and irresponsible body" and warned that the act would push Taiwan closer to a war with China. According to U.S. Senator Jesse Helms, Liu also insulted the intelligence of all U.S. representatives, especially those who voted for the bill. …