US embassy cable - 04TAIPEI3742

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 003742 
 
SIPDIS 
 
STATE PASS AIT/W 
 
E.O. 12958: DECL: 10/10/2013 
TAGS: PREL, PGOV, JA, CH, TW 
SUBJECT: JAPAN POLICY AT A CROSSROADS 
 
REF: 03 TAIPEI 3491 
 
Classified By: AIT Director Douglas Paal, Reason: 1.4 (B/D) 
 
1. (C) Summary: Taiwan officials say they are willing to be 
patient with the glacial pace of development in formal 
relations with Japan because they need time to resolve a deep 
internal policy division over how to manage the relationship. 
 The policy debate is driven by sharply divergent assessments 
over future trends in Sino-Japanese relations.  Taiwan's 
National Security Council (NSC) is looking to shape a policy 
that seeks to prevent Taiwan from becoming a negative factor 
in Sino-Japanese relations.  They advocate discarding 
Taiwan's traditional ties with the Japanese political right 
in favor of interaction with younger, more pragmatic 
policymakers in Tokyo.  NSC moderates and academic observers 
say they fear that association with Japan's nationalists will 
not only fail to advance Taiwan-Japan relations, but may also 
make Taiwan an even bigger target for Chinese nationalists 
than it already is.  On the other side of the debate is a 
coalition of pro-independence fundamentalists close to former 
President Lee Teng-hui and a group of foreign policy 
hard-liners in the Executive Yuan (EY).  Both groups seek to 
align Taiwan with Tokyo in expectation of a future strategic 
confrontation between Tokyo and Beijing.  While the NSC has 
the formal lead on Japan policy, President Chen Shui-bian has 
made a series of public statements and personnel assignments 
over the past six months that have favored the hard-liners. 
End Summary. 
 
All Quiet on the Northern Front 
------------------------------- 
 
2. (C) Japan policy officials in Taipei say there have been 
few significant developments in Taiwan-Japan relations since 
Tokyo opened a low-level annual policy dialogue in 2002. 
Taiwan MOFA Japan/Korea Section Chief Kuo Chung-shi said that 
Taiwan was pleased with Japan's enhanced support for Taiwan's 
observership at the World Health Assembly (WHA) last May, 
opposition to lifting the EU arms embargo on China, and its 
recent moves to grant Taiwan visitors visa-free entry to 
attend the 2005 Aichi Expo.  However, Kuo said that all of 
these initiatives were the result of a Japanese assessment of 
its own interests, rather than skillful diplomacy on Taiwan's 
part.  "Japan's health authorities had real concerns about 
having its neighbor outside of the WHO, its military is 
obviously concerned about PLA modernization," he added, "and 
the visa initiative is largely the result of pressure from 
Aichi officials, who expect Taiwanese to be a major source of 
tourists for their expo." 
 
3. (C) Kuo noted that the Japanese government, particularly 
the Foreign Ministry, remains reluctant to deepen the 
official relationship for fear of exacerbating already 
strained relations with Beijing.  To illustrate the static 
state of the official relationship, Kuo noted that Japan 
continues to demand that the Taiwan delegation to the annual 
round of quasi-official policy exchanges started in 2002 
(Reftel) be headed by an academic, with the rank of official 
participants from Taiwan's MOFA and NSC kept below the 
section chief level.  Kuo added that there has been similarly 
little progress on a bilateral Free Trade Agreement (FTA) 
since the two sides agreed in 2002 to authorize private 
sector think tanks to study the costs and benefits of the 
initiative.  "It has been studied to death," Kuo commented, 
"but the Japanese keep coming up with excuses over why we 
can't move any further."  Reading between the lines, Kuo said 
that Tokyo's clear message is "we will negotiate an FTA with 
Taiwan only after we've completed FTA talks with everyone 
else in Asia." 
 
A New Policy for a New Japan... 
------------------------------- 
 
4. (C) Taiwan NSC officials nonetheless say they are 
comfortable with slow pace of the relationship, because they 
see overall strategic dynamics working in Taipei's favor. 
National Security Council (NSC) Senior Advisor for Asian 
Affairs Lin Chen-wei told AIT that "Japan is increasingly 
realistic about the challenges it faces in Asia -- protecting 
sea lanes, encouraging the PRC's peaceful integration into 
the region and the world economy, and energy security."  Lin 
added that these were exactly the same strategic issues 
facing Taiwan.  "Our task now is to demonstrate to Tokyo that 
we can be a partner in meeting these challenges and are not 
simply a source of further problems in Sino-Japanese 
relations," Lin stated.  One new area for contact is the 
field of foreign aid, Lin asserted, both targeting China and 
Southeast Asia.  China's environmental and energy policies 
have immediate implications for Taiwan and Japan, Lin 
explained, and the two countries have complementary 
technologies that could help the PRC.  Lin added that Taiwan 
also has comparative advantages in the field of commercial 
development that could assist Japan maintain its economic 
influence both in the PRC and among the overseas Chinese 
business networks in Southeast Asia.  Lin said that 
anti-piracy and law enforcement cooperation, including 
actions against North Korean illicit activities, also offers 
potential for expanded contacts. 
 
5. (C) Lin said that the other reason he is content with the 
slow pace of development in the relationship is that it gives 
the NSC more time to update Taipei's Japan policy 
orientation.  Lin asserted that before Tokyo and Taipei can 
create a serious relationship, Taiwan will need to break the 
bad habits of the past.  "The traditional anti-Communist 
basis underlying Taiwan-Japan relations is no longer relevant 
today," he asserted.  Lo Fu-chen, Chairman of the Association 
of East Asian Affairs and recently departed Taiwan 
representative in Tokyo, noted that the long-standing 
division between pro-China and pro-Taiwan politicians in 
Japan is fading into the past.  "Up-and-coming politicians 
like (Democratic Party of Japan's) Maehara Seiji and (LDP 
Acting Secretary General) Abe Shinzo aren't pro-China or 
pro-Taiwan," he stated, "they are pro-Japan and will do what 
is best for their own country."  Lo added that Taipei needed 
to do more than simply bash the PRC if it wants to build a 
sustainable relationship with Tokyo. 
 
Or an Old Policy for an Old Japan 
--------------------------------- 
 
6. (C) Moderates like Lo and Lin acknowledge, however, that 
many do not share the view that PRC-Taiwan-Japan relations 
can become a positive sum game.  Lin said that biggest 
challenge he and his NSC colleagues face is the dominance of 
Lee Teng-hui and his disciples over the Japan policy process. 
 "These guys are frozen in time," complained Lin, "the 
Japanese they speak is 50 years out of date and their 
contacts, mostly retired Maritime Self-Defense Forces 
admirals, are considered right-wing extremists in Japan." 
While NSC Secretary General Chiou I-jen chairs the 
government's formal Japan policy inter-agency task force, Lee 
associates hold key Japan policy posts.  Taiwan's Tokyo 
representative, Ko Sekai, and his deputy, Chen Hong-chi, are 
long-time Lee associates (Note: Lo is as well, but people 
close to both say they have had a major falling out over 
Lee's drift to the fundamentalist extreme.  End Note). 
Officials at MOFA and the NSC say that TECRO Rep. Ko is often 
pursuing his own agenda, greatly complicating management of 
the relationship.  East Asian Affairs Association's Lo told 
AIT that "we are getting constant complaints from Tokyo over 
Ko's public remarks on Taiwan sovereignty issues." 
 
7. (C) Not all advocates of an anti-PRC Taiwan-Japan alliance 
are elderly fundamentalists, a fact that raises questions 
about the NSC's ability to pursue a more moderate line over 
the medium term.  Senior advisors to Premier Yu Shyi-kun form 
another influential hard-line policy node on Japan relations. 
 On the eve of taking his current post in May, Executive Yuan 
(EY) Secretary General Arthur Iap (Ye Guo-xing) complained to 
AIT that, outward appearances notwithstanding, it was Tokyo 
that was more "realistic" about the "China threat" than 
Washington.  "Japan doesn't voice their fears outwardly 
because it does not serve their immediate interests," he 
asserted, "but when speaking privately, it is clear they 
don't harbor the sorts of illusions about prospects for 
"China's peaceful rise" that many in Washington seem to 
have."  Another active player on Japan policy is the Taiwan 
Think Tank, which provides much of the intellectual input 
into Premier Yu's foreign policy team.  The think tank 
maintains frequent contacts with conservative Japanese 
counterparts such as the Okazaki Institute and former Prime 
Minister Nakasone Yasuhiro's Research Institute for Peace 
Studies (RIPS). 
President Sets the Direction(s) 
------------------------------- 
 
8. (C) Strait Exchange Foundation (SEF) Deputy Secretary 
General Yen Wan-ching, a member of the NSC's Japan policy 
committee, told AIT he is pessimistic that the NSC can win 
the bureaucratic battle against the hard-liners.  "The 
problem is the president," Yen continued, "he is the only one 
who can enforce discipline on the policy debate."  Yen 
bemoaned, however, that "the only time the president even 
thinks about Japan is when there is a Japanese visitor 
sitting in front of him."  When the president has spoken on 
Japan policy, he has appeared to side with the hard-liners 
rather than the moderates in his NSC.  For example, during a 
November 20 meeting with Japan Interchange Association 
Chairman Reijiro Hattori, Chen boasted that Taiwan provided 
the intelligence that helped Japan track the Chinese 
submarine that recently strayed into Japanese waters.  During 
the same open press meeting, Chen drew a comparison between 
calls (from Japanese conservatives) for Japan to "become a 
normal country" with his own efforts to give Taiwan full 
sovereignty. 
 
Avoiding Bad Company 
-------------------- 
 
9. (C) Moderates inside government and outside analysts warn 
that the future direction of Taipei's Japan policy could have 
ramifications beyond the bilateral relationship if it is 
mishandled.  Soochow University Professor Liu Bih-rong warned 
that Taiwan is running long-term risks by siding with Tokyo 
on Sino-Japanese disputes over things like territory.  "Most 
Chinese can tolerate U.S.-Taiwan relations to a certain 
extent," he assessed, "but they cannot accept the idea of 
Taiwan helping Japan against China, it brings back bitter 
memories."  The NSC's Lin offered a similar assessment.  "If 
we aren't careful, we could become the target of the growing 
anti-Japan sentiment among the Chinese public," he cautioned. 
 Lin added, "the one thing that motivates Chinese nationalism 
more than the desire for unification is bitterness towards 
Japan." 
 
Comment: More About Beijing Than Tokyo 
-------------------------------------- 
 
10. (C) Taipei's policy debate may have a greater impact on 
its ties with Beijing than with Tokyo.  The Japanese 
government has made it clear over the past three years that 
it sets the parameters and pace for the relationship, not 
Taipei.  However, Taiwan's public diplomacy, especially its 
positions on disputes between the PRC and Japan, is unlikely 
to escape notice by leaders and the public on the Mainland. 
Taipei's repeated embrace of Japanese nationalists like Tokyo 
Governor Ishihara Shintaro, support for Japan's position on 
Sino-Japanese territorial disputes, and boasts about 
Taiwan-Japan military cooperation could further exacerbate 
cross-Strait tensions.  These actions may also complicate 
Japan's efforts to manage its relationship with Beijing, 
making Tokyo less willing to take risks on issues like the EU 
arms embargo and Taiwan's observership in the WHO. 
PAAL