US embassy cable - 05TAIPEI130

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 000130 
 
SIPDIS 
 
STATE PASS AIT/W 
 
E.O. 12958: DECL: 01/13/2015 
TAGS: PGOV, PREL, CH, TW, Cross Strait Politics 
SUBJECT:  CROSS-STRAIT CHARTER FLIGHTS:  ONE STEP FORWARD 
 
 
Classified By: AIT Director Douglas H. Paal.  Reason: 1.4 (B/D) 
 
1.  (C) Summary.  According to Taiwan's Mainland Affairs 
Council (MAC), Beijing this afternoon, January 13,  accepted 
Taiwan's proposed delegation to participate in negotiations 
on direct cross-Strait charter flights around the Chinese New 
Year.  At this still early point in the negotiation process, 
both sides have actually made small concessions -- Beijing by 
apparently accepting the presence of Taiwan government 
aviation officials in the Taiwan delegation, and Taiwan by 
pulling back from its adamant insistence that Taiwanese 
officials responsible for cross-Strait relations be included 
in the Taiwan delegation.  In the face of growing Taiwan 
public hopes for a charter flight deal in time for the 
Chinese New Year, and of opposition Kuomintang (KMT) 
demonstration that its delegation to Beijing successfully 
worked out arrangements for charter flights, the DPP 
government had been forced to accept Beijing and the KMT's 
agenda, and received a small concession from the PRC in 
return.  End Summary. 
 
Taiwan Twice Responds 
--------------------- 
 
2.  (C) Taiwan twice responded to the PRC Taiwan Affairs 
Office (TAO) call for what Taiwan calls the "second round" of 
negotiations, the "first round" being a meeting in Macao last 
Friday, January 7, that MAC Chairman Joseph Wu insisted to 
AIT had been "very successful" in setting the framework for 
further negotiations.  Chen Chung-hsin, Counselor responsible 
for cross-strait relations at the National Security Council 
(NSC), told AIT on January 11, that the government had 
authorized Taipei Airline Association (TAA) Director Michael 
Lo (Lo Ta-hsin) to transmit a proposed Taiwan five-person 
delegation list to Beijing consisting of:  TAA Director 
Michael Lo, another airline industry representative, the 
Chief of the Civil Aeronautics Administration (CAA, under the 
Communication and Transportation Ministry), and one official 
each from the Mainland Affairs Council (MAC) and the Straits 
Exchange Foundation (SEF).  Explaining that he is a 
"pragmatist" who just wants to get charter flights moving, 
Chen said he had cautioned his "colleagues" that the MAC and 
SEF officials would be automatically rejected by TAO.  That, 
he noted, is exactly what happened, as the TAO spokesman 
announced in a press conference in Beijing yesterday, January 
12. 
 
3.  (C) That same afternoon, Chen said, the Taiwan government 
worked out a new delegation list consisting of Michael Lo, 
CAA Director Chang Kuo-cheng, one CAA staffer, and Mr. Lo's 
Chief Secretary, which NSC Secretary-General Chiou I-jen 
approved and which Michael Lo transmitted to his PRC CAA 
counterpart in Beijing.  Chen felt reasonably confident that 
this second list would be acceptable to Beijing, because, he 
said, the TAO spokesman in Beijing had replied to a 
reporter,s query on whether all Taiwan government officials 
would be unacceptable to Beijing by clarifying that he had 
only mentioned MAC and SEF. 
 
4.  (C) This afternoon, January 13, Joseph Wu called AIT to 
say that Taiwan had just received a positive response from 
Beijing, accepting Taiwan's revised delegation proposal. 
Shortly afterward, NSC Counselor Chen called to convey the 
same messagae, clearly delighted by the outcome and proud of 
his part in it.  The Taiwan side, Wu told AIT, had made one 
last ditch effort to get a MAC economist included in the 
delegation, but Beijing had refused.  Wu stated the two sides 
are working out the details of meeting time and place, which 
he hopes will take place this weekend.  Final details will be 
announced at a government-wide -- MAC, NSC, MND, and Ministry 
of Transport and Communications -- press conference tomorrow 
afternoon, January 14, at 5:00 p.m. 
 
Way Forward 
----------- 
 
5.  (C) In his meeting with AIT, Chen appeared more flexible 
on the issue of Taiwan government participation in charter 
flight negotiations than MAC Chair Joseph Wu.  In public and 
to AIT in private, Wu has continued to insist that Taiwan 
will only negotiate with China on charter flights according 
to the "Hong Kong model" (the 2002 air service agreement 
between Hong Kong and Taiwan by delegations nominally headed 
by airline industry officials, but with all substantive 
negotiations done by government officials from both sides). 
Chen, however, supported revision of the proposed Taiwan 
delegation list, explaining to AIT that the "Hong Kong model" 
could be used for subsequent expanded cross-strait air 
service negotiations.  President Chen, he told AIT, had 
approved of this graduated negotiation process, the third 
stage of which would be negotiation on the "three links" 
(commodity, transport, and post).   At the present stage, he 
explained, charter flights are the "critical key" on which 
future progress depends.  First, he said, we must reduce 
cross-Strait tensions. 
 
6.  (C) Chen told AIT that the DPP government was having to 
tread very carefully on the cross-Strait issue, as many of 
its supporters were hostile to any concessions on 
negotiations with China.  "Liberty Times," he noted, 
represented that contingent and functioned as a major 
restraint on the Government,s freedom of action.  Chen, 
however, was just as dismissive of the KMT delegation to 
Beijing as Joseph Wu and other DPP leaders.  The KMT trip, 
Chen charged bitterly, constituted Chinese government 
intervention to help the KMT, which allowed itself to be used 
by China.  He was particularly incensed at the claims by the 
KMT that the charter flight issue had been resolved by the 
KMT delegation to Beijing (see septel report on KMT Chairman 
Lien Chan,s meeting with the Director). 
 
 
Comment 
------ 
 
7.  (C) The charter flight issue is playing out against the 
backdrop of  Taiwan,s bitter post-elections politics in the 
run up to the formation of the new government (i.e., 
Executive Yuan).  The KMT delegation visit to Beijing and 
subsequent KMT claims that it successfully negotiated a 
charter flight deal forced the Taipei government to move and 
necessitated the Taiwan government's small but significant 
back step on delegation composition.  Beijing saved Taipei 
some face by agreeing to two non-mainland related officials 
in the Taiwan delegation.  This is better news than AIT is 
used to. 
PAAL