US embassy cable - 05TAIPEI2673

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 002673 
 
SIPDIS 
 
WASHINGTON PASS AIT/W 
 
E.O. 12958: DECL: 06/17/2015 
TAGS: PGOV, PREL, TW, Cross Strait Politics 
SUBJECT: TAIWAN'S STRAITS EXCHANGE FOUNDATION:  NEW 
CHAIRMAN, DIM PROSPECTS 
 
REF: TAIPEI 2595 
 
Classified By:  AIT Director Douglas H. Paal, Reason 1.4 b 
 
1.  (C) Summary.  Taipei has portrayed the selection of 
former Premier Chang Chun-hsiung to be Straits Exchange 
Foundation (SEF) Chair as an effort to restore SEF as a major 
player in cross-Strait relations.  In his June 13 speech 
proposing to move forward cross-Strait dialogue, however, 
Premier Frank Hsieh omitted SEF from the list of private and 
semi-private facilitating organizations.  For their part, 
opposition "Pan-Blue" leaders dismiss both Chang as Chair and 
SEF as significant cross-Strait actors. While Taipei would 
prefer working through the quasi-official SEF than through 
genuinely private organizations, there are no indications 
that SEF is poised to recover the central role in 
cross-Strait negotiations it played in the 1990's under the 
highly respected Koo Chen-fu.  In the event that SEF does 
find a role, it will be a SEF under Chang Chun-hsiung that 
is, as one senior Democratic Progressive Party (DPP) leader 
told AIT, "safe" and "compliant."  End Summary. 
 
Remembrance of Things Past 
-------------------------- 
 
2.  (U) Premier Frank Hsieh (Chang-ting) nominated, and the 
SEF Board elected on June 10, former Premier and DPP Chair 
Chang Chun-hsiung to be the new SEF Chair, replacing the 
inimitable Koo Chen-fu who died in January.  Hsieh presented 
Chang as "upright and pragmatic," and government officials 
and Pan-Green leaders rushed to praise the Chang appointment 
as signaling a new day for SEF, which has been sidelined 
since 1998, serving primarily as a visa office for the 
Mainland Affairs Council (MAC).  MAC Chair Joseph Wu declared 
the selection of such a prominent senior leader as Chang 
Chun-hsiung would reinvigorate SEF and strengthen Taiwan's 
cross-Strait policy.  Just as quickly, however, Pan-Blue 
political leaders dismissed Chang as "a patsy" and the wrong 
person for the job, given his well-known pro-independence 
views and his lack of experience or interest in cross-Strait 
issues. 
 
Marking Time 
------------ 
 
3.  (C) Former MAC Vice Chair Alexander Huang (Chieh-cheng), 
a Chen Shui-bian appointee, agreed that Chang was not the 
right person for the SEF Chair since, as he told AIT, Chang 
has little experience with cross-Strait issues and is neither 
close to, nor has much contact with, President Chen.  Noting 
that the Foundation on International and Cross-Strait Studies 
(FICSS), of which he is now Vice President, was hosting a 
delegation from Beijing's China Institute for Contemporary 
International Relations (CICIR) on the day he (Huang) talked 
with AIT, Huang argued that President Chen "miscalculated" in 
selecting Chang because Beijing will see the Chang selection 
as an indicator that Chen is not serious about cross-Strait 
negotiations.  Also pointing to Chang's lack of direct 
cross-Strait experience, DPP Deputy SecGen Yan Wan-chin, 
himself a former SEF Deputy Director, told AIT that Chang's 
appointment was another sign that SEF's "time has passed." 
Instead, he said, future cross-Strait negotiations will 
likely follow a variation of the 2005 Chinese New Year 
charter flight negotiations between private entities with 
functional government participation. 
 
A Safe Choice 
------------- 
 
4.  (C) People First Party (PFP) Policy Research Director 
Vincent Chang (Hsien-yao) told AIT that Presidential Office 
Deputy SecGen James Huang (Chih-fang) had called him (Chang) 
in mid May to ask what the PFP thought about Chang 
Chun-hsiung as SEF Chair.  Noting that President Chen had 
long hoped Soong would assume the SEF Chair, Vincent Chang 
suggested Chen was trying one last time to coax Soong into 
the SEF Chair. 
 
5.  (C) Examination Yuan President and pro-independence 
fundamentalist Yao Chia-wen informed AIT that President Chen 
had told him the Chang Chun-hsiung selection was intended to 
keep SEF compliant and quiescent.  This occurred during Yao's 
meeting with Chen to discuss the concerns that DPP "elders" 
(dalao) have over what they see as Chen's too-conciliatory 
approach on cross-Strait relations.  Noting that Premier 
Hsieh's June 13 statement (Ref A) had further disturbed the 
elders, Yao said he has arranged for a meeting next week 
between a group of elders, including Yao and Peng Ming-min, 
and President Chen to discuss cross-Strait issues and 
constitutional reform.  The elders intend "to keep the 
pressure" on Chen to adhere to "DPP principles," Yao told 
AIT, noting that he regularly meets and coordinates with 
former President and independence fundamentalist Lee 
Teng-hui. 
 
6.  (C) Former MAC Chair and current KMT legislator Su Chi 
told AIT that the Chang selection was wrong because Chang is 
"too political," whereas SEF needed a more centrist person to 
give it credibility with Beijing.  On the other hand, Su 
surmised, President Chen may have intended Chang's 
appointment to "cleanse" the SEF of its close association 
with the controversial "1992 consensus" (one China, different 
interpretations).  The private and quasi-private 
organizations PM Hsieh proposed on June 13 to facilitate 
cross-Strait cargo charter flight and agricultural trade 
negotiations, Su continued, indicated the Chen 
administration, too, understood that SEF's time had passed. 
 
Comment:  Not Wave of Future 
---------------------------- 
 
7.  (C) The appointment of Chang Chun-hsiung appears designed 
both to ensure SEF compliance in the event a role 
materializes for SEF in the current spate of cross-Strait 
maneuvering, as well as to give face to a party warhorse who 
wanted to resign his Legislative Yuan (LY) seat when he 
failed to become LY president.  Precisely because Chang is so 
clearly identified as a "deep Green" political leader, 
Beijing will likely have little trust in him and little 
interest therefore in dealing with him.  Chen insiders have 
greater hopes for using the yet-to-be-appointed Cross-Strait 
Peace and Development Commission, expected to be announced 
later this year. 
 
8.  (C) The recent spate of cross-Strait movements on the 
Taiwan side derived from Premier Hsieh's June 13 public 
response to Beijing's earlier offers to Taiwan's opposition 
leaders of cooperation on cargo charter flights, Taiwan 
agricultural exports to Mainland China, and PRC tourists to 
Taiwan.  In only one of these areas has SEF even been 
mentioned as a possible facilitator -- tourism, at once 
Beijing's highest and Taipei's lowest current cross-Strait 
priority. 
PAAL