US embassy cable - 05TAIPEI3095

C O N F I D E N T I A L TAIPEI 003095 
 
SIPDIS 
 
STATE FOR EAP/RSP/TC, STATE PASS USTR AND AIT/W, USTR FOR 
WINELAND, FREEMAN AND WINTERS, USMISSION GENEVA FOR SHARK 
 
E.O. 12958: DECL: 07/20/2015 
TAGS: ECON, ETRD, TW 
SUBJECT: TAIWAN REJECTS EU PROSPOSAL FOR GPA ACCESSION 
 
 
Classified By: AIT Director Douglas Paal, Reason 1.4 b/d 
 
1. (U) This is an action request.  See Para 7. 
 
2.  (C) Summary: On July 19, AIT passed USTR-provided copies 
of the latest EU proposed language designed to allow Chinese 
Taipei's accession to the WTO Committee on Government 
Procurement (GPA) to Taiwan's Bureau of Foreign Trade and to 
the National Security Council's Connie Yang.  After 
consulting within the NSC, Yang told AIT she was advising the 
Chinese Taipei office in Geneva to reject the new EU proposal 
in favor of the November position.  She thought this new 
proposal was an unacceptable compromise of Taiwan's 
sovereignty that came without a guarentee that the PRC 
delegation would accept Chinese Taipei's membership in the 
GPA Committee.  End Summary. 
 
3. (C) In November 2004, the EU proposed a two-step process 
that would have GPA Committee members first adopt a 
resolution that nomenclature used in the committee would "be 
without predjudice to the position of WTO Members concerning 
status in international law."  The second decision would 
refer to the first in allowing Chinese Taipei to accede to 
the committee.  After the Chinese refused to accept this 
formulation, the EU revised their proposal to refer directly 
to "nomenclature ... provided by a Delegation representing a 
separate customs territory" and to "note that none of this 
terminology has implications for sovereignty."  In other 
respects, the EU's two-step proposal remains the same. 
 
4. (C) On July 19, AIT shared this new proposal with NSC 
Senior Advisor Connie Yang (Yang Guang-hua).  Although she 
had not seen a copy of the proposal, she had been contacted 
by the Chinese Taipei representative in Geneva and planned to 
speak with him shortly.  Her initial reaction was that the 
new language, while possibly acceptable in the right 
circumstances, was too large a concession to make without a 
guarantee that the Chinese Delegation would accept Chinese 
Taipei's accession to the GPA Committee.  Copies of the new 
EU proposal were also provided to the BOFT Multilateral 
Affairs Office. 
 
5. (C) After an internal meeting, Yang informed AIT that the 
NSC had decided to advise Chinese Taipei's Geneva office that 
it believed the EU-proposed "second decision" should not 
refer back to the first decision since that now explicitly 
mentions "a Delegation representing a separate customs 
territory".  In addition, the NSC advocates dropping the 
reference to sovereignty and returning to the November 2004 
language on "international law" in the first decision. 
 
6. (C) Comment: Yang implied that she would be willing to 
reconsider this position if the U.S. and EU were willing to 
make strong efforts with the Chair of the GPA Committee to 
overcome Chinese objections.  She claims to see no advantage 
to giving up a bargaining chip by agreeing to this new 
proposal referencing sovereignty, especially so soon after 
the "blue book incident," without getting a Chinese chip, in 
the form of a commitment to allow Chinese Taipei's accession 
to the GPA Committee, in return.  Yang's instructions to 
Geneva were not the product of careful consideration or 
consultation, but rather were based on a hastily called 
meeting on the afternoon of July 19.  If the U.S. supports 
this new EU proposal as a means to facilitate Chinese 
Taipei's entry into the GPA, a concerted effort by the U.S. 
and EU to explain the benefits of this new proposal to the 
Chinese Taipei delegation in Geneva and to players in Taipei 
could lead Taipei to reconsider its position.  End Comment. 
 
7.  (C) Action request: Please advise whether the U.S. views 
this EU proposal as a realistic means to facilitate Chinese 
Taipei's entry into the GPA and if so, authorize AIT/T to 
work with local EU Representatives on an approach to the 
Taiwan government designed to encourage a reconsideration of 
the EU proposal. 
PAAL