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What Asia Needs Is Peace Based on Reality

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RICHARD C. KOO is senior economist at Nomura Research Institute in Tokyo

For the longest time, people in East Asia have postponed various political, diplomatic and military issues and concentrated their efforts on making money or, more precisely, making money by exporting goods to the United States.

The first country to discover this formula for economic success was Japan, which, beginning in the 1950s, single-mindedly pursued export-led growth while ignoring all other issues or leaving them for the United States to resolve. Taiwan and South Korea, which had various domestic political problems in the ‘50s and ‘60s, also discovered the formula in the ‘70s and have pursued it with equal vigor. Finally, China realized what it was missing and decided to dump the class struggle and Maoism to join the bandwagon.

The phenomenal economic growth that followed, therefore, was made possible by the fact that political leaders in the region all decided to postpone their intra-regional problems. Indeed, throughout this period, everyone in Asia was looking at Washington for direction, and countries in the region had better dialogue with Washington than with one another.

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Recently, however, there have been indications that this condition is becoming increasingly difficult to maintain. Indeed, the recent military tension over the presidential election in Taiwan and worries over the fate of Hong Kong after July 1997 reminded people that political and military problems are still all there. Furthermore, none of the problems are becoming any easier to resolve.

In particular, until recently there was a myth in East Asia that contributed greatly to the stability (and, consequently, to economic growth) in the region. This myth was that people on both sides of the Taiwan Strait agreed that there was only one China and that Taiwan was part of China. This brilliant formula, created by Henry A. Kissinger, allowed many countries, including the United States, to switch diplomatic ties from Taipei to Beijing without worrying about the so-called Taiwan problem. After all, based on this formula, the problem of Taiwan never existed; there was only the China problem.

Although country after country shifted diplomatic ties from Taipei to Beijing, the Nationalist government in Taipei could not object to the formula, either, because it too relied on the same argument to legitimize the minority rule by the Chinese mainlanders who came to Taiwan with Chiang Kai-shek (15%) over the native Taiwanese majority (85%).

The end of military dictatorship and the introduction of democracy in Taiwan by President Lee Teng-hui, however, suddenly made the views and desires of the indigenous 85% important. And this 85% experienced a very different history than what is typically written in Nationalist Chinese textbooks.

The native Taiwanese majority remembers, for example, that when Taiwan was ceded to Japan after the Sino-Japanese War more than 100 years ago, the representative of the Ching Dynasty said, “Taiwan is outside the cultural realm of China,” suggesting that its people are not worthy of being called Chinese.

They also remember that when Taiwan was returned to China after 50 years of Japanese rule at the end of World War II, the Nationalist Chinese government treated the Taiwanese badly, culminating in the massacre of Feb. 28, 1947, when thousands of people--particularly well-educated men--were killed. The continuation of the Chinese Civil War also meant that Chinese Communists have been trying to make life difficult for the residents of Taiwan at every opportunity during the last 47 years. This history forced the 20 million native Taiwanese to acquire a very different national identity than that of the mainland Chinese.

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In particular, after being treated as second-class citizens under Japanese and Nationalist Chinese rule for more than 100 years, these people have a strong wish to be recognized for who they are. After all, through sheer hard work under almost impossible diplomatic circumstances, they created one of the freest and most prosperous countries in Asia. They are rightfully proud of their achievements and are asking for due recognition.

Unless another dictatorship is imposed in Taiwan, therefore, it is unrealistic to assume that these people will somehow stop their pursuit of international recognition any time soon. The Kissinger formula was destined to collapse once democracy took hold in Taiwan.

The problem is that very little of this history has been told in China, or anywhere else for that matter, because it was not convenient for either the Communist or Nationalist governments. As a result, most people, including the current leaders of China, are unaware of what the native Taiwanese actually saw and felt during the last 100 years.

With Communist leaders fully committed to “liberating Taiwan to reunite with the motherland,” and democracy in Taiwan increasingly bringing out cries for international recognition, the tension between China and Taiwan can only increase over time. Every time a myth breaks down, there is always chaos until a new reality is recognized.

Assuming that the democracy in Taiwan is here to stay, the only question left is whether the leaders in China have the courage to face the new reality. Although the current leadership in Beijing is politically 100% committed to “liberating Taiwan,” one need not be overly pessimistic.

One of the greatest political leaders of all time, the late Premier Chou En-lai, faced the same issue in the ‘70s when the Socialist government was formed in Portugal. Believing that socialist countries should not possess colonies, the Portuguese government tried to return Macao (still a Portuguese colony) back to China. Chou flatly refused the offer, arguing that the time was not ripe. For he knew that taking back Macao at that time would create a one-country, two-system condition from Day One. And if it did not work, people in Hong Kong, sitting only 40 miles away, would panic and leave, resulting in tremendous economic losses for China. He thus created one of the best examples in Chinese history of coolheadedness winning over hot nationalism.

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Viewed objectively, nothing really changes even if Taiwan goes independent, because it has been de facto independent for the last 47 years. Even if it changes its flag, Taiwan cannot pack up and walk away from the Taiwan Strait. It makes more sense, therefore, for the Chinese leaders to leave this destructive issue to a future generation and concentrate instead on the more urgent task of raising Chinese living standards.

In terms of the latter, one of the earliest, and still most successful, foreign investors in China has been the Taiwanese. And they were able to contribute greatly to the Chinese economy at its most critical takeoff period precisely because Taiwan has not been a part of China during the last five decades.

If the current Chinese leaders find the courage to emulate Chou, one of the greatest political dangers in the region can be averted. Such a decision will bring real peace and stability to the area that is not based on myths and dictators. And Asia, more than anywhere else, needs a solid political foundation to extend its already spectacular economic success.

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