- The Washington Times - Tuesday, March 6, 2001

If the Bush administration seeks an early opportunity for a bold and optimistic initiative in foreign policy, it need look no further than the Taiwan Strait. Years of a policy that attempts to balance our commitments to Taiwan with our strategic interests in China has resulted in a three-way relationship so inscrutable as to be impossible to execute. The "one China" formulation is a mirage with a desert of infertile policy options between here and there. President Bush could let a thousand flowers bloom by reorienting U.S. policy and endorsing a proposal most remarkable in its simplicity: a cross-strait common market.
The idea is the brainchild of Vincent Siew, the former Taiwanese premier and chief adviser to the Business Development Foundation of the Chinese Straits. In a Jan. 22 lecture at the American Enterprise Institute in Washington, Mr. Siew laid out his proposal to Asia scholars and analysts, postulating that the relative thawing of relations between the sides over the past decade has increased the pressure from Beijing for political integration, unlikely given the disparities in political systems. Indeed, such pressure has led to greater calls in Taiwan not for integration but for independence.
The proposal turns inside-out China's concept of "one country, two systems," by which Beijing engineered the takeover of Hong Kong. Even under that approach, it will be decades before political integration is possible. In the meantime, little is being done to blend the Hong Kong and China economies in any meaningful way. In effect, Mr. Siew is offering instead "one system, two countries," by addressing economic unity first and suggesting political convergence can follow.
The potential impact of the proposal on U.S. policy is just as promising. At present, the United States treats the relationship as weights on a scale. Any action on one side must be matched on the other. Thus, for example, we offer Permanent Normal Trade Relations (PNTR) with China, but insist that Taiwan be permitted entry into the World Trade Organization. This approach simply replaces military with economic balance of power. It is self-limiting in that there is only so much the United States can do as an outside actor to sustain a relationship based upon confrontation.
By encouraging a cross-strait common market, the United States would be placing on Beijing the onus for continued development of peaceful relations. This would alter the current dynamic, in which the burden falls to us to ensure that the rest of the world understands our commitment to Taiwan even as we attempt to coax Beijing from its political and economic autarky. Economic integration through a common market would undermine China's claim to unification essentially by calling Beijing's bluff. A necessary step toward unification must be economic integration, and a common market can be the catalyst. Putting aside the strategic implications, economic integration through a common market also makes sense on the merits. The difficulties Germany experienced in its big-bang approach to economic and political union would be magnified countless times over in China. The lesson has not been lost on the other Asian bifurcate; no less a unifier than Kim Dae-jung in South Korea has accepted his public's resistance to rapid unification with the north should Pyongyang emerge from its economic shell.
President Bush has said that he intends to treat China as a competitor rather than a partner. The subtle shift in approach is correct and will have enormous implications for U.S. policy in the region. Most importantly, it will force a serious reconsideration of the Clinton administration's misguided belief that economics is simply the extension of national security by another means. That philosophy led to the scandalous transfer of sophisticated technology that demonstrably enhanced Beijing's military edge and, ultimately, turned last year's PNTR debate into a discussion of national security rather than economic rationalism.
By endorsing a cross-strait common market and placing economic integration at the center of its China policy, the Bush administration can shift the debate to terms on which China has insisted all along. You want unification, Beijing? What have you done for it lately?
This may permit a cleaner distinction to be drawn between economic and security issues. By attempting to merge the two, the Clinton administration effectively made the transfer of technology the unintended centerpiece of its policy. A common market-centered approach would instead say to Beijing that economic development begins with your relationship across the strait, and that's your problem, not ours. Meanwhile, forget about satellite technology from Loral Corp.
Forging this policy will take great skill, but Mr. Bush has assembled a skillful foreign policy team. Perhaps the most gifted of the lot is Trade Representative Robert Zoellick, the architect of the previous Bush administration's most notable diplomatic achievement the reunification of Germany within NATO.
Economic integration across the Taiwan Strait is a fitting objective for an administration that puts freedom and economic prosperity at center of its political philosophy. It would also inject energy into a foreign policy issue that has grown tired and predictable even as China has become more militarily viable. And it has the added virtue of being the right thing to do.

Therese Shaheen is president of USAsia Commercial Development Corp.

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