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The Taiwan-China Relation : The Dilemma of Political Confrontation and Economic Interdependence.

This obviously and severely violates the prudent economic policy of spreading and diversifying foreign investment risks and should be addressed and rectified right away.The irony of all this is that the country that was most concerned about the Chinese economy and its Yen melting down under the storms of the Asian economic crisis was none other than Taiwan, with its huge investment and trade concentration in China, a country which is its only adversary in the whole world.

REALTY - HANGOVERS & TRAVAILS

     This extremely high degree of dependence on China was the inevitable result of a passive and indifferent government which was used to the idea of much like the way it behaved during the creation of Taiwan's economic miracle, governing by doing nothing or following the footsteps of its business entrepreneurs instead of playing the role of a pathfinder and facilitator. This uncoordinated and unorganized approach left business communities groping helplessly in the dark and has contributed to considerable wasteful efforts and resources and loss of opportunities and even human lives. Without governmental guidance and assistance, businesses all swarmed to Mainland China as an expedient way out of their dilemma.

     From the time the gate was opened for its residents to visit China, to start indirect unofficial trade and investment, to establish semi-official institutions to handle bilateral affairs, the Taiwan government has played an unwilling and passive role, prompted into action only when pressured by the dire needs of the businesses or only to stopgap after problems and crises have occurred. In the beginning, it didn't come up with any effective policies or plans to prevent this over-indulgence from happening and guide its business sectors to diversity properly to other countries. Once the concentrating pattern was forming, it failed to pro-actively enter into negotiation with China to secure the best deal and agreement possible, knowing that China and a huge benefit to gain from this linkage, and would be willing to conceded then.


The wakeup call came when China fired its missiles across the Taiwan Strait to intimidate the 1996 presidential election and when China made a big fuss about President Lee's visit of his alma mater. Whether the government actually woke up was anybody's guess. The only certain thing was that it threw out a "no haste, use patience" slogan to attempt to slow down the flow of funds to China. This kind of moral persuasion is naive and impractical and has not solved the problem whatsoever.



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