Some more medium and larger-size businesses followed suit. The overwhelming power of such a trend and the practical problems and needs that resulted had now pushed the authorities to grudgingly set up some diplomatically unofficial, but in reality governmental or quasi-governmental institutes in 1991 to deal with the related bilateral affairs, such as the Mainland Affairs Council and the straits Exchange Foundation.

     Statistics show business activities between the two countries were mind-boggling. The chart shows that in the year of 1995, trade exceeded $20 billion, a huge jump from $1 billion in 1987 when Taiwan first allowed its residents to visit the mainland. The average annual growth rate during the period was an astonishing 40%. In just a few short years, China had become Taiwan's second largest export market and third largest trading partner. China became Taiwan's largest source of trade surplus. Taiwan provided China with the tremendous amount of material and goods to add value for exportation. China thus in turn exported $24.8 billions of goods in world markets. The next chart highlights Taiwan's over-dependence on China in terms of its exports in 1998. Taiwan's foreign trade surplus totaled $7.2 billion of that $22.8 billion came from net trade surplus with China. This huge net trade surplus with China represented as much as 9% of Taiwan's GDP. This means otherwise without the surplus of China, Taiwan would have a $15.6 billion trade deficit.

By 1995 Taiwan's investment in China had accumulated to over $11 billion (with another $19 billion under contract) and numbered 30,000 projects. This amounted to 8.5% of total foreign investment in China and placed it at number 2 position, just behind Hong Kong/Macao, but ahead of Japan and the U.S. It stabilized in the last few years with larger projects by large businesses offsetting declines in smaller businesses. However, due to discouragement by the government, it is believed that the real investment must be grossly higher than what was actually reported. Taiwan's foreign exchange reserve peaked at $100 billion in 1995 and with yearly $8 to $10 billion accumulation since then, the current reserve should be much more than the reported $90 billion now. The discrepancy is assumed to be unreported in investment in China.

     This clearly signals the over-dependence of the economic relations between the two countries by any yardstick, not to mention the fact that it involves a country that treats Taiwan as an adversary and has consistently tried to smother and spoil Taiwan's attempt to establish its presence in the international arenas.