Taiwan rejects China offers as hopes for talks dim

TAIPEI/BEIJING - Taiwan has rejected Chinese offers of economic sweeteners and a new formula to define current bilateral ties, dashing hopes for fresh talks between the rivals and prolonging a dangerous stalemate.

James Soong, head of Taiwan's second-biggest opposition party, and Chinese President Hu Jintao proposed a "two sides, one China" formula on Thursday as a basis for talks between Beijing and an island it considers its own.

China also offered to ease employment for Taiwan residents on the mainland, simplify entry and exit procedures and reduce tuition fees for Taiwan students. The move came as Soong ended a nine-day visit, the latest in a string by opposition delegations.

Beijing's strategy aims to increase pressure on President Chen Shui-bian, who supports independence for Taiwan, the self-governing island China insists must return to the fold. China's Kuomintang Nationalist authorities fled to Taiwan in 1949 and set up their government there after losing power on the mainland to Mao Zedong's communist armies.

Chen's government said on Friday that any agreements between China and the island's opposition parties were of no consequence and Beijing should deal with the government on these issues.

"The government is disappointed and regrets that China's policy towards Taiwan is still rigid and shows no concrete sincerity to improve bilateral relations," said Michael You, vice chairman of Taiwan's Mainland Affairs Council.

"We insist any issues relating to government authority must be discussed through official channels on both sides," he said, adding that Taiwan remained willing to open dialogue with China on an equal basis with no preconditions.

China said its offers were aimed at deepening ties between the two sides. Economic links have flourished despite a long political stalemate that has turned the Taiwan Strait into a dangerous flashpoint.

"This is another gesture of affinity of easing tensions across the Taiwan Strait," China's Xinhua news agency reported, quoting Chen Yunlin, head of China's Taiwan Affairs Office.

In a communique issued after Thursday's Hu-Soong meeting, the two parties pledged to push for talks to establish a cross-Strait free trade zone and to start regular direct flights next year.

They add to other economic incentives offered to the leader of the Kuomintang (KMT) last month.

The mainland had raised the stakes between the two sides in March when it passed an Anti-Secession Law allowing for use of military force should Taiwan move towards formal independence.

Since then, it has been wooing Taiwan opposition delegations with the aim of forcing Chen into a compromise that would allow for fresh dialogue.

Pressure was piling up on Chen ahead of a Saturday election that will determine the fate of some constitutional reforms.

A poll by cable station TVBS found 29 per cent of people plan to vote for the KMT, and 22 per cent for Chen's Democratic Progressive Party. As many as 38 per cent are undecided.

"The most important achievement of this trip is we agreed on 'two sides, one China'. This is a good breakthrough allowing us to resume equal dialogue," Soong told a news conference after returning to Taipei.

However, editorials in Taiwan's major dailies broadly agreed with Chen, who said late on Thursday that the formula offered no concessions from China.

The terminology redefines a 1992 consensus between China and Taiwan that there was "one China", potentially leaving a face-saving opening for talks between Beijing and Taipei. The consensus had formed the basis for previous talks up to 1999.

While analysts say Soong failed to build a bridge between Chen and Beijing, China's Xinhua News Agency reported that China was considering building a tunnel to link the mainland with Taiwan.

"Attaching top priority to national reunification, the Chinese government has proposed many measures for the promotion of the benefits of people on both sides of the Taiwan Straits," Xinhua said.

- REUTERS