Framework in place for cross-strait talks to come

This article was written by June Tsai and published by the Taiwan Journal on May 29, 2008. It reports that according to Taiwan's Mainland Affairs council, negotiations between Taiwan's semi-official Straits Exchange Foundation and China's Association for Relations Across the Taiwan Straits were under way. It was hoped that formal talks focusing on cross-strait tourism and proposed charter flights would resume in June.

The council also confirmed reports that Taiwan was considering a proposal for the SEF to set up an office in China and for ARATS to establish one in Taiwan. As the foundation is authorized to handle technical and business matters with China, such an arrangement would help solve problems that might ensue from the opening of Taiwan to more Chinese tourists.

Negotiations between the SEF and ARATS first took place in October 1992, but were disrupted in July 1999 when Beijing unilaterally suspended negotiations to protest against former President Lee Teng-hui's characterization of cross-strait ties as a "special state-to-state relationship".

In his May 20 inaugural speech, President Ma Ying-jeou expected the start of weekend direct cross-strait charter flights and the subsequent arrival of more tourists from China to start in July. He expected the decision to benefit the local economy, as well as facilitate the coming of a "new era of cross-strait relations".

To prepare for the implementation of Ma's proposals, the government instructed the MAC on May 22 to authorize the SEF to conduct negotiations as soon as possible and the Ministry of Transportation and Communications to control and manage related tourism affairs. "These initiatives should be done under the conditions that national and social securities are ensured," officials said.

The government's current plan involves opening eight airports for the special flights, including Taiwan Taoyuan International Airport and Kaohsiung International Airport, as well as domestic airports in Taipei, Taichung, Hualien, Taitung, Penghu and Kinmen. How many of these airports will actually be used depends on the demand and the result of negotiations, officials said. A maximum of 3,000 Chinese tourists per day were expected to be allowed to travel to Taiwan on these flights.

At present, Chinese tourists with residency or student visas from a third country, or traveling via a third place, excluding Macau and Hong Kong, are allowed to visit Taiwan. The quota was 1,000 per day under the previous Democratic Progressive Party government, with an average of 3,000 such tourists visiting Taiwan each month since January.

In preparation for the influx of visitors, the government estimated that a total of US$42.5 million would have been spent on updating the necessary infrastructure by the end of this year. The money would go toward establishing a center responsible for managing cross-strait tourism affairs, setting up more branches of the National Immigration Agency and updating existing tourism facilities, as well as giving Taipei Songshan Airport a makeover.

Meanwhile, the Legislative Yuan is reviewing amendments to facilitate currency conversion of yuan into New Taiwan dollars in Taiwan proper. Proposed by the MAC, the amendment to Article 38 of the Act Governing Relations Between Peoples of the Taiwan Area and the Mainland Area would authorize Taiwan's Central Bank and the government's Financial Supervisory Commission to assume control of currency changes.

If the amendment passes its third reading, partial exchange with limits on the amount of money would become possible without requiring both sides to sign an agreement of currency clearance and settlement in advance. A penalty clause was also included in the revision to ban illegal exchanges or conversion with banks or institutions that were not approved to do so.

According to officials, amending the act would provide a legal base for the conversion of yuan in Taiwan. Currently, the government allows exchanges between the two currencies only in designated locations on Taiwan-controlled outlaying islands of Kinmen and Matsu. However, China has yet to recognize the New Taiwan Dollar as a legal currency.

Finally, officials at the Central Bank noted that in the beginning, only yuan could be converted into New Taiwan dollars and not vice versa. It was proposed the amount be limited to 20,000 yuan per person per visit.