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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q3, 2002

The summer quarter was a remarkable period in the evolution of Taiwan-China-U.S. relations. A number of events transpired that just a year ago might have led to the brink of a cross-Strait war, but this year raised only mild reactions in Beijing. Taiwan President Chen Shui-bian’s August remarks on Taiwan “walking its own road,” First Lady Wu Shu-chen’s highly publicized visit to the United States, and several well reported exchanges of military delegations – particularly Vice Minister of National Defense (MND) Kang Ning-hsiang’s early September visit – all evoked only muted responses from China. Beijing, apparently, is fully focused on its leadership transition in the lead-up to the 16th Party Congress, while Washington continues with the war on terrorism, Afghanistan, and preparations for a potential conflict in Iraq.

Against this backdrop, China steadily continues its modernization program which is producing a visible increase in military capabilities. In turn, Taiwan is carrying out a modernization program that places priority on streamlining and reducing costs, with questionable results in terms of operational capabilities. To close the triangle, the U.S. marches forward with arms sales and enhanced military-to-military relations across the board with Taiwan. This quarterly report will attempt to clarify this complex picture as we look at future developments in the arms sales area and in the cross-Strait political dynamic.

 

Executive Summary: Taiwan Defense & Security Report – Q3, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q2, 2002

The US-Taiwan Business Council’s Defense Summit in March 2002 was an important event that signaled some changes in the way the US-Taiwan defense relationship is conducted. The conference also raised a number of important issues that will continue to attract our interest over the next few years. This quarterly report will explore developments in the military-to-military relationship after the conference, and present updates on major defense system sales and programs.

This report will also provide some background information on a critical aspect of the arms sales program approval process known as the “national disclosure policy”, and will identify changes in the key players involved in the relationship between the U.S. and Taiwan. Finally, we will identify some upcoming events in China that are of interest to those living and working in the cross-Strait arena.

 

Executive Summary: Taiwan Defense & Security Report – Q2, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q1, 2002

It has been projected that Taiwan will spend in excess of US$26 billion over the next ten years on its defense needs, and the defense industry is also one of the largest sectors represented in the US-Taiwan Business Council’s membership. To better serve those members, the Council hosted a defense conference entitled the “US-Taiwan Defense Summit” in Saint Petersburg, Florida, in early March of 2002. The objective of the event was to bring together all of the principals in the US-Taiwan defense relationship, both from U.S. and Taiwan industry and from both governments.

Unlike in most other industries, the defense relationship between Taiwan and the U.S. is one that is highly sensitive. Because of that sensitivity, the Council determined that the entire event should be considered off-the-record, and the event was also off-limits to the media. We wanted all of our attendees to feel comfortable talking about these sensitive issues, and to focus on issues related to furthering the commercial relationship between our two economies.

Rather than discussing specific arms sales, the focal point of the event was on the process itself, as we wanted to bring clarity and transparency to the often-complex defense procurement process. That is not, of course, a task that could be accomplished with one conference. In fact, the Council feels that this event was merely the beginning of a long road towards normalizing defense procurement so that less attention will be paid to it, with less media hype, hopefully resulting in a more efficient and productive process.

The planning for this conference began more than a year ago with the decision to invite Taiwan’s Minister of National Defense to speak. It was to be the first time since 1962 that a Minister of National Defense from Taiwan would visit the United States for anything other than a transit stop. In addition, Taiwan’s Premier Yu Shyi-kun tapped Chief of the General Staff General Tang Yao-ming to be the new Minister of National Defense only a matter of weeks before the scheduled start of the conference. This made for a fortuitous meeting, as Minister Tang could benefit from being introduced to U.S. industry leaders so soon after his appointment.

The purpose of this analysis is to focus on what took place during those three days in Florida. We will attempt to clarify the objectives of the conference, while summarizing the four main topics of the meeting, including Taiwan’s defense procurement process, offset requirements, Taiwan’s defensive position and military strategy, and the outlook for future military sales to Taiwan.

 

Executive Summary: Taiwan Defense & Security Report – Q1, 2002

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q3, 2001

In April of this year, the new Bush administration announced the approval of an extraordinary package of arms to Taiwan at what appeared to be the last formal US-Taiwan Arms Sales Meetings. Tied to the list of approvals was a decision by the new president to do away with these annual talks and instead handle Taiwan’s legitimate defense requirements in a routine, case-by-case manner as is done with other friends and allies of the United States. This and the arms sales decisions, which included breakthrough support for the sale of diesel electric submarines to Taiwan, generated speculation as to the direction the new administration would take in its relationships with Taiwan and the PRC.

In the following weeks and months, some answers began to emerge. The Bush administration allowed President Chen Shui-bian of Taiwan to make transit stops in New York and Texas, en route to and on his return from an official visit to South America. Rather than being strictly constrained in his activities during these transit stops as had been the case in previous instances, the administration allowed Chen significant freedom to tour the host cities and meet with local and national political leaders. On the military front, indications were that military-to-military relations were becoming much closer and more substantive in recognition of and in response to the inexorably growing threat posed by Chinese ballistic missile deployments, military modernization, and unabated use-of-force rhetoric. At the same time, imminent WTO accession by both the PRC and Taiwan, Beijing’s being awarded the 2008 Olympics, and steadily deepening concerns about an economic recession appeared to mitigate against the possibility of conflict in the Taiwan Strait at least in the short term.

The focus of this report is to provide some thoughts on where the US-Taiwan military relationship stands; summarize the progress to date on the arms sales decisions of April 2001 and certain other key programs; and offer some brief concluding comments on Taiwan’s economic situation and potential budget problems and on the effects of the defense reorganization program and upcoming leadership changes.

 

Executive Summary: Taiwan Defense & Security Report – Q3, 2001

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Taiwan Defense & Security Reports

Taiwan Defense & Security Report – Q1, 2001

Typically, coverage of Taiwan in general – and of US-Taiwan military matters in particular – is sparse and infrequent. Who could have foreseen therefore the combined effects of the EP-3E incident and the surprisingly detailed public dissemination of the Bush Administration’s US-Taiwan Arms Sales Talks decisions? As a result of these virtually consecutive but quite coincidental events, US-Taiwan military ties, US-PRC relations and the overall security situation in the Taiwan Strait area and Western Pacific suddenly have received an unprecedented amount of coverage in all forms of public media.

The year 2001 dawned with the Taiwan political and military leadership, and Taiwan’s supporters in the U.S., hoping that the incoming Bush administration would be an improvement over the preceding eight years of what many believed had been lukewarm support, particularly in the area of critically needed arms sales. There had been no major arms sales released for Taiwan since the outgoing Bush I administration had approved the sale of 150 F-16s in 1992.

On April 25, 2001, at the 20th annual US-Taiwan Arms Sales Conference, they got a clear and unmistakable answer. The new administration reportedly approved release of 4 ex-USN Kidd Class destroyers, 12 P-3C Orion ASW aircraft, M-109A6 SP howitzers, AAV-7 amphibious assault vehicles, CH-53 mine sweeping helicopters, other equipment, technical support and training, and agreed, after more than two decades of emphatic turn-downs, to assist Taiwan in obtaining up to eight diesel-electric submarines.

Although AEGIS destroyers, the priority request of greatest long-term importance for Taiwan, were again deferred, this is being described as the largest – potentially valued at close to $5 billion — arms sales package since the F-16 sale. However, in terms of the number and significance of the major weapons systems included in the decision, it is arguably the largest arms talks approval since diplomatic de-recognition in 1979. President Bush characterized the approvals as “the right package for this moment,” and made it clear that his administration would continue to ensure that Taiwan’s defensive needs would be met in the face of a growing threat from China. He also indicated that the annual arms sales conference with Taiwan would be phased out, and that in the future, Taiwan’s defensive arms requirements would be addressed as needed on a case-by-case basis.

And, as icing – sweet or bittersweet, depending on one’s perspective — on the cake, President Bush stated categorically during a nationwide television interview a few days later that the United States would come to Taiwan’s aid in the event of an attack from the People’s Republic with “whatever it takes.” The verdict is still out as to whether this was an inadvertent slip and that “strategic ambiguity” is still alive and well – the president modified his statement the following day and administration officials insisted that US policy had not changed. But, slip up or not, taken in context with Candidate Bush’s campaign rhetoric, the EP-3E incident, the arms talks decisions, and the reported contents of Secretary of Defense Rumsfeld’s strategic review, it appears that the U.S. relationship with Beijing is shifting to one of strategic competition. And, relations with Taiwan, while still unofficial, are moving towards closer cooperation, particularly in the military arena.

Given the size, significance and context of this arms sales package, it deserves closer examination. Specifically, attention needs to be focused on what reportedly was approved; what was deferred or disapproved; what was decided in conjunction with the Talks; and what the implications are for Taiwan and the US.

 

Executive Summary: Taiwan Defense & Security Report – Q1, 2001