A Forum for Constraints

The conventional wisdom is accurately portrayed by Keith Bradsher of the NYTimes in an article on Vice-President Elect Siew's meeting with China's bigwigs at the recent Boao forum in China...

Mr. Siew and President-elect Ma Ying-jeou will take office in Taipei on May 20 with a strong electoral mandate to reduce the hostility that has existed with Beijing for most of the past six decades. But Taiwan’s leaders and officials on the mainland each face strong domestic pressures not to make too many concessions too quickly or too easily.

Those domestic pressures are likely to limit their room to maneuver and force them to pursue limited agendas at first, focused on issues like tourism and charter flights, political analysts said.

Ma wants talks rapidly after he takes office on May 20. Because of the massive pressure on Ma from investors who expect to make big $$ when Chinese money floods in -- if it floods in -- and the expectations of locals -- Ma must make a deal.

Thus, I think the "constraints" argument is weak, especially by comparison with the pressures on Ma. Ma's KMT controls the military, the judiciary, the police, the bureaucracy, most major businesses, etc. Where is the constraint on Ma? The threat of street demonstrations? I think that he can buy off most objections simply by making the money flow; if promises of cash can get him elected.... and let's not forget, the real dealing is going on in the negotiations between the KMT and Beijing that no one is writing about....

There was a minor flap about Siew using the "Tai Bao Zhen" -- the document issued to Taiwanese who travel in China. Bruce Jacobs, the well known Taiwan scholar, said that Siew's was not actually stamped, a concession by Chinese authorities. Siew was criticized by the pro-Taiwan types for selling out.....

AP writes of the meeting, looking at the economic aspects:

[Ma's]His goals for Taiwan include 6 percent annual economic growth, a jobless rate no higher than 3 percent, and per capita income doubling in eight years to $30,000. The economy grew 5.7 percent last year, though the average for Chen's eight-year presidency will probably be less than 4.5 percent.

The core of Ma's economic program involves public and private investments in a number of long-term infrastructural and industrial projects - investments that could well push Taiwan's budget deficit farther into the red.

At the forum, Siew invited the cash-rich Chinese to invest in some of the projects. Taiwanese officials said they expressed some initial interest.

Ma has also promised to bolster Taiwan's flagging tourism industry - an area that could generate immediate revenues, if Beijing agrees to a large-scale tourist outflow. According to Ma's plan, 1 million Chinese would visit Taiwan each year, generating $1 billion in revenues.

"Taiwan's high-tech and other exports could suffer a decline amid the global economic slowdown, but the drop would be partially offset by tourism," said Norman Yin, an economist with Taiwan's National Chengchi University.

Chinese tourism needs better air service to flourish, and the extension of existing holiday charter service to weekends - endorsed by Hu - seems a good step in that direction. Ma has also promised to push for the launching of regular commercial flights, though he does not believe they can start before the second half of next

Here's one use for Chinese money above -- getting it to invest in projects in infrastructure projects in Taiwan.

It's interesting how Taiwan's tourism industry is "flagging." Where do these writers get this crap? Is there no Google in the AP offices? The China Post recently reported:

In 2008, the number of tourist arrivals, as of yesterday [5 Apr], posted an annual growth of 14.29%, twice the target growth of 7 percent.

Of the inbound tourists so far this year, those from South Korea recorded the highest annual increase of 42%, followed by a 35% gain for those from Hong Kong and Macao, and a 27% surge for tourists from Malaysia.

Given the sharp growth, the number of inbound tourists is expected to not only exceed the historical high of 3.72 million recorded in 2007, but also break the 4 million mark to hit a new high this year, according to the Tourism Bureau.

In other words, our tourism hit a historical high last year and is booming this year. But according to AP, it is "flagging."

[Taiwan]