Political realities have prevented Taiwan from maintaining formal
ties with many of the world's important nations. In the interests
of facilitating trade and building foreign relations, the government
and its counterparts in many other countries have had to come
up with some creative solutions.
For decades, both Taiwan and China regarded diplomatic affairs as a "zero-sum" competition. The rule was simple: if either one established diplomatic relations with a particular country, the other would break ties with that nation. This "winner-takes-all" approach seemed to work to Taiwan's advantage for a period, discouraging diplomatic allies from considering recognizing Beijing, but the situation started to change when the Republic of China on Taiwan lost its membership in the United Nations in 1971. Within a year, the number of countries that retained diplomatic ties with the ROC dropped from sixty-eight to fifty-four. Dozens of others broke off formal relations with Taipei in the following years in order to establish official ties with Beijing, which took over the "China" seat formerly occupied by the ROC as a permanent member of the UN Security Council.
In the late 1980s, the ROC shifted its diplomatic policy to "double recognition," meaning that Taipei would be willing to keep or enter into diplomatic ties with other nations, regardless of whether they also recognized Beijing. The belated change of policy, however, did not have much impact on Taiwan's dealings with the rest of the world. "Most countries would love to have formal relations with both the ROC and the PRC, but this is simply not acceptable to Beijing, which still embraces the zero-sum policy," says Lo Chih-cheng, executive director of the Institute for National Policy Research, a private think tank. "Countries have had to take sides, and Beijing seems to be a better choice considering the political realities in the international community."
In the face of those setbacks, one of Taiwan's responses was to place greater emphasis on establishing diplomatic relations with developing countries, including many smaller states in Africa, the Caribbean, and the Pacific. But a far more important tack turned out to be the setting up of a new form of relationship with nations that had ended diplomatic ties. One of the first examples was the arrangement worked out with Japan after formal relations were severed in 1972. Nongovernmental organizations with close government connections were created--Taiwan's Association of East Asian Relations (AEAR) and its Japanese counterpart, the Interchange Association--to carry on economic, cultural, and other contacts between the two countries in the absence of embassies. Besides its mission in Tokyo, AEAR also runs branches in Fukuoka, Okinawa, and Yokohama, while the Interchange Association operates in both Taipei and Kaohsiung.
Another heavy diplomatic blow ensued in January 1979, when Washington shifted diplomatic recognition from Taipei to Beijing. To maintain substantive relations with Taiwan, the US Congress passed the Taiwan Relations Act authorizing the continuation of "commercial, cultural, and other relations between the people of the United States and the people on Taiwan." It also called for the establishment of a nominally private organization, the American Institute in Taiwan (AIT), to act as the operating agency. The US Department of State, which contracts the AIT to perform services on its behalf, provides funding and guidance for AIT's operations. Congress, as stipulated in the Taiwan Relations Act, assumes an oversight role with respect to the organization.
With more than 300 staff members in its Taipei and Kaohsiung offices, the AIT performs a range of duties such as issuing economic and political reports, assisting with agricultural and military sales, and providing commercial and visa services. On the Taiwan side, a counterpart agency--initially named the Coordination Council for North American Affairs--was formed to operate offices in Washington and in other major cities in the United States. Renamed the Taipei Economic and Cultural Representative Office in 1994, the Taiwan body is currently operating in thirteen locations in the United States.
Many other countries, while coming to the conclusion that the PRC was too big to ignore, also saw the necessity of establishing substantive relations with Taiwan because of its prominent standing in the world economy. The solution of setting up unofficial representative offices was a welcome model for nations seeking a pragmatic way to maintain connections with Taiwan without incurring Beijing's wrath. Lo Chih-cheng, who was formally chairman of the Ministry of Foreign Affairs' (MOFA) Research and Planning Board, points out that the setting up of each representative office requires going through a process of negotiations. "The principle should be equal and reciprocal treatment," he says. "But considering Taiwan's diplomatic difficulties and thus the vital importance to us of establishing substantive ties, we usually offer more than we are offered in return."
The scope of negotiations usually includes the names of the offices, their functions, the background of the representatives, and the kinds of diplomatic privileges and immunities to be enjoyed. Since governmental powers such as the issuing of visas and granting of diplomatic privileges are involved, the respective governments must ultimately take part in the negotiations behind the scenes. Given the lack of any precedent in international law or practice for these kinds of substantive relations, the early cases that had to be negotiated were fraught with difficulty. Even the names to be applied to the offices were often a sensitive issue, since some countries wished to avoid anything that even hinted at "official" status. The Filipino representative office in Taipei, for example, was originally called the Asian Exchange Center, a name easily mistaken for a stock or futures market. It was not until 1989 that the name was changed to the Manila Economic and Trade Office to better reflect reality.
The separate negotiations conducted with each of the countries resulted in a variety of terms being applied in the names of the newly established organizations. They have been variously called institutes, representative offices, economic and cultural offices, trade missions, business or trade centers, and liaison offices. The means of selecting the representatives and other personnel have also differed from office to office. While the staff in Taiwan's overseas offices are generally taken from the ranks of the country's foreign service, the delegates sent to Taipei by other countries might be professional diplomats, diplomats or other government employees on temporary leave from their official posts, or individuals drawn from research institutes or commercial organizations.
But regardless of the nomenclature and method of organization adopted, many of these unofficial offices have been empowered to exercise certain governmental powers such as issuing visas, notarizing documents, negotiating and signing investment and trade agreements, and handling consular matters for their nationals in Taiwan. In terms of privileges, they generally are granted many amenities similar to those given to full-scale diplomatic missions, including the equivalent of a diplomatic pouch, duty-free import, special license plates for automobiles (that are not embassy plates, but have the same privileges), and security services to protect their offices.
Although they are often viewed as de facto embassies, the most important work of these offices usually falls into "nonpolitical" areas. Hugues Mignot, director of the Belgian Trade Association established in Taipei in 1979, explains that the primary function of his office is to serve as a link between Belgian and Taiwanese organizations, companies, and individuals to promote trade, investment, and cultural exchanges between the two countries.
That is largely the role that most representative offices play. They respond to trade inquiries, provide market information, and assist in locating Taiwanese partners for companies and organizations in their own countries. They help trade visitors and commercial delegations to meet appropriate counterparts in Taiwan. They organize group seminars and road shows. They promote the investment environment in their countries to Taiwanese companies interested in setting up operations there. "Because of the absence of formal ties and the obstruction from the PRC, they keep a rather low profile about political or diplomatic matters," Lo Chih-cheng says. "Some of them even avoid entering the foreign ministry or other government agencies, just to show that they don't have any contact with our government."
In some cases, Taipei's overseas representative offices have had difficulty in getting established due to pressure from Beijing. This serves as a reminder to Taiwan that substantive relations cannot fully replace formal ties. "Taiwan has put a lot of effort into developing relations with foreign countries, and has been maintaining strong economic and even personal ties with those in foreign governments," notes Lee Ming, a professor at National Chengchi University's Department of Diplomacy. "But no matter how well substantive relations work, there are times, especially at critical moments, when formal ties would be more effective." One such example occurred in 1997, when civil unrest in Cambodia forced Taiwan businessmen to seek assistance from the PRC embassy after the Taipei representative office was not able to provide protection or the evacuation of its nationals from the troubled area.
Currently, Taipei has full diplomatic relations with merely twenty-seven countries, but maintains economic, cultural, or technical cooperation relations with more than 150 others. According to MOFA, a total of forty-six countries lacking formal relations with the ROC have established fifty-three representative offices or visa-issuing centers in Taiwan. The most numerous are the twenty-one offices run by seventeen European countries and the eighteen offices by twenty-one Asian or Pacific countries. For its part, Taiwan maintains ninety-five representative offices in sixty-two countries.
The number of representative offices has been increasing rapidly since the late 1980s, when Taiwan undertook some adjustments to its foreign and trade policies. One important change was the adoption of the model of "pragmatic diplomacy," first raised by Lee Teng-hui when he was sworn in as president in 1988. The policy was simple--take account of realities, then do what works. "The reality is that it isn't likely for us to establish formal ties with many countries," Lo says. "But even with the absence of formal ties, there is still plenty of room for promoting substantive relations."
Another step Taiwan took was to aggressively expand trade, as well as to diversify markets to reduce overdependence on the United States, which was then absorbing nearly half of Taiwan's exports. In 1987, Taiwan's trade surplus with the United States came to US$16 billion, or 86 percent of Taiwan's total trade surplus that year. In order to spread the risk and to respond to growing complaints from Washington about the imbalance, Taiwan began to actively encourage its businesses to look for alternative markets.
Among the potential new markets, one of the most promising was Eastern Europe, then in the process of transformation from central economic planning to a free-market system. To promote economic ties with these countries, Taiwan between 1990 and 1992 set up representative offices in the Czech Republic, Poland, and Hungary. The three countries also set up corresponding Taipei offices between 1993 and 1998. Judging from the statistics, these offices have succeeded in developing a considerable amount of business. Bilateral trade between Taiwan and the Czech Republic, for example, more than tripled--from US$22 million to $70 million--in the year following the opening of the Taipei office in Prague in 1990. The figure has since risen to $193.7 million in 2001.
Since many countries put economic considerations at the forefront of their foreign policies, a crucial reason for Taiwan's success in forging and maintaining substantive relations with other nations is its status as a prominent world trader. But although the focus is nonpolitical issues, the strengthened economic and cultural links frequently have a positive carry-over effect on promoting political ties. More countries, for instance, are now willing to allow Taiwan's political leaders and high-ranking government officials to visit, although they know it will bring them heavy pressure from the PRC. Then Premier Lien Chan visited the Czech Republic and Hungary in 1995, Vice President Annette Lu attended Liberal International's 2002 annual meeting in Budapest, Minister of National Defense Tang Yiau-ming went to the United States to meet American military leaders earlier this year, and Minister of Justice Chen Ding-nan this summer called on relevant agencies in the United States and Japan. Exchanges of visits by economic and finance officials are more common and less sensitive.
In April 2000, shortly after Chen Shui-bian was elected president, the European Parliament adopted a resolution complimenting Taiwan on its democratic achievements and requesting Beijing to solve cross-Strait issues peacefully. The resolution also called on member states of the European Union to step up their relations with Taiwan with a view to securing improved representation for Taiwan in international forums, and it reconfirmed the plan to open a European Commission representative office in Taipei. "Strengthened substantive relations tend to bind Taiwan's interests tightly with countries that have commercial ties with Taiwan," Lo says. "As a result, these countries need to pay close attention to what's happening in Taiwan and to take actions to protect or promote their interests here."
Whether the foreign representative offices in Taiwan or the Taiwanese offices abroad can be linked directly to "political side benefits" is hard to pinpoint, but the quantity of those offices shows how well Taiwan has maintained close ties with the other countries of the world. The "unofficial" status of these offices turned out to be a creative and effective solution in developing relationships in the absence of formal ties--a road less traveled and more rocky perhaps, but still one that brings Taiwan closer to its intended destination.