Chairman Shih, distinguished scholars, ladies and gentlemen:
It is a great honor to be invited to attend today's seminar on "Interpreting the Rise of China" hosted by the Institute for National Development.
The "rise of China" is a term which first emerged in the 1980s, when China embarked on its industrial reform and open-door policy. At that time, public attention was mainly focused on the vast commercial potential of the Chinese market. Whether in its role as a world factory or as a global market, people believed that China’s economic growth would bring more substantive benefits to the world. However, China has continued to expand its military over the past decade despite not facing any external military threat. It has attempted relentlessly to militarily intimidate Taiwan. It has become an increasingly active participant in the international community as its ambitions to play a leading role in the regional and international economy have become greater focus. All of these developments have alarmed the international community to the reality that, although the rise of China has brought commercial opportunity and profit, it has also created hidden threats and crises both for the region and the world. As global awareness of this fact spreads, the rise of China is becoming synonymous with the concept of the "China Threat." As a result, China has been forced in recent years to quickly establish a theory consistent with its slogan of "peaceful development." This September, Zheng Bijian, the former Executive Vice-President of the Central Party School of the Communist Party of China (CPC), published a paper in Foreign Affairs quarterly. The article is representative of China's arguments seeking to counter the idea of a "China Threat" and to whitewash the "rise of China." We can predict that China will invest heavily in human and material resources to promote a positive image of the "rise of China" in the global community. Taiwan is the main victim of China's military buildup and political oppression. Therefore, Taiwan must be a stronger presence in future international debate over the "China Threat" or the "peaceful rise of China." We must stand up and bear witness to the world and fulfill this crucial role.
The first question one needs to address when exploring the issue of the "rise of China" is the consequences of this rise.
The first consequence is, if China fails to democratize, its rise will certainly create a military force that will threaten global security. China has increased its military budget by ten percent annually over the past decade. In 2005, its military spending is anticipated to reach US$30 billion dollars (though the general international consensus is that China’s actual military spending is two to three times greater than the official figure it released). China is also progressing aggressively in the areas of R&D and deployment of strategic weapons. Some of these weapons have a force-projection capability covering India, Russia, Australia, New Zealand, and the entire U.S. They also include as many as 650 to 730 ballistic missiles targeted at Taiwan, exacerbating military imbalances between both sides of the Taiwan Strait. In its 2005 report on The Military Power of the People’s Republic of China, the U.S. Department of Defense clearly indicated that China is gradually developing as a regional power. At a symposium in Singapore this June and subsequently in an October interview, U.S. Defense Secretary Donald Rumsfeld said he was perplexed as to why, in the absence of an external threat, China would continue to expand its military deployment. In a speech to the National Committee on U.S.-China Relations in September, U.S. Deputy Secretary of State Robert Zoellick stepped up calls for greater military transparency in China. Moreover, the Japan Defense Agency issued its "Defense of Japan 2005 White Paper" in August, indicating that China's military expansion has exceeded the scope necessary for defense. In July 2005, Major General Zhu Chenghu, Dean of the Strategic Defense Institute at China's National Defense University, sparked an international uproar with statements about striking the U.S. with nuclear weapons. Such remarks have been taken to signify the Chinese military's readiness for a nuclear war. From all of these indications, we can see that the lack of democracy in China is the reason that its rise is likely to create a new and irresponsible military power in the world. Moreover, this has become a threat to global peace.
The second consequence of China's rise is that it has become more wasteful of global resources. Nearly 20 years of steady reforms have engaged most regions of China in active pursuit of economic development. A combination of blind investment and the persistent influence of state ownership systems have encouraged a general disregard of costs in most production activities. This is particularly true in the consumption of air, water and other public assets. In recent years, problems such as desertification, water pollution, air pollution, reduction of arable land, depletion of lake area, excessive energy waste, and amassment of global energy resources have arise. If these aftereffects are allowed to spread and deteriorate, they will become a collective burden for all human beings.
The third consequence of the rise of China is that it has become an economic powerhouse as well as an economic monster. From 1979 to 2004, the annual per capita GDP in China rose from US$181 to US$1,200 dollars. During the same period, the value of external trade increased from US$20 billion to US$1.15 trillion dollars, making China the world's third-biggest trading nation. In 2004, China had the sixth-biggest GDP in the world (after the United States, Japan, Germany, the U.K. and France). Its combined import and export value topped US$1 trillion dollars; and its actual utilized foreign investment exceeded US$60 billion dollars. As China rises, it will undoubtedly become a new consumer market of enormous commercial opportunity. But China will also take advantage of its cheap labor and planned economy to steadily control international markets, capital and technology, and to compete with other countries for energy and other scarce resources. China's economic development would be an invaluable asset to the world if it were based on a fair and competitive free market system. However, China has not competed with the rest of the world on a fair footing. Rather, it has adopted hard-line controls on foreign exchange and exchange rates, refused to fully open the domestic market and engaged in large-scale dumping. It has also introduced national subsidy measures in various covert forms. In particular, political factors often determine the direction and approval or rejection of foreign investment. These distorted economic behaviors, combined with a sustained high-level economic growth, will likely turn China into a giant economic monster beyond the international control and regulation. This would undoubtedly be detrimental to the international trend toward freer trade.
The last consequence of the rise of China is that it has become an obstacle to political democratization. According to China's State Statistical Bureau, the richest ten percent of the population in the country controls 45% of the national wealth; while the poorest 10% owns only 1.4% of the nation's riches. The gap between the rich and the poor will also continue to widen in the next ten years. In 2004, there were around 74,000 demonstrations in China. Several of these quickly developed into large-scale and highly organized protests with high degree of violence. These demonstrations reveal a deep-rooted and growing resentment among the Chinese public. They also reveal a surging trend of social unrest that could erupt at any time into a full-scale outburst and threaten regional security. The rise of China is built on a foundation of potential social and economic upheaval and strict political control. In particular, China has exercised substantive political control over Hong Kong since 1997. Since 1999, China has progressively enforced stricter domestic controls on the freedoms of assembly, speech and the press. Furthermore, it has criticized and shown anxiety over Taiwan's democratic achievements. These are all reasons to believe that, in order to further secure the position of their one-party dictatorship under sustained economic development, the Chinese authorities are disguising and suppressing internal social unrest and inciting nationalist sentiments. They are also consolidating their ruling power in the name of suppressing domestic and external political dissidence. In other words, the rise of China is providing the Chinese authorities with excuses to justify their suppression of democratization. Therefore, China’s democratization is likely to become the main victim of the "rise of China."
China's unconventional rise is a fact and a problem that the entire world must boldly confront. A common mission of humanity in the twenty-first century will be to find a way to utilize global force and steer China in the right direction of development, so that it may become a democratic and responsible nation. Taiwan faces an unprecedented security threat from China. Moreover, Taiwan's existence in the region and the world are constantly under threats and hindrances. However, as a member of the international community, Taiwan has joined the ranks of democratic nations. It is currently the country with the closest relations with China. We are ready to confront this problem and fulfill our duty as a member of the international community. Therefore, advocating Taiwan's position and value is the key to guiding the course of China's rise.
Firstly, Taiwan pledges to faithfully carry out its responsibility as a member of the Asia-Pacific region. It will uphold regional peace and stability and actively seek reconciliation and improvement in its relations with China, to become a central force in regional peace and security. However, we would like to appeal to the international community to face up to the various adverse effects of China’s rise. This includes facing up both to China's attempts to strengthen and integrate its national power, as well as to the nature of the Chinese regime. We need to be especially aware that China's intentions to dictate regional affairs could lead to a strategic imbalance in the Asia-Pacific region, as well as create regional tension and negative international impact. There is also a need for the international community to monitor China's actions and fully use its strength to jointly take on the task of safeguarding peaceful development and prosperity in the Asia-Pacific region.
Secondly, the government of Taiwan has firmly stood by the basic principle of "reconciliation does not mean retreating" and "standing firm does not mean opposing" in promoting cross-strait relations. It has made every effort to uphold the status quo in the Taiwan Strait and prevent the Chinese government from unilaterally changing or undermining this status quo. Nevertheless, serious military imbalance created by China in the Taiwan Strait through its arms buildup has compelled Taiwan to upgrade its self-defense ability, develop sound risk management and response mechanisms, strengthen the concept of all-out defense, and acquire defensive weapons sufficient to protect the life, freedom and property of its 23 million people. Moreover, as the Chinese government continues to use cross-strait exchanges as means to achieve its political goals, Taiwan will cautiously manage and plan such exchanges to safeguard our social stability and national security. We hope to exert greater positive influence on cross-strait relations and also ensure Taiwan's national identity.
Lastly, the accomplishment and value of Taiwan's hard fought democratic development are common assets belonging to not only the 23 million Taiwanese people, but also all of humanity. Taiwan’s efforts and achievements in consolidating and strengthening democracy in recent years can provide a true paradigm for China's "peaceful awakening" and "democratic development." Taiwan's extensive experience in democratic reform is deeply rooted in the hearts of Taiwan's 23 million people and has given the people unlimited strength. These are our most important assets when promoting closer cross-strait exchanges. Taiwan is willing to share with the Chinese people its experience in democratic development so that an additional one-fifth of the world's population may enjoy a democratic life and basic human rights. We are also ready to join forces with the international community—governments, NGOs and individuals included—to lead China toward the path to democracy.
I have presented here a few humble views on which I hope you may offer your guidance. I would also like to wish today's conference and everyone here the fullest of success.