August 19th 2006

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Articles from this issue:

CANBERRA OBSERVED: Inflation: next test for the Howard Government

EDITORIAL: Israel sucked into war in Lebanon

HUMAN RIGHTS: Sensational evidence of Chinese body-harvesting

ENERGY: Nuclear power stations our safest option - Dr Dennis Jensen

ETHANOL: Federals still to come to their senses on bio-fuels

INTERNATIONAL TRADE: Doha trade negotiations collapse irretrievably

SCHOOLS: Some religions are more equal than others

STRAWS IN THE WIND: Here come the anti-Semites / Robert Manne / The poverty of nations / Speculations

SPECIAL FEATURE: How Christians overcame the culture of death

ISRAEL: The endless mutations of anti-Semitism

EASTERN ASIA: Australia and Taiwan's special relationship

OPINION: Robert Manne - the case against

Swan song of failed educationalists? (letter)

Whitlam's attempts to diminish states (letter)

China atrocities exposed (letter)

BOOKS: HOME-ALONE AMERICA: The Hidden Toll of Day Care, by Mary Eberstadt

BOOK REVIEW Intellectual forerunner of the Movement

Books promotion page

Australia and Taiwan's special relationship

by Jeffry Babb

News Weekly, August 19, 2006
For a relationship beholden to the "one China" policy, and Canberra's official infatuation with Beijing, Australia-Taiwan ties are in surprisingly good shape, writes Jeffry Babb.

This year marks the official celebration of 25 years of "unofficial" relations between Australia and Taiwan.

Back in 1981, when the "representative" Australian Commerce and Industry Office opened, Australia-Taiwan trade was growing at 20 per cent a year, based on the complementarity of the two economies. That has slowed, but Taiwan is still a big trading partner of Australia - in fact, it is Australia's tenth biggest trading partner, and seventh biggest export market.

For a relationship beholden to the "one China" policy, and Canberra's official infatuation with Beijing, Australia-Taiwan ties are in surprisingly good shape.

Australia has about the same population as Taiwan, which has some 23 million people. Like Taiwan, Australia is a major trading nation. Australia's traditional exports of primary products are now being joined by high-tech and elaborately transformed manufactures, such as the world-famous cochlear bionic ear.

The role Taiwan played in the Australian market a generation ago has been supplanted by China, which now supplies Australia - as it does much of the world - with the consumer products, clothing, textiles and gadgets that Taiwan once provided.

This leads to an interesting observation - that Taiwan and Australia are in similar economic circumstances. Globalisation is the force that is remaking economies around the world.

Taiwan is no longer a poor country. Per capita GDP is now around US$15,300. Young people have no aspirations to work in sweatshop industries like garment-making. Manufacturing, construction and any sort of dirty, dangerous and boring work is left to "guest workers".

Some 80 per cent of high-school graduates will go on to higher education. Industries like clothing and footwear have long departed to China, Vietnam and other less well-off countries, although the textile-making industry, while lacking much official encouragement, has gone upmarket and continues to prosper.

Somewhat ironically, the first anti-dumping action taken by Taiwan against China in the World Trade Organization was over imports of towels - just the sort of thing that Taiwan used to say was "interference with trade" when Australian manufacturers made similar claims.

China factor

As far as Taiwan is concerned, one factor looms above all others - China.

Taiwan is a Chinese society, and its culture is strikingly similar to China. The same holidays are celebrated, and Mandarin Chinese is the official language of both Taiwan and China. Most Taiwanese speak Hoklo, or Hokkien, the dialect which is spoken in China's Fujian Province, whence most Taiwanese trace their roots.

Some one million Taiwanese live and work in mainland China. The amount of money Taiwanese businessmen have invested in China is staggering - somewhere over US$100 billion. Trade with the mainland must go through a third port - usually Hong Kong - but it is estimated that mainland China takes some 38 per cent of Taiwan's exports.

But the so-called "three direct links" - air travel, direct shipping and postage - is still incomplete.

The "three links" are a hot topic among businessmen, who see a further bonanza across the Taiwan Strait. While the administration of President Chen Shui-bian has made some tentative gestures, his independence-leaning Democratic Progressive Party - and the "deep green" Taiwan Solidarity Union - are hostile to being "brought over" by China.

The fact is China sees trade as an instrument of foreign policy - and this must be taken into account when assessing the desirability of Australia's own free trade agreement (FTA) now under negotiation between Canberra and Beijing.

As far as government-to-government cooperation is concerned, Australia has strong links with Taiwan. There is a healthy relationship at the municipal level. The acting mayor of the southern port-city of Kaohsiung was in Australia seeking investment in a number of infrastructure projects.

Australia also has a whole range of memorandums of understanding with Taiwan, which have often provided an early entry into agreements, setting the pattern for other countries.

At the people-to-people level, Taipei's Mayor Ma - seen by the opposition Kuomintang as president-in-waiting - has been to Australia several times. Only a very small number of people are not offered visas for political reasons, sources say.

Some 100,000 tourists visit Australia each year, and there are a large number of settlers from Taiwan in Australia - about half of whom make their homes in south-eastern Queensland, which has a climate similar to Taiwan's.

Then there are the 10,000 students from Taiwan who are in Australia at any one time. Australia is now the third biggest destination for Taiwanese students, behind only the United States and the United Kingdom.

Also, young people from Taiwan are among a select few who are offered working holiday visas, allowing them to stay in Australia for up to two years. A tourist visa application for Australia can be turned around in 24 hours normally.

- Jeffry Babb is a Taipei-based journalist.

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