Ms. Margaret Driscoll, Acting Chairperson of the American Chamber of Commerce in Taipei (AmCham);
Mr. Kurt Tong, Principal Deputy Assistant Secretary of the Bureau of Economic and Business Affairs;
Mr. Kin Moy, Director of the American Institute in Taiwan;
Mr. Liu Da-Nien (劉大年), Deputy Secretary-General of the National Security Council;
Mr. Andrew Jen-Chuan Kao (高振群), Deputy Secretary-General of the National Security Council;
Mr. David Y. L. Lin (林永樂), Minister of Foreign Affairs;
Mr. Chu-Chia Lin (林祖嘉), Minister of the National Development Council;
Members of the AmCham;
Honored guests;
Ladies and gentlemen:
Good evening!
I am very happy to be here today for AmCham's 2016 Hsieh Nien Fan (謝年飯). This is the 14th time I've been able to attend this event. Because the food here is good!
In another 10 days, we will commemorate the 37th anniversary of the day the Taiwan Relations Act (TRA) became effective. So to be here together with so many American friends, on the eve of an anniversary that is so important to both countries, is especially significant.
I. A retrospective look at the strong and abiding friendship between the Republic of China and the United States
Last year marked the 70th anniversary of the end of World War II, and the ROC's victory in the War of Resistance Against Japan. During that war of resistance, many friends from the US rendered great assistance to our country. So last year we invited many of the international friends who helped us during that period, and their descendants, to participate in our country's commemorative activities. After the war ended, American assistance also made a critical contribution to the ROC's survival and development. So we have specially prepared a small pamphlet to mark the occasion today. It's been placed on the table in front of you for your perusal. Please do join us to commemorate this precious period in history, and the long and abiding friendship between the Republic of China and the United States. For the Taiwanese in the audience, please give a big hand to our American friends for their contribution in helping the Republic of China.
By the way, of all the information you have in that pamphlet, I think the most touching statement was one from Dr. Robert Wilson, who stayed in Nanjing before the Japanese forces came in. And before that, he sent his wife and newborn baby back to the United States, and he himself stayed for the whole period of the Nanjing Massacre. He helped, I think, at least 10,000 Chinese during that period. Sixty years later, when his wife was asked, "Why did your husband do that, when he could have gone to the United States?" She responded, "He said that 'The Chinese are my compatriots.'" This is the most touching sentence I have ever heard. So I want to show how much we appreciate a lot of things we received from our American friends at that time.
II. Contributions that eight years of reform have made to creating a free, prosperous, and just Taiwan society
During my eight years as President, although we have faced many difficult situations, both internal and external, our administration has staunchly and steadily made progress toward our policy goals: a free, just, and prosperous Taiwan; a peaceful Taiwan Strait; and a friendly international environment.
To create that free, just, and prosperous Taiwan, we adopted sound policies that advocate openness and engagement, fostering free trade and a tourism-friendly environment. These policies have helped push tourist arrivals over the 10 million mark, and turned Taiwan into a major tourist destination.
Our efforts to foster freedom are reflected in the most recent Freedom in the World 2016 survey, issued by the New York-based Freedom House. That report has categorized Taiwan as a "free country" for 17 consecutive years, ranked No. 2 in Asia, behind only Japan.
In addressing economic development, over the past eight years we have seen the worst economic recessions since the oil crisis in the 1970s. They included the global financial tsunami in 2008, the European debt crisis in 2011, and the decline in global exports of 2015. During that same period, global economic growth averaged only 2.2%. Before I became President, it was 3.4%. Over the past eight years, global export growth averaged 3.4%. That's far below the 12.13% growth in the eight years before I took office. So even under such adverse circumstances, Taiwan's performance rankings improved, and in many areas, including economics and social progress, our achievements garnered high marks in international surveys.
One example is the most recent Bertelsmann Transformation Index (BTI), released by the Germany-based Bertelsmann Foundation. In that survey's Political Transformation category, Taiwan ranked No. 3 out of 129 countries worldwide.
In the BTI's Economic Transformation ratings, Taiwan was even more successful, ranking No. 1 out of 129 countries. The BTI report also praised Taiwan's economy for achieving solid growth over the past few years even though there was a severe downturn in global demand. At the same time, Taiwan's inflation was low, and financial institutions were stable.
In the US-based Global Finance magazine's ratings of the world's richest countries from November of last year, Taiwan ranked 19th out of 185 countries worldwide. That put us right behind Germany, and far ahead of countries like France, Great Britain, Japan, and South Korea.
And in the 2015 global competitiveness ratings published by the Institute of Management Development (IMD), in Lausanne, Switzerland, Taiwan ranked No. 11 in the world, and No. 3 in the Asia-Pacific Region. Over the past eight years, our average global rank was 11.5. That 11.5 average was better than the ranking averages of 15.5 and 16 achieved by my two predecessors as President, and the country's best performance in the past 20 years.
On December 9 last year the UK-based Open Knowledge foundation also released its Global Open Data Index. The results showed that although Taiwan was ranked No. 36 three years ago, and No. 11 two years ago, last year we climbed all the way to the top spot, ranked No. 1 in the world. Why don't you give us a big hand!
Last year's MasterCard Next Generation Well-Being Index survey also projected an index score of 80 for Taiwan's young generation in the year 2030, the highest score in all of Asia.
III. Peace dividend expands international space, makes Taiwan a peacemaker and provider of humanitarian aid
In seeking to create cross-strait peace under the framework of the ROC Constitution, we have maintained the status quo, which we define as "no unification, no independence, and no use of force." At the same time, based on the 1992 Consensus, that is "one China, respective interpretations," we have promoted the peaceful development of cross-strait relations. To date, the two sides have signed 23 agreements, and the respective ministers in charge of cross-strait affairs have met seven times, addressing each other using their official titles. In a little over seven years, the number of regularly scheduled weekly flights between the two sides has increased from zero to 890, and mainland tourists have made over 18 million visits to Taiwan. We now also have over 42,000 mainland students studying in Taiwan, a 50-fold increase.
Well, so many students from mainland China in Taiwan. Four years ago when I won my re-election victory, two students—one from mainland China and one from Taiwan—were interviewed by The New York Times. They were looking at the election results, and the Taiwanese student said, "Look how efficient our electoral system is. We cast our votes in the morning, and get the results in the evening!" The mainland student said, "That's nothing. At home, we also cast our votes in the morning. But we knew the result the day before!"
So this is an occasion to appreciate the value of student exchanges, and the very strong sense of humor of many students.
So cross-strait trade is now worth 160 billion US dollars a year, with an annual surplus of US$70 billion for Taiwan. That means over the past eight years, cross-strait trade has generated a trade surplus of almost US$600 for Taiwan, while our global trade surplus has been about US$250 billion. So you can see, without the surplus we generate from trade with the mainland, we would have a massive global trade deficit. That tells you just how important cross-strait trade is.
Then, friendly cross-strait interaction over the past eight years has also yielded a significant peace dividend in the international arena. First, the development of Taiwan-US relations and the trilateral interaction involving the US, Taiwan, and the mainland over the past eight years have led to the warmest relations in over 60 years. This is the first time all three parties have been able to have friendly interactions with the other two at the same time, and not worry about adverse reactions. That situation has drawn praise from many US government officials.
For example, during a speech in May of last year, US Deputy Assistant Secretary of State for East Asian and Pacific Affairs, Susan Thornton, publicly acknowledged that Taiwan-US relations have never been better. She also emphasized that "an important ingredient of the close cooperation in recent years has been the stable management of cross-Strait ties."
In a commentary published on the 26th of last month, former US Deputy Secretary of Defense Rudy deLeon also praised the positive effects of the 1992 Consensus, which allows the two sides of the Taiwan Strait to have a constructive dialogue, and resolve important issues. He also had good things to say about our "no surprises" policy, because it has allowed Beijing and Washington to directly interact with Taiwan.
All of these comments from Americans attest to the positive impact that cross-strait relations have had on Taiwan-US relations.
In external relations, this administration has promoted a pragmatic, dynamic, flexible diplomacy. That approach helped us return, with dignity, to international organizations like the World Health Assembly (WHA) and the Assembly of the International Civil Aviation Organization (ICAO). Back in 2007, before I took office, only 54 countries and areas offered Taiwan nationals visa-free courtesies. Since then, we have more than tripled that number, adding 110 more countries and territories for a total of 164. Eight years ago, that would have been simply impossible.
In 2012, to address sovereignty disputes involving the islands in the East China Sea, we proposed the East China Sea Peace Initiative. Based on the concept that although sovereignty over national territory cannot be compromised, natural resources can be shared, it calls on all concerned parties to replace confrontation with dialogue, and resolve disputes through peaceful means. In April of the following year, 2013, we successfully signed a fisheries agreement with Japan that ceded nothing in terms of sovereignty, yet made great strides in terms of fishing rights. That agreement resolved fisheries disputes that had plagued us for over four decades, and the number of maritime disputes dropped from 17 per year to zero, while our fishermen's catches tripled. Everyone is happy—Japan, Taiwan, the US, Australia, and the European Union, but with only one exception, who is not happy. Do you know who? I think you probably guess it's mainland China. No. It's not mainland China. The only one party which is not happy is the fish.
Because we now catch three times more fish than we did in the past. Particularly yellowfin tuna.
Anyway, we then applied the same concepts in the South China Sea, and in May of last year I proposed the South China Sea Peace Initiative. By November, we had signed an agreement with the Philippines that prescribes law enforcement procedures for fishing operations. That agreement will cut down the number of fisheries disputes that have occurred in our overlapping exclusive economic zones for the past 40 years, while making Taiwan a regional peacemaker.
At the same time, we have worked hard to be a provider of humanitarian aid in the international community. Whenever there's an earthquake, tsunami, or typhoon, whenever war or famine strike—from Haiti to Japan, from the Philippines to Syria, from West Africa to the Caribbean, from Nepal to El Salvador, from Iraq to Guatemala—we have been there to provide relief supplies, donations, and services.
Two weeks ago, US House Committee on Foreign Affairs Chairman Ed Royce stated that Taiwan's international assistance has shown how effective our humanitarian aid is, and also demonstrated the inherent goodwill of our people, fostering peace in the international community.
IV. Taiwan's future: Three key issues
I also want to take this opportunity today to look at Taiwan's prospects for the future through the lens of three key issues. The first issue is cross-strait relations.
Because the two sides of the Taiwan Strait had accumulated enough mutual trust, and predicated on equality and dignity, on November 7 last year I met with mainland Chinese leader Xi Jinping (習近平) in Singapore to exchange views about consolidating cross-strait peace and maintaining the status quo in the Taiwan Strait. That meeting was a sign that the current cross-strait leaders have already established a communication mechanism to resolve disputes through peaceful means, setting a positive example for the international community.
As you know, when I met Mr. Xi in Singapore, we adopted different formalities that were never used before. Neither of us mentioned the country we represent. Neither of us used our official titles. For the costs of the banquet—we go Dutch. And for the beverages, we brought in our own. I brought in gao liang [liquor], and Mr. Xi brought mao tai [liquor]. And I noticed that he drank more gao liang than mao tai. So we sent all the remaining gao liang to Mr. Xi as a gift.
During the presidential election in January of this year, the three candidates all advocated maintaining the status quo that we have created over the past eight years. So that constitutes the clearest "Taiwan Consensus." But creating the current status quo of peace and prosperity was no easy task. So if our President-elect can truly abide by the ROC Constitution, and keep peace in the Taiwan Strait uppermost in mind, then accepting the 1992 Consensus, which is derived directly from the ROC Constitution, shouldn't be too much of a problem. The 1992 Consensus is not just a KMT-CCP (Chinese Communist Party) Consensus. It's not just a Taiwan Consensus. It's a cross-strait Consensus—and a solid foundation for the peaceful development of cross-strait relations.
I think most of you may think that the 1992 Consensus—"one China, respective interpretations"—is very vague. Yes, quite a few people call that a "masterpiece of ambiguity." Ambiguous or not—it worked. And it worked very well.
So, the second key issue is energy.
From an objective standpoint, the DPP's (Democratic Progressive Party) proposed energy development goals are overly optimistic. This month is the fifth anniversary of the Great East Japan Earthquake. That year, the Japanese government completely abandoned nuclear energy and imported an enormous amount of natural gas to replace nuclear energy. But during that five-year period, their external trade surplus of 6 trillion yen in the year 2010 changed into a 13 trillion yen trade deficit. Electricity rates rose 20%. But what really stands out is that most of the countries that announced a target date for abandoning nuclear power have already backtracked. That includes Japan, Belgium, and Switzerland. That leaves Germany fighting an uphill battle—alone.
So where should Taiwan go from here?
The energy challenge is already upon us. That means we need to keep three prerequisites in mind: no power rationing, maintaining reasonable power prices, and making good on our pledges to the international community to reduce carbon emissions. Then we can steadily and systematically reduce our reliance on nuclear energy. But we can't just rashly abandon it, because we can't afford to give up any single option. What we need to do is carefully select the optimum energy mix for Taiwan.
The last key issue is economic development.
To address the trends toward global economic liberalization and regional integration, Taiwan cannot stand apart from the mainland market and the international community, always on the outside looking in. Under American leadership, the Trans-Pacific Partnership agreement (TPP) was signed on February 4 this year. After many rounds of negotiations, we can also expect the Regional Comprehensive Economic Partnership agreement (RCEP), led by the ASEAN countries, to be signed this year. So Taiwan has to treat participation in regional economic integration as an urgent issue, and pick up the pace. Our economic structure and existing economic advantages can only reach their full potential by embracing a more open market. That makes regional economic integration a choice that the next administration and the people of Taiwan cannot avoid.
V. Conclusion
Well, over the past eight years, we have had considerable success in achieving our policy goals, promoting "a free, just, and prosperous Taiwan," "a peaceful Taiwan Strait" and a "friendly international environment." We have built substantive bridges, and laid a firm foundation to address issues like cross-strait relations, economic construction, and energy policy. Instead of being indebted to the international community, the Republic of China has become a valuable asset.
Looking ahead to the challenges of the future, I hope that the next administration will show mature wisdom, continue to maintain the cross-strait status quo of peace and prosperity based on the 1992 Consensus, and actively pursue regional economic integration. I also hope they will find the most appropriate energy mix for Taiwan, and contribute to regional and global stability and prosperity.
So once again, let me thank AmCham for their gracious invitation. Let's all hope that in the coming year, Taiwan-US relations will reach new heights. And last but not least, let me wish all of you and your families good health, good luck, and much success in the coming Year of the Monkey.
Thank you very much!