Abstract

Since Chinese president Hu Jintao took office in March 2003, Beijing has gradually developed a new approach to the Taiwan issue. The new strategy appears to be “speak softly and carry a big stick” toward proponents of Taiwanese independence and relying on Washington to rein in the proindependence Democratic Progressive Party on the one hand, and, on the other hand, actively seeking reconciliation with the anti-independence Chinese Nationalist Party by offering economic benefits to Taiwan and making limited concessions on some difficult bilateral issues—including the sovereignty issue—to promote better economic and social relations and to undercut support for Taiwanese independence. Although the new approach has contributed to the current reconciliation, there is no change in Beijing's fundamental principles, and the current rapprochement is largely limited to the area of economic cooperation. The long-term impact of the rapid economic integration should not be underestimated. Taiwan may also become socially and culturally integrated with the People's Republic of China, and the foundation will be laid for eventual reunification.

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