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RENEWING ASSURANCES:

STRENGTHENING U.S.-TAIWAN TIES

HEARING

BEFORE THE

SUBCOMMITTEE ON ASIA AND THE PACIFIC

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FIFTEENTH CONGRESS

FIRST SESSION

JUNE 15, 2017

Serial No. 115–43

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

ADAM KINZINGER, Illinois 

LEE M. ZELDIN, New York 

DANIEL M. DONOVAN, JR., New York 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

ANN WAGNER, Missouri 

BRIAN J. MAST, Florida 

FRANCIS ROONEY, Florida 

BRIAN K. FITZPATRICK, Pennsylvania 

THOMAS A. GARRETT, JR., Virginia 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

KAREN BASS, California 

WILLIAM R. KEATING, Massachusetts 

DAVID N. CICILLINE, Rhode Island 

AMI BERA, California 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania 

DINA TITUS, Nevada 

NORMA J. TORRES, California 

BRADLEY SCOTT SCHNEIDER, Illinois 

THOMAS R. SUOZZI, New York 

ADRIANO ESPAILLAT, New York 

TED LIEU, California

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

SUBCOMMITTEE ON ASIA AND THE PACIFIC

TED S. YOHO, Florida, Chairman 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

TOM MARINO, Pennsylvania 

MO BROOKS, Alabama 

SCOTT PERRY, Pennsylvania 

ADAM KINZINGER, Illinois 

ANN WAGNER, Missouri 

BRAD SHERMAN, California 

AMI BERA, California 

DINA TITUS, Nevada 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

TULSI GABBARD, Hawaii 

(III)

C O N T E N T S 

Page

WITNESSES 

Mr. Rupert J. Hammond-Chambers, president, U.S.-Taiwan Business Council 7

Mr. Dan Blumenthal, director of Asian studies and resident fellow, American 

Enterprise Institute ............................................................................................. 24

Mr. Russell Hsiao, executive director, Global Taiwan Institute .......................... 30

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Ted S. Yoho, a Representative in Congress from the State 

of Florida, and chairman, Subcommittee on Asia and the Pacific: Prepared 

statement .............................................................................................................. 3

Mr. Rupert J. Hammond-Chambers: Prepared statement ................................... 10

Mr. Dan Blumenthal: Prepared statement ............................................................ 26

Mr. Russell Hsiao: Prepared statement ................................................................. 33

APPENDIX 

Hearing notice .......................................................................................................... 60

Hearing minutes ...................................................................................................... 61

Written responses from Mr. Rupert J. Hammond-Chambers and Mr. Russell 

Hsiao to questions submitted for the record by the Honorable Ann Wagner, 

a Representative in Congress from the State of Missouri ................................ 62

(1)

RENEWING ASSURANCES: STRENGTHENING 

U.S.-TAIWAN TIES 

THURSDAY, JUNE 15, 2017

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON ASIA AND THE PACIFIC,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The subcommittee met, pursuant to notice, at 2:45 p.m., in room 

2200 Rayburn House Office Building, Hon. Ted Yoho (chairman of 

the subcommittee) presiding. 

Mr. YOHO. The subcommittee will come to order. For those of you 

that were present and you saw Republicans and Democrats on both 

sides, that wasn’t dysfunction. That was to show you the Foreign 

Affairs Committee is very well united and that was done purposely, 

right? 

The subcommittee will come to order. Members present will be 

permitted to submit written statements to be included in the official hearing record. Without objection, the hearing record will remain open for 5 calendar days to allow statements, questions, and 

extraneous material for the record subject to length, limitations, 

and the rules. 

Good afternoon. Taiwan has received significant attention in 

Congress since last year—excuse me—has not received significant 

attention in Congress since last year. At that time, the focus was 

on the campaign and later the victory of President Tsai Ing-wen, 

and the mood was optimistic and celebratory. 

Since that time, unfortunately, Taiwan’s international outlook 

has become increasingly cloudy. Just this week, Panama severed 

diplomatic ties with Taiwan and recognized the People’s Republic 

of China, a gut-wrenching loss for Taiwan’s dwindling diplomatic 

recognition. Last month, the PRC blocked Taiwan’s delegation from 

attending the World Health Assembly in Geneva, the annual gathering of the World Health Organization, despite the fact that Taiwan has regularly attended the summit and has been an international force for good in the health space. It is not only Taiwan’s 

loss, but the world’s as diseases know no borders. 

Since President Tsai’s election, the PRC has escalated a global 

campaign to squeeze Taiwan’s international recognition out of existence. Taiwan’s security situation is being challenged alongside 

its diplomatic presence. The PRC has undertaken unprecedented 

military provocations around Taiwan in recent months. In November of last year, China flew aircraft around the perimeter of Taiwan’s Air Defense Identification Zone for the first time. In JanuVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
2

ary, the PRC sailed the Liaoning, its first aircraft carrier, through 

the Taiwan Straits. 

These actions, the PRC’s increasing global military ambition, and 

its belligerence in the East and South China Seas have contributed 

to an environment of instability. However, the United States has 

not completed an arms sale to Taiwan since 2015, though the Taiwan Relations Act requires the United States to offer the necessary 

equipment for Taiwan’s self-defenses capabilities. 

Successive administrations have shown a lack of resolve in executing our defense commitments to Taiwan, emboldening the PRC 

which remains uncommitted to a peaceful resolution of Taiwan’s 

status. Our most recent arms sales was in 2015, and the prior sales 

were years apart. Since 2008, sales have been delayed so that they 

can be bundled together and their timing can be manipulated. The 

arms sales process has become a political calculation designed to 

minimize friction with the PRC. Not only does this concede to Beijing a degree of influence over our arms sales process, it seems to 

contravene President Reagan’s assurance that the PRC would not 

be consulted on arms sales to Taiwan. 

Economic pressure on Taiwan is increasing as well. Taiwan has 

long been a developed, high-tech economy, and is especially dependent on international trade for its prosperity and economic 

growth. But the PRC’s massive and growing economic clout grants 

it the ability to exclude Taiwan from trade agreements and to use 

economic pressure to change other nations’ policies toward Taiwan. 

It is astonishing to think that the backwards, isolated PRC of 

1979 could someday bring this level of diplomatic, security, and 

economic pressure to bear. This geopolitical reality that was held 

when we established our One China Policy has changed. The People’s Republic of China is no longer the third party to a great 

power competition between the United States and the Soviet 

Union. It has become a challenger, seeking to attain great power 

status for itself by overturning a peaceful unipolar order. 

Despite this, our One China Policy has remained virtually unchanged since 1979. It is important for Congress to consider whether our policies are still serving us well and how we might improve 

them. In particular, renewing our assurances to Taiwan to continue 

and steadfast U.S. support is especially important. 

We have convened this hearing today to work toward these goals, 

and I thank the witnesses and I thank my colleagues for joining 

me today to help strengthen U.S.-Taiwan ties. And, without objection, the witness’ written statement will be entered into the hearing, and I now turn to the ranking member for any remarks he 

may have. 

[The prepared statement of Mr. Yoho follows:]

3


25846e-1.eps

Opening Statement of the Honorable Ted Yoho (R-FL), Chairman 

House Foreign Affairs Subcommittee on Asia and the Pacific Hearing: 

"Renewing Assurances: Strengthening U.S.-Taiwan Ties" 

June 15, 2017 

(As prepared for delivery) 

Good afternoon. Taiwan has not received significant attention in Congress since last year. At 

that time, the focus was on the campaign and later the victory of President Tsai lng-wen, and 

the mood was optimistic and celebratory. Since that time, unfortunately, Taiwan's international 

outlook has become increasingly cloudy. 

Diplomatic Pressure and International Space 

Just this week, Panama severed diplomatic ties with Taiwan and recognized the People's 

Republic of China, a gut wrenching loss for Taiwan's dwindling diplomatic recognition. Last 

month, the PRC blocked Taiwan's delegation from attending the World Health Assembly in 

Geneva, the annual gathering of the World Health Organization, despite the fact that Taiwan 

has regularly attended the summit and has been an international force for good in the health 

space. It is not only Taiwan's loss, but the world's as diseases know no borders. 

Since President Tsai's election, the PRC has escalated a global campaign to squeeze Taiwan's 

international recognition out of existence. 

Security and Economic Environment 

Taiwan's security situation is being challenged alongside its diplomatic presence. The PRC has 

undertaken unprecedented military provocations around Taiwan in recent months. In 

November of last year, China flew aircraft around the perimeter of Taiwan's Air Defense 

Identification Zone for the first time. In January, the PRC sailed the Liaoning, its first aircraft 

carrier, through the Taiwan Strait. 

These actions, the PRC's increasingly global military ambitions, and its belligerence in the East 

and South China Seas have contributed to an environment of instability. However, the United 

States has not completed an arms sale to Taiwan since 2015, though the Taiwan Relations Act 

requires the United States to offer the necessary equipment for Taiwan's self-defense 

capability. 

Successive administrations have shown a lack of resolve in executing our defense commitments 

to Taiwan, emboldening the PRC, which remains uncommitted to a peaceful resolution of 

Taiwan's status. Our most recent arms sale was in 2015, and the prior sales were years apart. 

Since 2008, sales have been delayed so that they can be bundled together and their timing can 

be manipulated. 
4


25846e-2.eps

The arms sales process has become a political calculation designed to minimize friction with the 

PRC. Not only does this concede to Beijing a degree of influence over our arms sales process, it 

seems to contravene President Reagan's assurance that the PRC would not be consulted on 

arms sales to Taiwan. 

Economic pressure on Taiwan is increasing as well. Taiwan has long been a developed, hightech economy, and is especially dependent on international trade for its prosperity and 

economic growth. But the PRC's massive and growing economic clout grants it the ability to 

exclude Taiwan from trade agreements, and to use economic pressure to change other nations' 

policies towards Taiwan. It is astonishing to think that the backwards, isolated PRC of 1979 

could someday bring this level of diplomatic, security, and economic pressure to bear. 

The Future of U.S. Policy for Taiwan 

The geopolitical reality that held when we established our "One China" policy has changed. The 

People's Republic of China is no longer the third party to a great power competition between 

the United States and the Soviet Union. It has become a challenger, seeking to attain great 

power status for itself by overturning a peaceful unipolar order. 

Despite this, our "One China" policy has remained virtually unchanged since 1979. It is 

important for Congress to consider whether our policies are still serving us well, and how we 

might improve them. In particular, renewing our assurances to Taiwan of continued and 

steadfast U.S. support is especially important. We've convened this hearing today to work 

towards these goals, and I thank the witnesses and my colleagues for joining me today to help 

strengthen U.S.-Taiwan ties. 
5

Mr. SHERMAN. Thank you, Mr. Chairman, for holding this hearing. I was impressed when I met President Tsai when she was in 

the opposition when we met in Taipei in 2015, and even more impressed when she visited the United States in 2016 and came to 

my district. Now she is the only female President in the region. 

The United States has a strong interest in supporting the people 

of Taiwan and those interests are enshrined in the Taiwan Relations Act and we need to abide by the six assurances. Our clear 

message should be that the United States does believe in the power 

of dialogue, but we unequivocally support the right of the people 

of Taiwan to determine their own government through elections. 

Taiwan should not be used as a bargaining chip. Our relationships with China are important, their dealings with North Korea 

are important, but we need to stand by the Taiwan Relations Act 

for many reasons, including that Taiwan is a democratic partner. 

Freedom House recently upgraded its appraisal of Taiwan’s democracy from 1.5 up to 1, which is their highest rating, noting not 

only the success of the 2016 elections, but also increased freedom 

in the area of press and academic freedom. Taiwan respects human 

rights, LGBT rights, et cetera. Taiwan is a partner of ours in intelligence and in cybersecurity, and it is miles ahead of China when 

it comes to protecting intellectual property. 

The Taiwan Travel Act is important. We should be upgrading, 

certainly not downgrading, our relationship with Taiwan. Taiwan 

is a country of 23 million people. At many times we have sold them 

billions of dollars in arms, but, surprisingly, in spite of that we do 

not allow Taiwanese officials to travel to the United States in any 

official capacity. Instead, we have this ruse where they can only 

come if they are refueling to go to some Latin American country 

of far less interest to the Taiwanese officials than the United 

States is, and stay in our country for a day or two during that refueling process. 

This is incredibly inconvenient to my colleagues. It is, however, 

very convenient for me since the tradition of not only this but prior 

Taiwanese Presidents is that when they land in Los Angeles they 

come immediately to a Taiwanese hotel in my district. So I am the 

only member perhaps that should oppose the Taiwan Travel Act, 

but I do indeed support it. That is why I joined with our colleague, 

Steve Chabot, introducing it and it of course expresses the sense 

of Congress that it should be U.S. policy to have governmental 

leaders of Taiwan free to visit the United States. 

The U.S. needs to be an advocate for Taiwanese participation in 

international relations whether that be Interpol, whether that be 

the World Health Assembly. China’s efforts to degrade Taiwan’s 

participation in these international organizations is not just outrageous for the 23 million people who should be represented in 

these organizations, it is bad for the entire world. The only beneficiaries are diseases and international criminals. 

Taiwan is part of the world and its involvement in these organizations are necessary for Interpol, the World Health Assembly, the 

WHO to achieve its objectives, their various objectives. As to Lee 

Ming-Che, who has been arrested in China for so-called activities 

endangering national security, she has not received visitation 

rights. His condition is questionable and this is unacceptable. 

6

We look forward to Taiwan diversifying its trade and economic 

relationships, not only deepening them with the United States but 

also other countries so it is not dependent on China. We note the 

new Southbound Policy to engage with South and Southeast Asia. 

As far as our own relationship with Taiwan, we are talking about 

$85 billion in trade. We do have a trade deficit but it is a modest 

one given the size of the relationship. That is contrasted with the 

highly lopsided, almost metastasized relationship we have with 

China, and I look forward to seeing what we can do to even, to 

make that trade deficit even smaller. With that I yield back. 

Mr. YOHO. Thank you, Mr. Sherman. And we had the distinct 

pleasure, she stopped in Miami. President Tsai stopped there to 

have dinner with us as she was going to refuel with you, so it was 

a great moment. 

Mr. SHERMAN. Is that your opposition to the act? 

Mr. YOHO. That was bipartisanship. 

Mr. SHERMAN. Bipartisan opposition. 

Mr. YOHO. We have been joined by the chairman of the full committee, Mr. Royce, for a statement. 

Mr. ROYCE. Well, thank you, Chairman Yoho. I appreciate that 

and let me just mention also that I appreciate you having this 

hearing. I appreciate the markup that preceded this on the Taiwan 

Travel Act. I am also a cosponsor of that legislation. I think by encouraging more visits between the two governments, including at 

the highest levels, we are going to further strengthen the critical 

U.S.-Taiwan partnership. I think we share certain commitments—

one of them is democracy, another is human rights, the rule of 

law—and it is really these values that serve as the bedrock of this 

partnership. 

And as these members have accompanied me, I will just mention 

also that every year I lead a large bipartisan delegation to Taiwan 

to highlight the broad and steadfast relationship that the U.S. has 

with Taiwan, and this was made possible by the Taiwan Relations 

Act of 1979. Taiwan is facing new challenges as a result of changes 

in cross-strait and global dynamics as well, and it is more important than ever to reassure Taiwan of the U.S. commitment to the 

relationship. 

Unfortunately, just this week, under pressure and with inducements from Beijing, Panama broke off decades of diplomatic relations with Taiwan and switched diplomatic recognition to the People’s Republic of China. This decision from Panamanian President 

Varela came after Taiwan has, according to media reports, provided $20 million per year in foreign aid to Panama, on average. 

I would hope that Panama, and all nations, would act to include 

Taiwan in international organizations. 

I found it particularly concerning that Taiwan was excluded from 

this year’s World Health Assembly, especially when we consider 

that wherever we go internationally after a disaster we see Taiwanese physicians, doctors, and civil society show up to assist. Taiwan has contributed to international efforts obviously to improve 

global health with financial and technical assistance, and the Ebola 

case would just be one of many, many that have occurred. It is for 

this reason that Taiwan has been invited to the World Health Assembly for the past 8 years. Taiwan’s exclusion this year only hurts 

7

global health, as our colleague Congressman Brad Sherman has 

said. There should have been no question about Taiwan’s participation. 

I am a strong advocate for strengthening Taiwan’s economic 

links to the United States and across Asia. Taiwan, as we all know, 

is the tenth largest goods trading partner, and the seventh largest 

market for our farmers and ranchers. Taiwanese companies invest 

substantially here. Taiwanese companies have pledged $34 billion 

in investments into the U.S. in 2017, and with our shared values 

of democracy and open markets it is vital that we continue to grow 

this economic partnership. Chairman Yoho understands this and 

has taken the lead on this issue by authoring legislation to encourage a deeper trade relationship between the U.S. and Taiwan, and 

I am a cosponsor and supporter of those efforts. 

Finally, one of the key provisions of the Taiwan Relations Act 

was the commitment from the United States to provide Taiwan 

with defensive arms. I remain concerned about successive administrations’ delays in our arms sales notification for Taiwan. I think 

this needlessly draws out the arms sales process. I hope to see regular notifications in the future and I look forward to the announcement of new sales this year. 

Again I thank Chairman Yoho, and I am looking forward to the 

witness’ testimony. 

Mr. YOHO. Chairman Royce, thank you for being here. It is an 

honor to have you here. At this moment we are thankful today to 

be joined by Mr. Rupert Hammond-Chambers. 

Mr. Chabot, did you have something you want to add? 

Mr. CHABOT. If the chair, because I am more than happy——

Mr. YOHO. No, go ahead, my oversight. 

Mr. CHABOT. I was just going to say I will associate myself with 

the chairman’s comments and leave it there so that we can move 

on to the witnesses. 

Mr. YOHO. Thank you, sir. We are joined today by Mr. Rupert 

Hammond-Chambers, president of the U.S.-Taiwan Business Council; Mr. Dan Blumenthal, director of the Asian Studies and a resident fellow at the American Enterprise Institute; and Mr. Russell 

Hsiao, executive director of the Global Taiwan Institute. We thank 

the panel for joining us today and share their experience and expertise and we look forward to that. You will have approximately 

5 minutes to give your opening statement. The green light will 

come on, and then don’t forget to hit the button to turn your mike 

on. Mr. Chambers, we will start with you. Thank you. 

STATEMENT OF MR. RUPERT J. HAMMOND-CHAMBERS, 

PRESIDENT, U.S.-TAIWAN BUSINESS COUNCIL 

Mr. HAMMOND-CHAMBERS. Thank you, Mr. Chairman and Mr. 

Chairman, members of the committee, it is an honor to be with you 

today. Taiwan remains a critical global partner for the United 

States. As noted, it is in fact our tenth largest trading partner 

which is extraordinary when you consider the island has very little 

in the way of natural resources and 23 million people living on a 

relatively small island. The economy surpasses $447 billion in annual GDP and its currency reserves now surpass $440 billion. 

8

By any measure, Taiwan is a poster-child example of the success 

of post-World War II U.S. foreign policy and its support for the 

building of flourishing free market democracies. Taiwan is worthy 

of significant investment by the United States, not just to support 

the island but as a representation of America’s sustained commitment to the region. Since 2005, however, the U.S.-Taiwan relationship has seen significant distress. And again, as noted successive 

administrations have downgraded the bar of support for the island 

in the face of an increasingly aggressive and hegemonic People’s 

Republic of China. The PRC campaign to undermine support for 

Taiwan continues apace, with a focus on linking China’s behavior 

on non-Taiwan matters, such as North Korea, to the willingness of 

the U.S. to curb its support for Taiwan in areas critical to Taiwan’s 

ongoing peace and security such as arms sales and expanded trade 

relations. 

As the PRC’s economic and military power grows, the United 

States is increasingly challenged to assess whether it is willing to 

maintain its ongoing interest with Taiwan or if it will abdicate that 

leadership role in the hopes of moderating China’s behavior in 

other areas of national interest. The U.S.-Taiwan Business Council 

believes that U.S. trade with Taiwan is mutually beneficial, despite 

the consistent trade deficit in goods in favor of Taiwan that has 

persisted over the last 30 years. 

Taiwan plays a tremendously important role both as a market 

for U.S.-made goods, as a manufacturing and innovation partner 

for U.S. businesses. You only need to look at your iPhone as an example of the importance and day-to-day partnership that the U.S. 

has with Taiwan. Goods and services trade with Taiwan along with 

extensive investments by Taiwan businesses in the U.S. promotes 

economic growth here and supports U.S. jobs across the country 

and in many industries. The U.S.-Taiwan Business Council also believes that Taiwan is a well-placed partner with this administration and this Congress in exploring and partnering on new bilateral 

trade initiatives including the possibility of signing a fair trade 

agreement. 

The Taiwan Relations Act clearly states that the U.S. will remain obligated to provide Taiwan with arms of a defensive character as noted already in formal comments. 

The U.S. is Taiwan’s primary military partner and retains a 

close material relationship with the island that covers not only 

arms sales, but also cooperation on cyber intelligence, training, 

maintenance, and logistics. Past U.S. policy, particularly under the 

Obama administration, focused significant efforts on the expansion 

of training and exchanges. While it goes mostly unseen, it does 

have a material impact on the island’s defense. 

In instances where U.S. commitments to Taiwan’s defense are 

discreetly carried out, there has been stability and ingenuity in expanding cooperation. However, where the commitment is overt, 

such as with arms sales under the Taiwan Relations Act, there has 

been significant regression particularly since 2011. As of June 15, 

2017, we have seen only a single sale of arms to Taiwan, in 2015, 

since as far back as September the 21, 2011. A closer inspection of 

the trend lines shows a material U.S. commitment in free fall. The 

Trump administration has been handed a challenge to assess and 

9

deliver on a new range of commitments for Taiwan’s national defense such as new fighters and diesel-electric submarines. 

U.S. strategic interests in the Asia-Pacific remain inexorably 

intertwined with our support for Taiwan’s economy and national 

security. However, this aspirational goal is being undermined by an 

orchestrated and coercive PRC policy to weaken support for Taiwan 

and to restrict Taiwan’s self-determination. 

If the U.S. continues to rhetorically say the right things but materially fails to act, then Taiwan risks being further marginalized 

globally and will be forced to interact with China from a weak position. This is inherently destabilizing. The present trajectory could 

lead to a crisis in the Taiwan Strait triggered by China’s determination that the overall trilateral balance has tipped squarely in 

its favor and that China would then act accordingly. Thank you 

very much. 

[The prepared statement of Mr. Hammond-Chambers follows:]

10


25846a-1.eps

Renewing Assurances: Strengthening U.S.-

Taiwan Ties 

Subcommittee on Asia and the Pacific 

House Foreign Affairs Committee 

June 15, 2017 

Rupert Hammond-Chambers 

President 

US-Taiwan Business Council 
11


25846a-2.eps

Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

Table of Contents 

Introdl.Iction ................................................................................................................................ 1 

Trade & Econonrlc Ties ............................................................................................................... 2 

U.S. Trade Po1icyTov·,rards Tai,van ............................................................................................................... 2 

Defense & Security Relations ...................................................................................................... 3 

Ar1ns Sales Packaging .................................................................................................................................... 4 

Conclusions & Policy Reconunendations .................................................................................... 5 

Appendix ..................................................................................................................................... 6 

Table 1: Tai,van's Trade Ranking \•vith the United States, 2004-2017 .. 

Table 2: Notified Taiwan Arms Sales Since 1990 .......................... . 

Fact Check: The Media as a Useful Tool for Chinese Propaganda 

. ... 6 

.. .. 6 

.... 9 

Excerpts from USA TODAY ............................................................................................................ 9 

Figure 1: U.S.-Taiv·.ran Trade, 1986-2<116 ..................................................................................................... 11 

Figure 2: Notified Taiwan Arms Sales, 1990-2017 ..................................................................................... 12 

.Fostering Bu::;iness Relation .. <> Between the United States and Taiwan 

ll'WW,us-taiwan.org 
12


25846a-3.eps

Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

Introduction 

Taiwan remains a critical global partner for the United States. It is currently our 10th largest trading partner, ahead of 

India and other strategica11y important countries, and it serves as a critical node in the defense and security 

architecture of the U.S. across Asia. 

Tai .. van's population of 23 . .r:; minion people is roughly the same as Australia, but the island sits on a land mass 

equivalent to 0-47% of that of Australia. In the absence of any significant natural resources, other than its people, 

Taiwan has built an economy surpassing US$474 bi11ion in annual GDP, and foreign currency reserves surpassing 

US$440 billion. Taiwan was still receiving U.S. foreign aid in the early 1950s, but has since flourished as it opened its 

markets and its political system. 

By any measure, Tai,van is a poster-child example of the success of post-World War II U.S. foreign policy and its 

support for the building of flourishing free market democracies. Taiwan is v·.rorthy of significant investment by the 

United States, not just to support the island but as a representation of America's sustained commitment to the region. 

In April1979, the U.S. Congress passed the Tai,van Relations Act (TRA), embedding U.S. policy towards Taiwan into 

law and providing the framework for future support. Meanwhile, it also set important boundaries for behavior by the 

People's Republic of China (PRC) after the U.S. S\·vitch in diplomatic recognition earlier that year. 

Since 2005, hmvever, the U.S.-Tai'"'·an relationship has been on a steady decline. Successive Republican and 

Democratic administrations have downgraded the bar of support for the island in the face of an increasingly aggressive 

and hegemonic PRC. 

The PRC campaign to undermine support for Taiwan continues apace, with a focus on linking China's behavior on nonTaiwan matters- such as North Korea- to the willingness ofthe U.S. to curb its support for Taiwan in areas critical to 

Taiwan's ongoing welfare, such as arms sales and expanded trade relations. 

As the PRC's economic and militm}' power grows, the United States is increasingly challenged to assess ·whether it is 

\villing to maintain its ongoing interest with Tai,van or if it will abdicate that leadership role in the hopes of moderating 

China's behavior in other areas of national interest . 

. Fostering Bu::;iness Relation .. <> Between the United States and Taiwan 

ll'WW,us-taiwan.org 
13


25846a-4.eps

Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

Trade & Economic Ties 

The U.S. is Taiwan's second largest h·ading parh1cr behind only China, and the h\ro have approximately US$66 billion 

in annual two-way trade. A strong and economically prosperous Taiwan is in the interests of the Unites States, and 

should be a core pillru· of American suppmt for the island. 

The US-Taiwan Business Council (USTBC) believes that U.S. trade vvith Taiwan is mutually beneficial, despite the 

consistent trade deficit in goods in favor of Taiwan that has persisted for the last 30 years. Taiv·mn plays a 

h-cmcndously impmtant role both as a market for U.S.-madc goods and as a manufacturing and innovation pmtncr for 

U.S. businesses. Goods and services trade with Taiwan- along vvith extensive investments by Taiwan businesses in the 

U.S. - generally promotes economic grovvth in the United States and supports U.S. jobs across the country and in many 

industries. USTBC also believes that Taiwan is '"'Tell placed to parh1cr ·with the Trump Administration in exploring and 

partnering on ne·w bilateral trade initiatives, including possibly signing a Fair Trade Agreement (FfA). 

Taiwan's economy has flourished, particularly since the 1980s, by positioning itself as a partner in manufacturing 

products v.rith high quality and low cost. Our bilateral economic relations arc primarily underpinned by Taiwan's 

partnership v.rith the U.S. in the development and production of infonnation technology (IT) products, v.rith the 

intellectual prope11y for these products typically held by a third party. 

For example, Apple's primary production partner for its iPhones is Foxconn, a Taiwan company with large 

manufacturing investments both in China and across the globe. Its production prowess allows for Apple to produce, on 

a large scale, millions of devices that suppm1 its operating systems and applications. The device itself typically accounts 

for less than 20% of the final consumer price, with the remaining So%+ going to the holders of the inten1al intellectual 

property. This arrangement has benefited all parties, and has created considerable wealth and productivity gains in 

both the U.S. and Taiwan. 

Hmvever, Tahvan's economy is currently at a crossroads. The tight operating margins of such contract manufacturing 

has placed considerable pressure on Tai\•.ran industry to innovate, to invest more in research and development, and for 

the government of Taiwan to improve the stcu1-up environment for entrepreneurs. Taiwan's rapid pace of development 

has now slowed as companies have matured. In addition, the emergence of new, innovative Taiwan businesses has also 

slowed dramatically. 

U.S. Trade Policy Towards Taiwan 

U.S. trade policy tuward Taiwan since 2003 has been fraught ·with tension over the protection of intellech1al property 

(2003-2005), over stn1ggles regarding beef (2007-2012), and over the cuncnt issues v.rith pork trade. In each case, 

U.S. trade negotiators have chosen to sever ongoing trade links over these periods in an attempt to pressure Taiwan 

into making changes to its economic and trade behavior. There is also a bureaucratic reluctance to move fonvard on 

h·ade initiatives with Taiwan for fear that they may disrupt similar initiatives Vlrith the PRC. 

The U.S. sh·atcgy- an ongoing insistence that for Taiwan to take the next step in trade tics, they must first undertake 

significant changes- has left U.S.-Taiwan trade ties adrift for a good portion of the past 14 years. These preconditions, 

however, change as Taiwan goes ahead and addresses them. USTBC is unaware of any other major U.S. trading partner 

being similarly treated, and regrettably U.S. exporters have been hm1 by the under-realized development of this 

impm1ant market. 

Since 2013, the U.S. has pressed Taiwan to undertake unilateral action on its pork import regime, specifically the 

admittance of pork containing the steroid ractopamine. Taiwan's domestic political constraints have prohibited such a 

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unilateral concession, and Taiwan has argued for this issue to be addressed in a broader bilateral negotiation. 

Importantly, Senator Chuck Grassley (R-IA)- a leading advocate for American farmers- recently changed his position 

from demanding that pork be addressed as a precondition for any FTA negotiations, to arguing that it should be 

addressed in a broader negotiation with Taiwan. His change in position removes an important impediment in the 

possible expansion oftrade relations betvveen the U.S. and Taiwan. However, past experience suggests that new U.S. 

preconditions to broader ties may now appear. 

USTBC remains committed to maximizing America's commercial relations '..vith Tai,van. While there are a number of 

outstanding trade issues with the island, we do not support preconditions on the path to broader ties or as an 

impediment to the launch of Fair Trade Agreement negotiations. 

Taiwan can help this process by improving communication and cooperation through an increase in the number of visits 

to VVashington, D.C. by Cabinet members and by sub-Cabinet officials. For many years, Taiwan's trade relationship was 

underpinned by constant engagement, \vith many senior economic officials in particular visiting Washington. Those 

types of visits have largely dried up, however, as both the U.S. and Taiwan became over-focused on China during the 

20o8-2o16 timeframe. In Taiwan, the demands placed on the executive branch by the Tai,van legislature have curbed 

the enthusiasm of its leadership to undertake foreign travel during ongoing sessions. This is hurting the bilateral 

relationship, and allmvs for PRC messaging to dominate U.S. govemment considerations. 

Conversely, the limits on U.S. officials traveling to Taiwan- particularly from the U.S. Department of State and U.S. 

Department of Defense -inhibit the ability of U.S. government officials and staff to make sound judgements on U.S. 

policy, and to address the constant drumbeat of China's position as it relates to Taiwan. 

Importantly, Taiwan needs to better integrate itself into the Asia Pacific region's ongoing trade liberalization 

architecture. However, it is likely that any such effort will remain unsuccessful in the absence of U .S.leadership. Asia 

Pacific countries vvillnot engage with Tah'\Tan in FTA negotiations in the face of PRC objections, unless the U.S. offers 

leadership and an established framework. It is the USTBC's view that if the U.S. does launch FTA negotiations with 

Taiwan, we can reasonably expect Japan, Australia, India and some ASEAN countries to follow-suit. 

Defense & Security Relations 

Taiwan's geographic location is of significant importance to U.S. security, particularly to the maintenance of U.S. 

interests in the first island chain that runs from Korea down through Japan and Taiwan and into South East Asia. 

The Taiwan Relations Act clearly states that the U.S. lAill remain obligated "to provide Taiwan with arms of a 

defimsive character." The U.S. is TailAran's primary military partner, and retains a close material relationship "\'\ith the 

island that covers not only anns sales, but also cooperation on intelligence, training, maintenance, and logistics. 

Past U.S. policy, particularly under the Obama Administration, focused significant efforts on the expansion of training 

and exchanges intended to improve Taiv.mn's ability to maintain a \iablc self-defense of the island. This has been an 

impm1ant and commendable development in bilateral defense tics. Vlhilc it goes mostly unseen, it docs have a material 

impact on the island's defenses. 

In instances where U.S. commitments to Taiwan's defense arc discreetly carried out, there has been stability and 

ingenuity in expanding cooperation, but where the commitment is ove11 - such as with U.S. anns sales under the TRA 

- there has been significant regression pm1icularly since 2011. 

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As of ,June 15, 2017 we have only seen a single sale of arms to Taiwan- in 2015 -since as far back as September 21, 

2011. Since 2008, ·we have only seen one new platform capability being sold to Taiwan; the upgrade of Taiwan's legacy 

F-16 fleet to the F-16V format (bar a new engine). 

VVhile successive Republican and Democratic administrations have touted high dollar values for arms sales, a c1oser 

inspection of the trend lines show a material U.S. commitment in free fa11. The Trump Administration has been handed 

a challenge to assess and deliver on a new range of commitments for Tai\·van's national defense. 

Taiwan currently has legitimate requirements for a number of systems, such as: 

- Ne\'\T advanced fighters 

- Electronic warfare aircraft 

- Ne"v diesel-electric submarines 

- Integrated command and control combat system for air defense 

- An anti-ba11istic missile defense system 

- A remote sensing satellite system (SAR/EO) 

- Medium-altitude, long-endurance unmanned aircraft system to gather intelligence as well as deploy air-tosurface missiles 

- Modem towed and self-propelled miille1y 

- A Main Battle Tank 

Additionally, the Tnnnp Administration should also consider and implement: 

- Mobile Training Teams on six month rotations at brigade level and above tOr English and advisory missions 

- Formal agreement on a shared common operational platform (COP) 

- Annual 2+2 meetings (senior DoD & State meeting with their Tai'"'·an counterparts) 

- A Joint \1\'ork Plan for future bilateral defense relations 

- Expanded Taiwan military training in the U.S., to include the Taiv·,ran Army and Navy 

As Taiwan seeks to grow its domestic defense industry, it is also in a strong position to add value to America's 

industrial partnerships and to expand American defense exports. Therefore, the USTBC recommends that the Trump 

Administration invite Taiwan to participate at the Tier 2 level of several ongoing service programs. Taiwan tun1ed 

down the opportunity to participate as a Tier 2 partner for the F-35 program, and lost an opportunity to secure access 

to the fighter at an early stage ·while simultaneously integrating Taiwan industry into the fighter's supply chain. Mo\ing 

ahead on such participation in the future could be an important strategic action binding the two sides closer together. 

Taiwan's defense spending is presently under 2% of its GOP. This remains unacceptable, and results in undcrfunding 

for Tai .. van's military modernization goals and the goal of moving toward an all-volunteer force. As then Deputy 

Assistant Secretary of Defense Richard Lawless noted in 2005 at a USTBC conference, "We cannot help defend you, if 

ym1 cannot defend yoHrse{f" These words still stand true today as Taiwan continues to underinvest in its own selfdefense. 

Arms Sales Packaging 

In2oo8, after an extended freeze in the notification process, the Bush Administration adopted a policy of packaging 

congressional notifications for arms sales into bundles that \vere notified together. That packaging process was adopted 

in an attempt to fulfil U.S. defense commitments to Taiwan in a way that would he less objectionable to China . 

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Regrettably, this practice has been maintained since then, to increasingly damaging effect. The bundling of 

Congressional notifications has placed downward pressure on the V~.ri.llingness of the U.S. to sell arms to Taiwan, while 

simultaneously complicating Tai·wan's ongoing force modernization and budgetary process. 

The USTBC recommends that the Trump Administration end the policy of packaging, and return to a regularized 

process whereby Taiwan would be treated like other security assistance partners all the way from the U.S. accepting 

Letters of Request (LoRs) for Pricing & Availability (P&A) data through to consulting vvith and notifying Congress of an 

intention to sell arms to Taiwan. 

China will object to any sale of arms by the United States to Taiwan, irrespective of size, capability, or value. The U.S. 

leadership is charged with assessing Tai,van's requests for material support based only on the merits of the platfOrm 

and on the extent to \vhich the sale will support our nation's broader Aqia Pacific goals. U.S.-China policy- beyond the 

grmving threat posed by Chinese forces amassed across from Taiwan- should not be a consideration in this area. 

The TRA states that "the United States decision to establish diplomatic relations with the People's Republic of China 

rests upon the expectation that the future of Taiwan will be determined by peaceful means" and that "any effort to 

determine the future of Taiwan by other than peaceful means, including by boycotts or embargoes, a threat to the 

peace and security of the Western Pacific area and of grave concern to the United State..<;;." China's ongoing force 

modernization directed at invading Taiwan, along with its coercive military posture, therefore undermine the very 

premise of the 1979 S\\ritch in recognition. 

Conclusions & Policy Recommendations 

U.S. strategic interests in the Asia Pacific remain inexorably intertwined \\rith our support of Taiwan's economy and 

national security. However, this aspirational goal is being undermined by an orchestrated and coercive PRC policy to 

weaken U.S. suppm1 for the island, and to restrict Tai\1\'an's sclf-detennination. 

If the United States continues to rhetorically say the right things but materially fails to act, then Taiwan risks being 

marginalized globally, and will be forced to interact with China from a weak position. The present trajectory could lead 

to a crisis in the Taiwan Strait- triggered by China's determination that the overall trilateral balance has tipped 

squarely in its favor and acting accordingly. 

The US-Taiwan Business Council has a number of policy recommendations for the Trump Administration and the 

nsth U.S. Congress to consider. The USTBC recommends: 

- That the U.S. launches negotiations with Taiwan for a Fair Trade Agreement (FTA) without preconditions 

- That the Trump Administration unde11akes an assessment of and commitment to the range of nC\\' defense 

capabilities presently being requested by Taiv·.:an 

- That the arms programs presently awaiting Congressional notification at the U.S. Department of Stateincluding the 2007 notification for Taiwan's submarine program -be sent to Congress immediately 

- That the Trump Administration ends the packaging of Congressional notifications for the sale of arms to 

Tai\\'lli1, returning to a regulm·, ongoing process 

- That Tai\.van should be encouraged to send significantly more Cabinet and sub-Cabinet level officials to the 

U.S. on a regulru· basis, to expand tics and to improve communication and cooperation 

- That the Trump Administration undertakes sustained engagement by Cabinet officers in visiting Taiwan 

- That U.S. policy is adjusted to allow for Assistant Secretaries from State and Defense to \isit Taiwan . 

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Appendix 

Table 1: Taiwan"s Trade Ranking with the United States, 2004-2017 

Year Rank Percentage of overall U.S. trade 

2004 8 2.p;o% 

2005 8 2.20% 

2006 2.10% 

2007 2.10% 

2008 12 1.80% 

2009 10 1.80% 

2010 1.90% 

2011 10 1.80% 

2012 11 1.70% 

2013 12 1.70% 

2014 10 1.70% 

2015 1.80% 

2016 10 1.80% 

2017YTD 10 1.80% 

Source: U.S. Census Bureau, Top Trading Partners 

Table 2: Notified Taiwan Arms Sales Since 1990 

Date 

Jul1990 

Scp 1990 

Jan 1991 

Jul1991 

Sep 1991 

Nov1991 

May1992 

May1992 

Aug1992 

Scp 1992 

Scp 1992 

Scp 1992 

Jun1993 

Jun 1993 

Jul1993 

Jul1993 

Aug1993 

Sep 1993 

Nov1993 

Notification 

Cooperative Logistics Supply Suppmt 

One C-130H transpmt aircraft 

100 MK-46 torpedoes 

97 SM-1 Standard air defense missiles 

110 M6oA:3 tanks 

Phase III PIP Mod Kits for HA \VI< air defense systems 

\¥eapons, ammunition, support for 3leased ships 

Supply support arrangement 

207 SM -1 Standard air dc±Cnsc missiles 

150 F-16A-B fighters 

3 Patliot-delived Modified Air Defense System (MADS) fire units 

12 SH-2F LAMPS anti-submarine helicopters 

12 C-130H transport aircraft 

Supply support arrangement 

38 Harpoon anti-ship missiles 

Logistics support services for 40 leased T -38 trainers 

4 E-2T Hawkeye airborne early warning aircraft 

Logistics supp011 services for .l\iADS 

150 MK-46 Mod 5 torpedoes 

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Est. Cost 

0.108 

0.045 

0.028 

0.055 

0.119 

0.17 

0.212 

0.107 

0.126 

5.8 

1.3 

0.161 

0.62 

0.156 

o.o68 

0.07 

0.7 

0.175 

0.054 
18


25846a-9.eps

Nov 1993 

Nov 1993 

Aug1994 

Sep 1994 

Mar 1995 

Jun 1995 

May1996 

May1996 

May1996 

Jun 1996 

Aug1996 

Scp 1996 

Feb 1997 

Map997 

Jul1997 

Sep 1997 

Nov1997 

Nov1997 

Jan 1998 

Jun 1998 

Aug1998 

Aug1998 

Aug1998 

Oct 1998 

Map999 

Map999 

Jul1999 

Jul1999 

Mar2ooo 

Mar 2000 

Jon 2000 

Jun2ooo 

Sep 2000 

Sep 2000 

Sep 2000 

Sep 2000 

Jul2001 

Sep 2001 

Oct 2001 

Oct 2001 

Jun 2002 

Sep 2002 

Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

Weapons, ammunition, and support for 3 leased frigates 

l\.lK-41 Mod Vertical Launch Systems for ship-based air defense missiles 

So AN-ALQ-184 electronic counter measure ECM pods 

MK-45 Mod 2 gun system 

6 MK-75 shipboard gun systems, 6 Phalanx Close-In Weapon Systems 

Supply support arrangement 

Improved J'dobile Subscriber Equipment communications system 

30TH 67 training helicopters, 30 sets of AN AVS 6 night vision goggles 

465 Stinger missiles, 55 dual-mounted Stinger launcher systems 

300 M6oA:JTIS tanks 

1,299 Stinger surface-to-air missiles, 74 Avenger vehic1e mounted guided missile 

launchers, 96 HMMVVVs (High-Mobility Multi-Purpose V\Theeled Vehicle) 

110 l\IK-46 :MOD 5 anti-submarine torpedoes 

54 Harpoon anti -ship missiles 

1,786 TO\V 2A anti-armor guided missiles, 114 TOW launchers, 100 HMMWVs 

21 AH -1\V Super Cobra helicopters 

13 OH-s8D Kiowa Warrior Armed Scout helicopters 

Pilot training and logistics support for F-16 fighters 

Spare parts for various aircraft 

3 Knox-class frigates, 1 MK 15 Phalanx Close-In \Veapons System 

28 Pathfinder-Sharpshooter navigation and targeting pods for F-16 fighters 

58 Harpoon anti-ship missiles 

61 Dual-mount Stinger surface-to-air missiles 

131 MK 46 Mod sAS anti-submarine torpedoes 

9 CH-47SD Chinook helicopters 

240 AGM -114KS Hellfire II air-to-smface missiles 

5 AN-VRC-92E SINCGARS radio systems, 5 Intelligence Electronic Warlare systems, 5 

HMMWVs 

Spare parts for F-sE-F, C-130H, F-16A-B, and IDF aircraft 

2 E-2T Hawkeye 2000E airborne early warning aircraft 

1\.lodernization of the TPS-4:)F air defense radar to TPS-75V configuration 

162 HAVVK Intercept guided air defense missiles 

39 Pathfinder-Sharpshooter navigation and targeting pods for F-16 fighters 

48 AN-ALQ-184 ECM pods for F-16s 

146 M109A5 ho"\-\itzers, 152 SINCGARS radio systems 

200 AIM -120C Al\1RAAMs for F -16 fighters 

71 RGM-84L Harpoon anti-ship missiles 

Improved Mobile Subscriber Equipment IMSE communication system 

JTIDS Consoles and Related Equipment and Support 

AGM -6sG Maverick Missiles and Related Equipment and Support 

.Javelin Anti-Tank Missiles and Related Equipment and Support 

Cooperative Logistics Supply Suppmt Arrangement 

Air Traffic Control Radar 

Rebuilt Standard Assault Amphibious Personnel Vehicles 

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0.103 

0.1.') 

0.021 

0.075 

0.192 

0.188 

0.053 

0.22;~ 

0.066 

0.095 

0.081 

0-479 

0.172 

0.28 

0.14 

0.101 

0.069 

0.023 

0.15 

0.096 

0.106 

0.234 

0.122 

0.018 

0.051 

0.288 

0.108 

7 
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Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

"' ,,,H "' <, ""''" 

Sep 2oo2 1\.laintenance of Repairable Material 0.174 

Sep 2oo2 AIM-gM-1j2l\.lissiles o.o;~6 

Sep 2oo2 AGM-114M:~ HELLFIRE II Air-to-Sut-face Anti-Annor Missiles o.o6 

Oct 2002 TOV/-2ll missiles 0.018 

Nov2002 KIDD Class Guided Missile Destroyers 0,875 

Sep 2003 Multifunctional Infonnation Distribution Systems/Low Volume Terminals 0,775 

Mar 2004 Ultra High Frequency long range early warning radars L776 

Oct 2oos Missiles and Pilot Training Program 0.28 

Feb 2007 AJ\IRAAJ\I and Maverick missiles 0-421 

Aug2007 AGM 84L HARPOON Block II missiles 0.125 

Sep 2007 SM-2 Block IliA STANDARD missiles 0.272 

Sep 2007 Excess P-3C aircraft L96 

Nov2007 PATRIOT Configuration 2 Ground Systems Upgrade 0,9:J9 

Oct 2008 30 AH -64D Block III APACHE Longbow Attack Helicopters 2,532 

Oct 2008 32 UGM-84L Sub-Launched HARPOON Block II missiles and 2 UTM-84L HARPOON 0,2 

Block II Exercise missiles 

Oct 2008 Upgrade of four E-2T Aircraft to the HA \A/KEYE 2000 configuration 0.25 

Oct 2008 330 PATRIOT Advanced Capability (P AC-3) missiles 3,1 

Oct 2008 Spare parts in support of F-5E/F, C-130H, F-16A/B, and Indigenous Defense Fighter IDF 0,334 

aircraft, communication equipment, radar, and other related elements of logistics support 

Oct 2008 182 JAVELIN guided missile rounds and 20 JAVELIN command launch units 0,047 

Jan 2010 UH-6ol\.1 BLACK HAWK helicopters 3,1 

Jan 2010 Multifunctional IntOnnation Distribution SystcmsjL0\'1' Volume Terminals (MIDS/LVT-1) 0,34 

Jan 2010 OSPREY Class Mine Hunting Ships 0.105 

Jan 2010 ATM-84L and RTM-84L HARPOON Block II Tclcmctl}' missiles 0,037 

Jan2010 PATRIOT Advanced Capability (PAC-3)Firing Units, Training Unit, and Missiles 2B1 

Scp 2011 F-16 pilot training program 0,5 

Scp 2011 Retrofitting ofF -16A/B aircraft 5,3 

Sep 2011 Spare parts in support of F-16Ajll, F-5EjF, C-130H, and Indigenous Defense Fighter 0.052 

(IDF) aircraft 

Dec 2015 208 ,Jave1in Missi1es 0.057 

Dec 2015 B1ock I-92F MANPAD Stinger Missi1es and Re1ated Equipment and Support 0.217 

Dec 2015 2 01iver Ha,..;ard Perry C1ass Frigates 0.19 

Dec 2015 MIDS/LVT-1 and ,JTIDS Follow-on Support 0.12 

Dec 2015 Taiwan Advanced Tactical Data Link System (TATDLS) and Link-11 Integration o.o75 

Dec 2015 36 Assault Amphibious V chicles (AA V s) 0,375 

Dec 2015 TOVl 2B Aero RF Missiles, support and training 0,268 

Dec 2015 1\.IK 15 Phalanx Block lB Baseline 2 Close-in VVeapons System (CIVVS) Guns, Upgrade OA16 

Kits, Ammunition, and Support 

Estimated Cost in US$ Billion 

Sources: Defense Security Cooperation Agency (\'I'W'iv.dsca.mil) 

Kan, Shirley A. "Taiwan: Major U.S. Arms Sales Since 1990" CRS Repmt RL30957, June 13, 2014 

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Fact Check: The Media as a Useful Tool for Chinese Propaganda 

- Chronic poor reporting on Taiwan by U.S. and international media is undermining the island. Western media 

unthinkingly parroting Chinese propaganda is an effective component of China's infonnation warlare strategy. 

- The referenced Panama statement actually echoes China's "One-China Princirle." This is different and distinct 

from the U.S. "One-China Po lieu." The U.S. has never stated thatTaivvan is a ''breakaway province"- this is the 

Chinese position. Conflating the tv.ro is in China's interests, as part of its ongoing attempts to re-define all 

"One-China" interpretations to match its OlATI version. 

- The article presents only China's position on the Panama development, v-.ith no attempt to get the Taiwan 

government side of the story. 

- The last arms sales package to Taiv .. 'd.n was in 2015, not 2016, and it ended a drought of over 4 years since the 

previous sale. 

What is the 'One China' policy? 

June 13, 2017 

Excernts from USA TODAY 

h ttps: I b'\'ffi.Y:!!.t;;.atod;:ty.t.Qill I story lne\vS 1 2.01"1 I o6 f n I vvh at-is-nne-cl1J.rul:uohcv i w2Bo6~e&il. 

Panama cut ties with Tai\van on Tuesday, S\vitching its diplomatic relations to the People's Republic of China and 

accepting the "One China" policy. ''The Government of the Republic of Panama recognizes that there is only one 

China in the \vorld," the joint statement said. "The government of the People's Republic of China is the only legitimate 

government representing all China, and Taiwan is an inalienable part of the Chinese territory." 

\A1ith Panama's departure from Taiwan's diplomatic cadre, that leaves just 20 or so nations with official, ambassadorlevel diplomatic ties to the island. Most nations, including the United States, have accepted the "One China" 

policy. 

OK so what is the One China policy? 

The U.S. recognition of a "One China" policy stems from 1979, when the U.S. switched diplomatic recognition from 

Tai .. van to the People's Republic of China (PRC). In the 1979 U.S.-PRC Joint Communique, the United States 

recognized the communist leadership in Beijing as the sole legal govermnent of China, acknowledging 

the Chinese position that there is one China and Taiwan is a breakaway province that is part of China. 

"The Taiwan question bears on China's sovereignty and territorial integrity and touches our core interests," Chinese 

foreign ministry spokesman Geng Shuang said in January after President Trump questioned the "one 

China" policy. "Adherence to the one China principle serves as the political foundation for the 

development of China-U.S. ties. If this foundation is wobbled and weakened, then there is no possibility for the 

tvvo countries to grow their relations in a sound and steady way and cooperate on key areas." 

It hasn't always been easy ... 

Earlier this year, China and the U.S. had a falling out when Tn.unp questioned the "One China" policy. Tmmp 

broke ·with years of diplomatic protocol following his election when he accepted a congratulatory phone call from 

Taiwan President Tsai II1g-wen and again riled the Chinese when, in an intenie\'\T with The Wall Street Journal in 

January, he said: "Everything is under negotiation, including One China." From the Chinese perspective, that 

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Renewing Assurances: Strengthening U.S.-Taiwan Ties 

June 15,2017 

policy is non-negotiable. 

The U.S. seems to do a lot of business \vith Tai,van. What's un with that? 

Officially, the U.S. government does not support independence for Taiwan, a democracy that elects its own president 

and parliament. U.S. relations with the island are governed by the 1979 Taiwan Relations Act, which outlines the U.S. 

commitment to help Taiwan maintain its military defense. Last year, the U.S. approved $1.8 billion in arms 

sales to Taipei. 

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25846a-13.eps

9l0<: 

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25846a-14.eps

Figure 2: Notified Taiwan Arms Sales, 1990-2017 (US$ Billion) 8 ,-----

6 +--------1 

4 +-----1 

3 +--------1 

0.15 0-0 ... "' M ... "' "' " 00 a- 0 a- 8 "' a- a- a- a- a- a- a- a- a- 0 0 a- a- a- a- 0 0 0 

... ... ... ... "' "' "' 

Sources: Defense Security Cooperation Agency (www.dsca.mil) 

Kan, Shirley A. "Taiwan: l\1qjor U.S. Arms Sales Since CRS Report RI.o0957, June 13, 2014 

* The 2015 data docs not incl ude the additional OCS case. 

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24

Mr. YOHO. Thank you, Mr. Chambers. 

Mr. Blumenthal? 

STATEMENT OF MR. DAN BLUMENTHAL, DIRECTOR OF ASIAN 

STUDIES AND RESIDENT FELLOW, AMERICAN ENTERPRISE 

INSTITUTE 

Mr. BLUMENTHAL. Thank you very much, Mr. Chairman and Mr. 

Ranking Member. Thank you for inviting me to testify on this very 

important issue. I termed my testimony, Taiwan as Partner and 

not Taiwan as Problem because I think what is missing in our policy toward Taiwan is reality and the truth. The reality is it is in 

the 21st century versus 1971 and 1972. 

The reality is that Taiwan is a thriving democracy, wishing nothing more than to develop peacefully into more of an innovative 

technological powerhouse. It makes no claim on Chinese territory, 

it has abandoned the Chinese civil war long ago, and it poses absolutely no threat to the Chinese people. To the contrary, it has 

played a great role in China’s economic boom. 

And let’s be very clear about what the PRC is doing. It is making 

an imperial claim on Taiwan. When we acquiesced in China’s One 

China Policy—they call it Principle—we basically said that we are 

acquiescing in helping China reattain all of its lost imperial territories. They sit on Xinjiang. They sit on Tibet. They are having 

more encroachments on Hong Kong. The last remaining imperial 

territory left is Taiwan. Now there may have been good reason to 

do so back then, but let’s be very clear this is an imperial claim. 

The Chinese may say otherwise. They may say there are issues regarding the civil war, but we are, in essence, acquiescing to Chinese imperialism. 

This is surely an oddity in today’s international relations. In the 

21st century we certainly don’t see the United States or other countries acquiescing on imperial ambitions. Obviously to the Congress’ 

great credit, one of the finest things it did was pass the Taiwan Relations Act at the time and adhere to it and make sure the executive branch adhered to it so that Taiwan wouldn’t become completely swallowed up. 

A little history if you will indulge me. Back then China badly 

needed an opening with us. They had the Soviet Union on their 

border. They wanted to attack Vietnam. I am not so sure what we 

got out of that deal. That is for the historians. But I will ask this 

question. Are we still getting bad deals with China? Has anything 

really changed? When things float up in the foreign policy sphere 

about fourth communiques and so forth, we have to ask ourselves 

have the three communiques served our interests? Why in the 

world would we want a fourth? 

We have to actually ask ourselves another question. Is there any 

other bilateral relationship governed by joint statements, communiques, and diplomatic snapshots of the moment rather than by 

treaty or anything else? What force do communiques have in diplomacy? They are a snapshot of the geopolitical moment. That is history. We are stuck with what we have today. We probably could 

have and should have gotten dual recognition of Taiwan and China 

in the 1970s like we did with Germany. Maybe we won’t get it 

25

today, but there are still many options that we have to keep increasing Taiwan’s autonomy and well-being. 

Quickly, defense. We have all mentioned it. Taiwan could absolutely do more on its defense budget. But I was a Bush appointee 

during the $30 billion arms package to Taiwan. Taiwan has bought 

every single item on that package that we offered to them, besides 

the submarines, and that is because we have been playing games 

with the submarines. They will buy. Their defense budget will skyrocket if we make things on offer. 

But we should go further than just cross-Strait relations. Taiwan 

should be an integral part of our first island chain defense strategy. It is a harder target than the Philippines. If we sell the right 

things and engage in the right security cooperation with Taiwan it 

will make it harder for China to break out into the Pacific Ocean 

with impunity. 

Let me skip trade, although it is very important. Let me just say 

this in closing. It is the height of fantasy to think that we can go 

forward with any building of Asian order without Taiwan. Taiwan 

is a claimant in the South China Sea. Taiwan is a more advanced 

economy than a lot of the TPP countries that entered. In fact, from 

an economic viewpoint it would be easy to do an FTA with Taiwan. 

The only thing holding us back is our reluctance with China. 

We can’t just sit here and ignore the fact that Taiwan sits in the 

middle, geostrategically, between Northeast and Southeast Asia. 

We can’t have a South China Sea policy without Taiwan. And conversely, if Taiwan does fall into the hands of China, it will badly 

impinge upon our security interest with respect to the Japan alliance in the Pacific Ocean. So, Taiwan is, in reality, a partner, a 

key partner, and there is a lot more we can do to integrate it into 

the Asian order because the reality is it is already part of it. Thank 

you. 

[The prepared statement of Mr. Blumenthal follows:]

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AMERIC/'I.f'~ 

ENTERPRISE 

INSTITUTE 

Taiwan as Partner, not Problem 
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Mr. Chairman (Rep. Ted Y oho) Ranking member (Rep. Brad Shennan) 

Thank you for inviting me to testify before you today alongside my two distinguished 

colleagues. Though China's aggressive activities in the South China Sea, rivalry with Japan, and 

the persistent crisis on the Korean Peninsula loom as large and dangerous matters, relations 

across the Strait are still arguably the biggest issue of contention between the US and the 

People's Republic of China (PRC). 

Allow me to boil the problem down to its essence: Taiwan is a thriving democracy, wishing 

nothing more than to continue to peacefully develop into an innovative technology powerhouse. 

It makes no claims on Chinese territory and poses no threat to the Chinese people. To the 

contrary, Taiwan has played a major role in the China economic boom. However, the PRC 

makes an imperial claim to the island based on the fact that its last great empire conquered 

Taiwan hundreds of years ago. lt gives Taiwan no quarter, as we just witnessed with Beijing's 

pressure on Panama to de-recognize Taiwan. 

To be sure, there are other reasons why the People's Republic of China claims Taiwan- the 

legacy of the Chinese civil war and geostrategic considerations associated with China's 

attempted naval break-out into what we call the "first island chain." 

But the bottom line is this: when we acknowledged in our first joint Communique with the PRC 

in 1972 ''that all Chinese on either side of the Taiwan Strait maintain there is but one China and 

that Taiwan is part of China," we acquiesced in the Chinese project of putting back together its 

lost empire. With Xinjiang and Tibet firmly under the Chinese Communist Party's control, and 

Hong Kong losing its political autonomy, China is on its way to "re-unifying" its empire. 

This is an oddity in contemporary international relations. Surely other countries are trying toreestablish their imperial borders- but China has already gained begrudging acceptance from 

much of the free world in its imperial ambitions, and Taiwan alone stands in the way. 

To Congress' great credit, Taiwan was not swallowed up. Passage of the Taiwan Relations Act 

saved an ally from being destroyed. 

China gained much back then- the breaking of our diplomatic ties and treaty with Taiwan, relief 

from Soviet pressure on their borders, and the freedom of action to attack Vietnam in 1979. 

What we gained is still open to academic debate. But here is a timely question: has this pattern 

of China getting the better end of deals with us really changed? 

When new ideas, such as negotiating a 4th communique, are floated in high government circles, 

the first question should be: did the first three really benefit us? Are we better off without 
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diplomatic recognition of Taiwan -without an arrangement where we recognize both Taiwan and 

China like we did with the two Gerrnanys 0 Deterrence is best served with clarity, and China 

may yet take advantage of our uneven commitment to Taiwan. 

The Communiques attempted to serve the geopolitical momentum, but that period is long-gone. 

Today, China is our most vexing strategic rivaL 

With this in mind, the geopolitical question of the moment should be: how can Taiwan advantage 

us in our rivalry with China? This is a much different way of framing our Taiwan relationship. 

Our default position is to think about how to manage the Taiwan "problem" so that it doesn't get 

in the way of our China relations. 

I would humbly urge Congress to frame its legislative agenda in those terms -what more could 

we do with Taiwan that would help it thrive in ways that advantage our strategic competition 

with China0 

We lost our chance at dual recognition because of a rushed and messy process of normalizing 

relations with China. However, we still have some options to help maintain Taiwan's autonomy 

and serve our interests: 

I) Defense- While it is true that Taiwan does not always demonstrate an adequate urgency 

about the threats it faces, we don't always provide them with the opportunity to do so. 

The Taiwan defense budget would skyrocket if we put on offer the submarines, or the 

manned or unmanned aircrafts that Taiwan asks for. 

a. But we should go further. We need only consult a map to see that Taiwan can 

play an integral part in a strategy of defending the "first island chain," which 

would make it harder for China to break out into the Pacific Ocean with impunity. 

2) Trade- The agenda of trade liberalization has seriously lost momentum. Finalizing 

trade agreements with advanced countries like Taiwan would rebuild new momentum. 

Taiwan would go far in opening its markets and ridding itself oftari!Js. As the Trump 

Administration goes forward with bilateral FTAs, Taiwan could quickly become part of a 

free trade area of East Asia. 

a. Either we will set the rules and standards on tariffs, SOEs, IP, standards, and 

investment, or China will. Taiwan is a great place to begin (as is Japan). 

3) Integration into a still nascent Asian regional order- It is the height of fantasy to 

think that a durable order favorable to our values and interests can form without Taiwan 
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It is a claimant in the South China Sea dispute as well as a key player in global high-tech 

supply chains. And it is living proof, during a time of democratic black-sliding, that 

liberal democracy can take root in any society. 

To conclude, with some ingenuity and creativity in Taipei and DC, Taiwan could be a partner in 

a robust US defense posture in the Asia-Pacific, in the creation of a "gold standard" free trade 

area in Asia, and in shaping a favorable regional order. 

Thank you very much. 
30

Mr. YOHO. Thank you, Mr. Blumenthal, for those informative 

statements, and I look forward to getting into the questions. 

Mr. Hsiao? 

STATEMENT OF MR. RUSSELL HSIAO, EXECUTIVE DIRECTOR, 

GLOBAL TAIWAN INSTITUTE 

Mr. HSIAO. Thank you, Chairman Yoho and Ranking Member 

Sherman, for inviting me to testify before this subcommittee. This 

is truly an honor for me to be a part of this important and timely 

proceeding with my copanelists whom I deeply respect. 

It has been over a year now since the subcommittee last held a 

hearing on Taiwan. A lot has happened since then. I would like to 

point out three clusters of developments for the subcommittee’s 

considerations. First, President Tsai Ing-wen’s historical election in 

January 2016 as the government’s first female President sets a 

positive standard for other democracies worldwide. 

In addition to electing a female head of government, Taiwan’s 

Supreme Court recently issued a landmark ruling that invalidates 

a civil code provision prohibiting same-sex union. This act further 

raises Taiwan’s profile in the league of progressive and liberal nations. According to the independent watchdog organization Freedom House, which monitors freedom and democracy worldwide, 

Taiwan ranked third most free in the Asia-Pacific, only behind 

Australia and Japan. While no democracy is perfect, democratization has had a moderating effect on Taiwan’s fractious politics, 

which is clearly illustrated in the measured policies of the ruling 

government, and through the opposition Nationalist Party’s chairperson election last month. 

On cross-Strait, political relations between Taipei and Beijing 

has cooled as the PRC refuses to deal with the Tsai administration 

unless she accepts the so-called 1992 Consensus. While formal 

channels of communications between the PRC’s Taiwan Affairs Office and to Taiwan’s Mainland Affairs Council remains shut after 

Beijing froze dialogue back in June 2016, functional channels for 

coordination between different government agencies remain open. 

As a Chinese-speaking democracy, Taiwan has a unique role to 

play in China’s future, but that role must not come at the expense 

of the freedom and democracy that the people of Taiwan have 

fought for and now enjoy. 

The chilling case of the detained human rights activists, Lee 

Ming-che, who has been in detention since March 19th, throws into 

sharp relief the impact that China’s non-democratic system has for 

Taiwan and its people, and also for Hong Kong. As the 2014 student-led protests in Taiwan and Hong Kong illustrate, what happens in Taiwan has a demonstration effect on Hong Kong, and 

what happens in Taiwan has a demonstration effect on Taiwan. 

Despite Taipei’s measured approach to cross-Strait relations, Beijing fired the first salvo that ignited cross-Strait tensions only 1 

month after Tsai Ing-wen was elected President. 

In February 2016, the PRC resumed diplomatic ties with Gambia. December 2016, Sao Tome and Principe switched diplomatic 

recognition. In January 2017, Nigeria announced that it was demoting ties with Taiwan by forcing Taipei to move its representative office from Abuja to Lagos. Panama’s announcement just TuesVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
31

day that it had switched diplomatic recognition to PRC is the latest 

in a series of escalatory steps in Beijing’s enhanced pressure tactics 

against Taiwan that include economic, military, and diplomatic coercion. It was only a matter of time before Beijing pulled the trigger. 

Taiwan’s informal ties with countries like the United States, 

India, Japan, Australia, and Singapore are now more important 

than ever as Beijing squeezes Taiwan’s international and diplomatic space further. Specifically, more efforts need to be made to 

upgrade Taiwan’s ability to engage the international community by 

including Taiwan in not only bilateral, but also multilateral exchanges to offset Beijing’s coercive full-court press on Taiwan’s 

international space. 

As a strategic effort to rebalance its foreign relations and economy, the Tsai government has reinvigorated a longstanding policy 

to diversify its economic outreach which is currently heavily concentrated on China to the growing markets in the Indo-Pacific. 

Through an all-of-government approach, Taiwan is attempting to 

forge closer economic links as well as deepen the people-to-people 

ties with 18 countries in Southeast Asia, South Asia, and Australasia. The new plan is also the natural outgrowth of demographic 

trends on the island as more immigrants come to the country and 

with more children born of mixed marriages. 

And just as the United States looked toward Asia in the former 

administration’s pivot to rebalance strategy, Taiwan is also looking 

south to capitalize on the growing markets as well as strategic importance of the region. 

Against the backdrop of a growing military imbalance in the 

Strait, Taiwan has currently embarked on ambitious measures to 

strengthen its indigenous defense capabilities and industries. Taipei just released a new military strategy through its QDR. 

As a percentage of total government spending, Taiwan currently 

spends up to 15 percent on defense and, in March, Taiwan’s minister of National Defense targeted for military expenditures to rise 

to the proverbial 3 percent of GDP. In this context, it is worth at 

least asking ourselves why in the absence of a mutual defense treaty does the U.S. demand that Taiwan spend an arbitrary 3 percent 

of its GDP on defense while expecting less of our other allies and 

partners. 

Second, we now have a new President of the United States, an 

unorthodox President, who has not only shown that he will be not 

held back by unnecessary diplomatic norms, he has also demonstrated a willingness to question policy dogmas. As Presidentelect, Trump made an important gesture by taking a congratulatory phone call with the President of Taiwan. For a conversation 

that lasted no more than 10 minutes and mainly involved an exchange of niceties, the blowback was disproportional and underscores the fragility of the U.S.-Taiwan relationship. 

The administration has identified North Korea’s nuclear program 

as a primary threat in East Asia. In its efforts to apply maximum 

pressure on Pyongyang to denuclearize, President Trump is clearly 

attempting to re-enlist the support of the Beijing to use its leverage 

over North Korea to stop its provocations. Interestingly, experts 

have noted that while Beijing’s leverage over Pyongyang is signifiVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
32

cant relative to the United States’ and Japan’s because the two 

have little to none, Beijing’s actual leverage over Pyongyang is perhaps very little. The fact that North Korea has launched 16 missiles in ten tests so far in 2017 may be evidence of that lack of leverage. Therefore, any anticipation of what a tradeoff may bring in 

terms of actual results must be measured by a dose or realistic expectation in what China can and is willing to do. 

While there is no evidence to indicate that the administration is 

considering such a move, I would simply note this as caution for 

the administration to avoid entertaining such a seductive idea that 

has no legs. With that I will yield. Thank you. 

[The prepared statement of Mr. Hsiao follows:]

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Global Taiwan Institute 

"Renewing Assurances: Strengthening U.S.-Taiwan Ties" 

Testimony before 

Subcommittee on Asia and the Pacific 

House Committee on Foreign Affairs 

United States Honse of Representatives 

June 15, 2017 

Russell Hsiao 

Executive Director 

Global Taiwan Institute 

My name is Russell Hsiao. I am the Executive Director of the Global Taiwan Institute, a 

501(c)(3) think tank dedicated exclusively to Taiwan policy research and public education. The 

views I express in this testimony are my own. 

Thank you, Ranking Member Sherman and Chairman Yoho, for inviting me to testify before the 

subcommittee. This is truly an honor for me to be a part of this important and timely proceeding 

with my co-panelists whom I deeply respect. 

It has been over a year now since this subcommittee last held a heating on Taiwan and a lot has 

happened since then. Per your guidance, I would like to point out three clusters of developments 

for this subcommittee's considerations and provide explanations that illustrate their significance 

for the future of US-Taiwan relations. I hope these observations will help better inform the 

subcommittee as it deliberates how the United States might improve how we conduct relations 

with Taiwan under this new environment. 

Taiwan 

First, across the Pacitic in Taiwan, President Tsai lng-wen's historic election in the January 2016 

election as the government's first female president sets a positive standard for other democracies 

worldwide. President Tsai has been in ofiice now for over one year as her administration 

celebrated its one-year anniversary on May 20. I had the pleasure of being in Taiwan at that time 

and observed first-hand the people there after an eventful year of both ups and downs in USTaiwan relations. 

In addition to electing a female head of government, Taiwan's Supreme Court recently issued a 

landmark ruling that invalidates a civil code provision prohibiting same-sex union, which further 
34


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raises Taiwan's profile in the league of progressive and liberal nations. According to the 

independent watchdog organization Freedom House, which monitors freedom and democracy 

worldwide, Taiwan ranked third most free in the Asia-Paci±ic, only behind Australia and Japan in 

its Freedom in the World 2017 report, and 40th among 211 entities studied in the report. While 

no democracy is perfect, democratization has had a moderating etiect on Taiwan's fractious 

politics and clearly illustrated in the measured policies of the current ruling government and the 

Nationalist Party chairperson election last month. 

Cross-Strait Relations 

Political 

On cross-Strait relations, political relations between Taipei and Beijing has cooled since the PRC 

refuses to deal with the Tsai administration unless she accepts the so-called "1992 consensus," a 

tacit agreement reached between the two sides 25 years ago in 1992 that agreed that the two 

sides belonged to One-China and agreed to differ as to their interpretation of its meaning. While 

fonnal channels between the People's Republic of China's (PRC) Taiwan Affairs Office and 

Taiwan's Mainland Affairs Council remain shut after Beijing froze government-to-government 

dialogue back in June 2016, functional channels for cooperation between different ministries 

remain open. 

As a Chinese-speaking democracy, Taiwan has a unique role to play in China's future. But that 

role must not come at the expense of the freedom that the people of Taiwan have fought for and 

now enjoy. The chilling case of the detained human rights activists, Lee Ming-che-who has 

been in detention since March 19-throws into the sharp relief the impact that China's nondemocratic system has for Taiwan and its people-and also for Hong Kong. The 201

h anniversary 

of Hong Kong's retrocession to China will take place on July I. 

While the connection between Taiwan and Hong Kong goes back much farther, a sense of 

solidarity developed in 2014 after the youth-led protests in Taiwan and Hong Kong. The people 

of Taiwan are now keenly aware of the suppression of rights and freedoms that the people of 

Hong Kong face under PRC rule. That bond will likely only grow with time. Indeed, what 

happens in Hong Kong has a demonstration effect in Taiwan, and what happens in Taiwan has a 

demonstration effect in Hong Kong. 

Military 

As the Department of Defense's 2017 China Military Power Report indicates, Taiwan remains 

the People's Liberation Army's (PLA) main "strategic direction," 1 which refers to one of the 

geographic areas the Chinese leadership identifies as endowed with strategic importance. Indeed, 

the Taiwan contingency is the primary driver ofPLA defense planning. Towards that end, the 

PLA is developing anti-access/area denial capabilities to keep adversary forces that might deploy 

or operate within the western Pacitic Ocean in the air, maritime, space, electromagnetic, and 

1 https://www.defense.gov/Portals/1/Documents/pubs/2017 _China_ Militarv _Power_ Report. PDF 

2 
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information domains farther at bay. The PLA reportedly has more than 1,500 missiles targeting 

Taiwan. 

Against the backdrop of a growing military imbalance in the Strait, Taiwan is currently 

embarking on ambitious measures to strengthen its indigenous defense industries and 

capabilities. The Tsai administration just released a new military strategy through its 

Quadrennial Defense Review and reformulated its defense strategy to "resolute defense, multidomain deterrence." As a percentage of total government spending, Taiwan currently spends up 

to 15% on defense, 2 and in March, Taiwan's Minister of National Defense targeted for military 

expenditures to rise to the proverbial 3% of gross domestic product in 2018. 1 In this context, it is 

worth at least asking ourselves why the US demands that Taiwan spend an arbitrary 3% of its 

GDP on defense while expecting less of her other allies and security partners? 

Foreign Relations & Diplomatic Space 

Despite Taipei's measured approach to cross-Strait relations, which is based on three pillars: 1) 

the ROC Constitution, 2) Act Governing Relations between the People of the Taiwan Area and 

the Mainland Area; and 3) the spirit of the 1992 meeting and subsequent negotiations, Beijing 

began unilaterally peeling off Taiwan's diplomatic allies and force other nations to degrade its 

unotlicial relations with Taiwan. 

Indeed, Beijing fired the first salvo that ignited the resumption of cross-Strait tension only one 

month after Tsai Tng-wen was elected president. In February 2016, the PRC decided to resume 

diplomatic ties with Gambia, which had broke diplomatic relations with Taiwan back in 2013; in 

December 2016, the small African nation of Sao Tome and Principe switched diplomatic 

recognition over to the PRC, and in January 2017, Nigeria announced that it was demoting ties 

with Taiwan by forcing Taipei to move its representative o±lice trom Abuja to Lagos. There are 

signs that Beijing is enticing other countries to follow suit and indications are that other countries 

may be on the fence. 

Panama's announcement on June 12 that it has switched diplomatic relations to the People's 

Republic of China is the latest in a series of escalatory steps in Beijing's enhanced pressure 

tactics against Taiwan that include economic, military, and also diplomatic coercion. 

Panama had reportedly sought to establish diplomatic relations with the PRC since as early as 

2008 but was told by PRC diplomats to "remain calm" It was only a matter of time before 

Beijing pulled the trigger despite the Tsai administration's pledge to maintain the "status quo" in 

cross-Strait relations. Considering the public support for the Tsai government's cross-Strait 

approach, rather than delegitimize the government in the eyes of its people-which is Beijing's 

probable intent-its actions will likely be counter-productive and fuel greater public angst and 

animosity towards the PRC. 

2 http://www.tripeitimes.com/News/triwa.n/archives/20 17/03/05/2003666171 1 hllps://www .b1oombcrg.com/polilics/arliclcs/20 17-03 -16/laiwan-p1ans-mililary -spending-increase-lo-co unlcrrising-china 

3 
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Taiwan's informal ties with countries like the United States, Japan, and India are now more 

important than ever as Beijing squeezes Taiwan's international and diplomatic space further. 

Specifically, more efforts need to be made to upgrade Taiwan's ability to engage the 

international community by including Taiwan in bilateral and multilateral exchanges to offset 

Beijing's coercive full-court press on Taiwan's international space. 

While Beijing's pressure tactics weighs heavily on Taiwan's international space, there are 

significant improvements in Taiwan's unofflcial relations with key economic and security 

partners besides the United States throughout the region that militate against these blows. Two 

stands out in particular: Japan and India. 

Most notably, in January 2017, Tokyo changed the name of its de fiu.:to embassy in Taiwan from 

the Interchange Association, Japan to the Japan-Taiwan Exchange Association. In March 2017, 

the Senior Vice Minister of Internal Affairs and Communications visited Taiwan-the most 

senior government offlcial to visit the island since the two sides severed diplomatic ties in 1972. 

Building off the positive momentum of the previous Ma administration's East China Peace 

Initiative, Taiwan and Japan have held multiple maritime dialogues. With New Delhi, the IndiaTaiwan Parliamentary Friendship Forum was formed by members of the lower house of India's 

bicameral parliament in December 2016 to facilitate high-level parliamentary exchanges between 

India and Taiwan. 

Faiwan 's New Southbound Policy 

The Tsai government has also reinvigorated a long-standing policy to diversify its economic 

outreach, which is currently heavily concentrated in China, to the growing markets in the IndoPacific. Through an all-of-government approach, Taiwan is attempting to forge closer economic 

links as well as deepen people-to-people ties with 18 countries in Southeast Asia, South Asia and 

Australasia. The new plan is the natural outgrowth of demographic trends on the island, as more 

children are born of mixed marriages, and just as the United States looked towards Asia in the 

fanner administration's pivot/rebalance strategy, Taiwan is also looking south to capitalize on 

the growing markets and strategic importance of the region. 

While the new plan is still in its infancy, the preliminary assessment appears to be fairly 

successful as Taiwan has been able to off-set the 18% drop in tourists from China with more 

tourists from Southeast Asia 4 Moreover, the growing markets in the region have been receptive 

to the prospect of additional investments and trade with Taiwan, and the Taiwan government are 

creating the safety net mechanism to encourage the backbone of its economy, its small and 

medium enterprises, to take the necessary risks of doing business in the region. 

Beijing's Squeeze on Jmernational ,<,'pace 

Beijing, however, appears intent on cranking the screw on Taiwan's international space. One 

opportunity after the other, Beijing authorities have leveraged its effective veto power of telling 

member countries to block Taiwan's participation in international bodies, even where diplomatic 

recognition was not a prerequisite. Taiwan was excluded from the International Civil Aviation 

1 http://v,'\V\V.dw'.com/en/taiwan-reduces-reliance-on-mainland-chinese-tourists/a-376-1-5694 

4 
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Organization (ICAO) Conference in September 2016, the International Criminal Police 

Organization's (Interpol) 85th general assembly in November 2016, and most recently and 

perhaps egregious violation of decency and respect for human life, Taiwan was not pennitted to 

participate in the World Health Assembly that was held last month. Also, in early May, 

Taiwanese participants to the intergovernmental dialQb'lle on conflict diamond, Kimberly 

Process, hosted by Australia was ejected after the Chinese delegates intennpted the proceeding 

to protest Taiwan observing the dialogue. 

United States 

Second, we have a new president in the United States. An unorthodox president who has not only 

shown that he will not be held back by diplomatic conventions, he has also demonstrated a 

willingness to question policy dogmas, and expressed a penchant for unpredictability. 

As president-elect, Trump made an important gesture by taking a congratulatory phone call from 

President Tsai Ing-wen in December 2016. This is the first time that the leaders of the United 

States and Taiwan spoke by phone, at least since 1979. For a conversation that lasted no more 

than 10 minutes and mainly involved an exchange of niceties, the blowback was disproportional 

and underscores the fragility, as well as complexity, of the US-Taiwan-China relationship. 

US "One-China" policy 

Flirting with suggestions of a shift in longstanding US 'policy,' Trump stated that "!fully 

understand the 'one China' policy, but I don't know why we have to be bound by a 'one China' 

policy unless we make a deal with China having to do with other things, including trade." The 

president-elect was correct The US "One-China" policy is not law and thus has no binding effect 

on the executive branch. However, the perception that Trump would be willing to engage in what 

was perceivably a high-risk gamble gave rise to concerns that even Taiwan's interests may be 

traded away and used as a so-called "bargaining chip." Yet, on the other hand, the Taiwan 

Relations Act (TRA) is domestic law and has a binding effect As the National Security Council 

senior director for Asia recently noted at a DC conference: "We are very much bound by the 

Taiwan Relations Act--hound to continue supporting Taiwan under that act" 5 

Regional Uncertainty 

As the Chairman noted, all of this is occurring against a backdrop of growing regional 

uncertainty about the current administration's policies, strategy, and priorities. 

The administration has identified North Korea's nuclear program as the primary threat in East 

Asia. In its effort to apply "maximum pressure'' on Pyongyang to denuclearize, President Trump 

is clearly attempting to re-enlist the support of Beijing to use its leverage over North Korea to 

stop its provocations. Interestingly, experts have noted that while Beijing's leverage over 

Pyongyang is significant only relative to the United States' and Japan's because the two have 

little to none. Beijing's actual leverage over Pyongyang is, however, perhaps very little. The fact 

5 https://spfusa.org/event/fourth-annual-security-fonun-u-s-japan-alliance-foundation-asian-security/ 

5 
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that North Korea has launched 16 missiles in 10 tests so far in 2017 may be evidence of that lack 

of I everage. 

Therefore, any anticipation of what a tradeoff may bring in terms of actual results must be 

measured by a dose of realistic expectation in what China can and is willing to do. While there 

are no evidence to indicate that the administration is considering such a move, I would simply 

note as caution for the administration to avoid entertaining this seductive idea that has no legs. 

Defense Secretary James Mattis' statement at the Shangri-La Dialogue reaffirming US defense 

commitments to Taiwan based on the TRA was a step in the right direction. More can and 

should be done. 

China 

Third, Beijing is not only not reciprocating Tsai's overtures, it has ratcheted up pressure against 

Taipei. Rather than talk to Tsai, Xi has focused on courting a weakened opposition, applying 

economic pressure on Taiwan to stir domestic discontent, and squeezing Taiwan's international 

space in a full court press to coerce Taipei into submitting to the PRC. The effect has been 

counterproductive to Beijing's stated aim to resolve the issue peacefully. While its objective 

remains the same, there have been some interesting developments related to Beijing's approach 

to Taiwan. 

New Approach, Same Strategy, Old Policy 

Most notably, there have been a number of interesting appointments in the PRC's Taiwan policy 

apparatuses over the last year that appears to signal a change in how Beijing may approach the 

Taiwan issue. Two appointments stand out. 

At the PRC' s premier research institution the Chinese Academy of Social Sciences, the Institute 

of Taiwan Studies' new director Yang Minjie was the fonner Vice President ofClCIR, a 

Ministry of State Security-affiliated research institution. Yang's expertise is in regional security 

and notably not a Taiwan-expert. This is a clear departure from his predecessor who was steeped 

on Taiwan affairs work. The second interesting appointment is that of senior statesmen Dai 

Bingguo as head of the National Society of Taiwan Studies. A national body, which has more 

than 40 member organizations, 1,000 individual members, 40 executive council members, and 

180 councilors including senior representatives from state-run media, central government otlices, 

various government agencies under the State Council, the Academy of Military Science, and 

government research centers. 

I must stress, however, that these appointments should not be seen to indicate that the PRC has 

changed its longstanding policy on Taiwan. Policy remains set at the CCP's Leading Taiwan 

Affairs Leading Small Group headed by Xi Jinping. The all powerful Standing Committee of the 

CCP Politburo is set to change at the upcoming 191

h Party Congress. 

l91

h Party Con&rress 

The CCP is in the process of an important leadership transition that will take place this Fall. The 

transition will see a wholesale change in the make-up of the Standing Committee of CCP 

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Politburo and the political sensitivity surrounding the situation is palpable. One plausible 

explanation for Xi's apparent heavy-handed tactics is perhaps due to a need to appear strong in 

the face of power jockeying that is inevitably occurring behind closed doors in Zhongnanhai. 

East China c'l'ea and South China Sea Linked to Taiwan 

Over the past decade, Beijing has been increasingly aggressive over territorial disputes in the 

East China Sea and South China Sea. In addition to increased military exercises and 

confrontations with navies and coast guards in the region, Beijing established an Air Defense 

Identification Zone in the East China Sea in 2013 and there are reasons to think that it may do so 

for the South China Sea as well. As USPACOM Commander Admiral Harry Harris stated, 

Beijing is building a "Great Wall of Sand" in the South China Sea. I agree with the Chairman's 

assessment that these efforts appear to be directed at ccboxing Taiwan in." 6 Indeed, Taiwan 

remains the primary driver of Chinese defense investments and planning, therefore a Taiwan 

contingency must remain the focus of United States defense planners. 

£conomic Coercion 

Beijing does not hide the fact that it views its economic relationship with Taiwan and other 

countries as leverage. One recent manifestation of this coercive strategy is Beijing's control of 

tourists from the PRC going to Taiwan to apply pressure on Taiwan's economy. 

Despite the drop in tourists from China, total number of tourists to Taiwan actually increased 

2.4% in 2016. This growih was driven by tourists coming from other Asian countries such as 

Thailand, Vietnam, the Philippines, Malaysia, Indonesia, Japan, and South Korea. 

As noted earlier, Taiwan is not the only target of Beijing's economic coercion. In 2010, Beijing 

cut off exports of rare-earth minerals to Japan because of disputes over the Senkakus/Diaoyutai 

Islands. In 2012, Beijing barred the import of bananas trom the Philippine after the Scarborough 

Shoal incident. In 2017, Beijing is applying pressure on South Korea over its deployment of 

THAAD. 

In the face of Beijing's strategy of utilizing all levers of power, the United States should consider 

all means, as the TRA stipulates, "to maintain the capacity of the United States to resist any 

resort to force or other forms of coercion that would jeopardize the security, or the social or 

economic system, of the people on Taiwan." 

Conclusion 

On balance, President Trump's phone call with Tsai signaled nothing more than that his 

administration will not be bound unnecessarily to self-restrictive conventions that demean our 

relationship with a key security partner and democratic ally. 

Despite the mainstream view that the Trump administration was going to break from 

longstanding US policy, his administration ultimately pursued an approach in US-Taiwan 

relations that hewed closely to a "status quo" that has persisted since 1979-in which two 

6 http://v,''"'"·'vashingtonexaminer.com/lawmakers-china-gaining-influence-over-us-allies/article/2625597 

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25846c-8.eps

legitimate governments co-exists across the Taiwan Strait, based on the Taiwan Relations Act, 

Six Assurances, and the US "One-China" policy. 

While many things have happened, very little has changed. 

Although the Strait is currently calmer now after President Trump reaffinned the status quo by 

reaffirming the US "One-China" policy in his February phone call with Xi Jinping, it behooves 

this committee to be aware that while sustaining the status quo may be a viable short-to-medium 

term proposition, the status quo is not sustainable in the long-term. 

The PLA's unprecedented military buildup, growing economic leverage, diplomatic coercion, 

and regional uncertainty over US staying power in the region, leaves Taiwan more susceptible to 

PRC coercion, and thus presents a risk to the peace and stability in the Western Pacific. 

While allies and partners could and should do more for their own defense, the urgency of the 

challenges ahead demands cooperation, and the collective action of our allies and friends in the 

region. In this context, it is necessary to restore a consistent, high-level, and reliable process in 

how the United States engages with Taiwan on anns sales that will have the effect of reassuring 

our friends on Taiwan of US commitment to not only Taiwan but to regional allies and partners. 

Alternatives to a gradual change in policy present equally destabilizing propositions. Yet a fear 

of even thinking about change could lead to state of paralysis that is equally disruptive in the 

Taiwan Strait A one-sided focus on the process has left US interests increasingly susceptible to 

the vagaries of cross-Strait relations and Beijing's increasing leverages to coerce its desired 

political outcome. 

Set against the region's geostrategic uncertainty and increasing pressure on the alliances, the 

United States needs an integrated approach that leverages diplomatic, military, and economic 

tools to strengthen relations with Taiwan and maintain its capacity to help Taiwan resist PRC 

coercion. This integrated approach requires a mix of hard and soft power to strengthen alliances 

and partnership, reduce uncertainty, and minimize miscalculation by all sides. A clearly stated 

objective of soft balancing to shore up the sovereignty gap in the Taiwan Strait would ensure 

lasting peace in the Taiwan Strait Lastly, strategic accommodation of China, especially over 

Taiwan, would be a strategic mistake. Outsized expectation of China's leverage to rein in North 

Korea could disproportionately lead to a miscalculation oftradeoffs that would seriously damage 

US credibility with little gains. 

Recommendations 

The confluence of these factors brings me to my overall recommendation on the urgency for a 

gradual recalibration of US policy towards Taiwan. 

First, especially in the aftermath of the break in diplomatic ties between Taiwan and Panama, I 

wish to commend Ranking Member Shennan and other distinguished members of this committee 

for passing the Taiwan Travel Act, which, as the committee rightfully finds, the United States 

should lift the self-imposed restrictions of high-level visits between otlicials at all levels of the 

United States Government, including cabinet-level national security otlicials, to and from 

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Taiwan. The current approach of conditioning the execution of US law and policy on Beijing's 

reaction in effects leads to creeping deference to Beijing's "One-China" principle, and the PRC 

should not be allowed to dictate how the United States conducts its infonnal relations with 

Taiwan. 

Second, the Global Cooperation and Training Framework (GCTF), launched in 2015, is a critical 

mechanism for enhancing Taiwan's international space. Tt should be expanded and adequately 

resourced. Functional cooperation with Taiwan in "training programs for experts from 

throughout the region to assist them with building their own capacities to tackle issues where 

Taiwan has proven expertise and advantages" are a-political and Taiwan's meaningful 

participation in the international community must not be allowed to be curtailed by the PRC's 

calculated politicization of Taiwan's international space. 

Third, the PRC massive military buildup across the Strait and its continued refusal to renounce 

the use of force against Taiwan is a threat to the peace and security of the Western Pacific area. 

While the United States has managed to deter Beijing from taking destructive military action 

against Taiwan over the last four decades because the latter has been relatively weak, the risks of 

this approach inches dangerously close to outweighing its benefits. Greater clarity of U.S. 

commitments to defend Taiwan is critical for purposes of deterrence and stability. As the PLA 

grows stronger, a perceived lack of commitment by the United States to defend Taiwan may 

further embolden Beijing to use force to resolve the Taiwan issue. 

Fourth, in the face of Secretary of State Tillerson's comments downplaying basing foreign policy 

decisions on American values, Congress could reassert the importance of shared values in 

American foreign policy since "the foundation of US-Taiwan relations is our shared values-our 

commitment to democracy, civil liberties, and human rights." 7 It is at least reassuring to note that 

at his confirmation hearing, the Secretary Tillerson, stated that, "The people of Taiwan are 

friends of the United States and should not be treated as a bargaining chip. The US commitment 

to Taiwan is both a legal commitment and a moral imperative." 8 

Fifth, and perhaps most importantly, President Ronald Reagan's Six Assurances are necessary 

but no longer sufficient. Renewed assurances for Taiwan are needed in this period of growing 

uncertainty. Much has changed since the Six Assurances and other non-papers were issued back 

in 1982. In conjunction with the original assurances, renewed assurances could, as fonner 

Deputy Assistant Secretary of State for East Asian and Pacific Affairs Randy Schriver wrote, 

make clear that preserving Taiwan's democracy as an interest of the United States; honor the 

TRA; not pressure Taiwan into negotiations with the PRC; not support an outcome that does not 

enjoy the support among the majority of the tree people of Taiwan; and not "co-manage'' the 

Taiwan issue with the PRC9 

Ranking Member and Mr. Chairman, thank you again for this opportunity. 

http://docs.house.gov/meetings/F A/F A00/20 1 ~031 ~/10 1903/HHRG-113-F AOO-Wstate-MoyK-20 140314.pdf 

~ hUp://focustaiwan.tw/ncws/aipV20 17030800 19.aspx 9 http://www.taipeitimes.com/News/editorials/archives/2007/llR/22/2001175110/2 

9 
42

Mr. YOHO. Thank you, gentlemen. I appreciate everybody’s statement and your expertise. And that is what I rely on is your expertise to help draft policies of where we go. You know, we know 

where we come from. We have seen the changes happening in the 

Asia-Pacific Theater. 

I was at a conference, I think it was a year ago when we were 

with a bunch of the generals, and they say we are going through 

a tectonic shift in world powers that we have not seen since World 

War II. Then if you parallel that or take that into consideration 

with what is going on in the Asia-Pacific Theater, the South China 

Sea, you see China making international claims to areas that they 

have never done this before. Historically, it has not been done. 

They are following the nine-dash lines and they start claiming sovereignty to areas and start building the islands in those areas, 

militarizing those islands. 

We were at a hearing probably a year and a half ago with the 

Chinese Ambassador and he assured us that the Spratly Islands 

and the islands they were building were for peaceful navigational 

purposes. We just wrote an editorial about that giving our opinion 

on that and that is what it is, an opinion. But I think we can tell 

by the actions what China is doing with the intention of where 

they are going. 

I read Robert Gates’ book called Duty, and they were talking 

about the Taiwanese sales, and it was the last one that we had, 

and they were talking about how we have done this since 1979. 

China has kind of resisted a little bit, but that last one they resisted strongly. Our negotiator asked their admiral what was the 

big concern, we have done this 1979, and their response was this, 

and I think this is very poignant and very succinct on where their 

intentions are. The Chinese Ambassador said, I know you have, but 

we were weak then, we are strong now. 

From that point forward you look at what they have been doing 

since then. They have been isolating Taiwan further and further. 

We saw what they did with the WHO. Taiwan researchers were so 

critical in the SARS epidemic with the research that they did that 

they should be invited regardless of who they are. I would want 

them at the table in those negotiations in those discussions, yet 

China says no, we want them out of here. We have seen them do 

that over and over again as you brought up what they have done 

in Africa, and those countries in Africa have pivoted from them. 

We just saw what Panama—so I think the writing is on the wall 

with the direction. With them, them being China, building in the 

South China Sea and the world stood idly by and allowed them to 

become aggressive, if that aggression is not blocked, if that aggression—I don’t want to say even blocked. If it is not challenged and 

said no, you can’t do this, it is going to continue is what I see happening. I want to just read something here. A real pain you guys 

getting my reading. 

A strong and economically prosperous Taiwan is in the interest 

of the United States and should be one of our core pillars of America’s support for the island. I think that is very succinct and very 

direct on where we should stand and we should work harder to 

work with—I don’t want to say the sovereignty of Taiwan, but recognizing Taiwan as who they are and not cross the bridge or cause 

43

trouble with the One China Policy because they have to deal with 

it. They are right there 110 miles off that coast. 

So my question to you is how do we move forward to protect the 

independent nature of that relationship so that Taiwan can continue to flourish with the development, the economic prosperity, as 

Ranking Member Sherman said with the Freedom House index it 

was 1.5, now they are 1. I mean they are top of the scale—so that 

we don’t go backwards? I know China feels threatened by that. 

How do we bring that assurance so that we can continue the relationship that we have and build upon that? I would hope China 

would look at them as a great example of what can happen without 

fear. 

Mr. Hammond-Chambers? 

Mr. HAMMOND-CHAMBERS. Thank you, sir. Well, a couple of 

thoughts for sure. I would certainly state right off the bat that in 

my view the Taiwan Relations Act has the scope to handle the 

challenge that you have just posed. And that was really the genius, 

the vision of the TRA back in 1979, so I don’t believe that there 

is a requirement to amend what was conceived back then. 

But what we certainly need is more consistency particularly out 

of the executive branch on Taiwan policy. That certainly has undermined efforts particularly over the last 11 to 12 years, successive 

administrations, the absence of consistency and the growing pressure of course the Chinese have placed. It would help at a practical 

level if there was more consideration of Taiwan related initiatives 

separate of consideration of China. 

What might illustrate that point is to point out to the committee 

that when you have representatives of the administration come up 

and speak to you, you will note that often the person responsible 

is responsible for both China and Taiwan. In my view that immediately puts Taiwan and the interests of the United States, vis-avis Taiwan, on a back foot, because that person will reflexively consider China when they consider Taiwan and that is always a larger 

account than it is on Taiwan front. So perhaps separating those, 

making a case to the executive branch that Taiwan should have 

more operating room within the interagency process and within different departments. 

Mr. YOHO. I appreciate that and we are out of time. So I would 

love to hear from you two, but maybe if you can submit that, your 

thoughts on that to the record. Now we will go to Ms. Titus from 

Nevada, for 5 minutes. 

Ms. TITUS. Thank you, Mr. Chairman, and thank you for holding 

this hearing. I am proud to consider myself a good friend of Taiwan. I represent a number of Taiwanese Americans in my district 

in southern Nevada, and I have had the privilege of visiting Taiwan to see the culture and the history and enjoy the food and all 

up close, so I thank you for your hospitality. 

Throughout my time here in Congress too I have worked to 

strengthen the relationship between Taiwan and the United States 

supporting military sales to Taiwan, and Taiwan’s efforts to join 

international organizations. Something that is especially relevant 

to my district is expanding the visa waiver program so people from 

Taiwan can visit without having to have a visa. Last year, we welVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00047 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
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comed close to 1⁄2 million Taiwanese visitors and that included 

about 50,000 to Las Vegas. 

As a representative of Las Vegas, and we love visitors. That is 

something I would like to ask you about. If you haven’t been to Las 

Vegas, please come and see us. I just would ask any members of 

the panel, first, what do you think that we might be able to do specifically in promoting tourism, more tourism between the United 

States and Taiwan as we look to strengthen our relations both politically and economically? 

Mr. HAMMOND-CHAMBERS. On the tourism front, as you correctly 

pointed out, there is already a significant Taiwan population here. 

I think some advertising in Taiwan certainly would help. I think 

if the U.S. is looking to raise the number of Taiwanese visiting the 

United States, advertising specific places like Las Vegas, the incoming NFL team that you have. The Taiwan citizens are voracious 

followers of American professional sports teams and Vegas appears 

to be on a roll in that regard. 

Ms. TITUS. So to speak that is right. 

Mr. HAMMOND-CHAMBERS. I think you have hockey and football 

arriving imminently and surely basketball and baseball will follow 

in time, which is a very exciting time for you. Taiwan citizens follow American sports and that might be something worth advertising to them. 

Ms. TITUS. It is interesting. We have a program, Brand USA, 

where we have tried advertising in parts of Europe. Maybe we need 

to look at not at cutting that program, which has been very successful, but expanding it. 

Mr. Blumenthal or anybody else? 

Mr. BLUMENTHAL. On tourism I think that first of all, going the 

other direction, a number of newspapers and magazines have now 

claimed or reported that Taiwan is one of the best tourist destinations for Americans and the top place for expats to live when they 

do business. In terms of Taiwanese coming here, I think Rupert 

Hammond-Chambers has some good ideas. I think casinos and Las 

Vegas are something the people of Taiwan enjoy and perhaps share 

that enjoyment if we are looking at people to people talks between 

the Chinese and Taiwanese, they share that enjoyment with their 

mainland friends. I think they are going to build some big casinos 

in Taiwan. I think they are a big attraction as well, so I think it 

will always be a place the Taiwanese want to go. 

Mr. HSIAO. Thank you for that question and let me just echo my 

colleagues’ comments so far. I would also just add that the United 

States remains one of the favorite destinations for Taiwanese people to travel to, I think, and the soft power of the United States 

in terms of its appeal to the people of Taiwan, students, is, I think, 

not matched by any other country in the world. 

So improving on that I think is, while I think it is certainly a 

worthwhile and important goal to strive towards, I think there is 

already a high standard there that we are working on and I think 

to improve that I think is to deepen that relationship in a way so 

that we cultivate emerging leaders who are going to be future leaders of both the United States and Taiwan, so that connection is on 

an even deeper level. I think programs that would be able to encourage that would be a vehicle to work towards. Thank you. 

45

Ms. TITUS. Maybe even some exchanges with UNLV’s School of 

Hospitality or that sort of thing. Just real quickly, Mr. Chairman, 

I want to go back to a point that you just made, Mr. HammondChambers. I too share your concern about the mixed messages coming out of this administration, not just to Taiwan but to the whole 

rest of the world. We don’t seem to know who is in charge. Is it 

the President, is it the Secretary of State, is it the non-appointed 

undersecretary? So I think we should really pay attention to the 

need to get our foreign policy in order and not just made from 

Twitter to Twitter. 

Mr. YOHO. The chair will now recognize Mr. Chabot who used to 

be the chairman of the Asia-Pacific Subcommittee, and we thank 

you, sir. 

Mr. CHABOT. Thank you very much. So it sounds like this administration isn’t all that different from some previous administrations, I would note. But in any event, we are both William and 

Mary graduates and we actually like each other a lot and there 

ought to be more William and Mary graduates in Congress, I think, 

don’t you? 

But in any event, when I first came here two decades ago and 

after becoming more and more involved on Taiwanese issues, along 

with Dana Rohrabacher and two Democrats we formed the, we 

were the founding Members of the Congressional Taiwan Caucus, 

and it is one of the largest caucuses and I think one of the most 

important caucuses we have here on Capitol Hill. 

But when I first came here, China had a couple hundred missiles 

aimed directly at Taiwan, now they have 1,600 missiles aimed at 

Taiwan. I consider myself to be a very good friend of Taiwan, but 

some constructive criticism that I would give is one of the more 

frustrating things that I have had. As somebody who is trying to 

be a friend on Capitol Hill, one of the witnesses—I think it was 

you, Mr. Blumenthal—who mentioned that the legislature in Taiwan has to get their act together if we are trying to help them militarily to actually have a sufficient budget and then move forward 

with the budget. 

You had different parties involved, you had the DPP and you 

had, you know, it was a problem. So for years when we were willing to sell them the weapons they couldn’t get their act together 

to buy them, then we had an administration that was less willing 

to sell the weaponry that they needed. 

So I guess my question, and I will go to you, Mr. Blumenthal, 

since I think you brought it up, how can we finally thread that needle and have the decision makers here who want to supply the 

weapons, and the Taiwanese leaders who want to purchase those 

weapons, how do we do that? And then what are the specific things 

that they need? 

I mean obviously it is planes and we were trying for submarines 

here, but they aren’t making anything but nuclear submarines and 

that is really not what they need. They tried France, and the U.S. 

doesn’t make them anymore, a whole range of things. I think the 

one I went on that was a World War II-era submarine. We didn’t 

go out on it but we saw what they had available. 

I will stop rambling and turn it over to you, Mr. Blumenthal. 

46

Mr. BLUMENTHAL. Sure. I think you are right that we ought not, 

as good friends of Taiwan, to let them off the hook either. I think 

3 percent of GDP is not even enough when you are looking at it. 

If you look at other national security states facing that kind of 

threat, from Singapore to South Korea to Israel, 3 percent of GDP 

is actually paltry. 

But there is a chicken and an egg problem, because Taiwan, as 

painful as it is, Taiwan will buy—it may take a long time—but 

they will buy everything we put on offer. So in that $30 billion defense package of 2001, the only thing not bought were the submarines, and that was more of the games that we were playing internally because of not wanting to sell diesel submarines for navy 

reasons. 

So what should we be putting on offer to Taiwan? At this point, 

as you correctly mentioned in terms of the missile threat, the air 

threat and so much more, things that are survivable, so some kind 

of submarine program even if they built it themselves in Taiwan. 

There are licenses sitting in the State Department right now if Taiwan needs to build their own defense that we can offer help with. 

Munitions, stand-off munitions of all kinds, UAVs and UCAVs, 

we have got to think much more creatively and asymmetrically in 

terms of encouraging shore-based land attack cruise missiles. We 

have to think much more creatively about what can survive the initial onslaughts since missile defense won’t be able to do it anymore. 

But we ought not let Taiwan off the hook. 

Mr. CHABOT. Thank you very much. I appreciate that. Let me, 

I have got less than a minute to go so let me just touch on a couple 

of things, and if I had had more time I would have gone into more 

detail. I am concerned about China using the term ‘‘core interest’’ 

now with reference to Taiwan. The PRC using that term in reference to Taiwan that is concerning. It is pronounced Hsiao? 

Mr. HSIAO. Hsiao. 

Mr. CHABOT. Mr. Hsiao, you had kind of raised this issue, and 

again I don’t have time to go into any great detail about it. But 

with North Korea being as great a threat as it has been for a long 

time and continues to be maybe even more so now, well, certainly 

more so now with the development of intercontinental ballistic missiles, and depending on China to help and they have helped virtually nothing up to this point, there is concern that they think 

they can use Taiwan then as a bargaining chip, and that is something that absolutely cannot happen. 

I would strongly urge the relatively new administration not to let 

that happen because Beijing will say lots of nice things and then 

actually delivering on them that is a very another thing, and so we 

should always keep that in mind. And I will certainly, when I talk 

to the State Department those are the types of things that I will 

bring to their attention. Thank you very much and I yield back. 

Mr. YOHO. Thank you, Mr. Chabot. 

Mr. Rohrabacher, you are next. 

Mr. ROHRABACHER. Mr. Chairman, I am sorry that I was late. I, 

actually, you schedule two hearings at the same time you have got 

to run back and forth and that is what this is. 

I have taken a keen interest in Taiwan. During the Cold War, 

Taiwan’s help, especially during the Vietnam War, was instruVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00050 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
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mental in saving the lives of thousands and thousands of American 

military personnel. I was not in the military but on my way to 

Vietnam when I was out of the military I did stop in Taiwan and 

I was part of an operation that was actually headquartered in Taiwan to try to defeat the communists in Vietnam. That is another 

lifetime ago. 

But let me note today, I think all of these years Taiwan has been 

a shining example of human rights. That is one of the reasons that 

the mainland, the gang in the mainland cannot get them out of 

their mind because they know that this is an example where Chinese people are able to make democracy work and in working for 

the benefit of the population. I think Beijing is a klepto-dictatorship that is no longer a Marxist-Leninist under anybody’s definition of Marx and Lenin. 

The people of Taiwan with their free press have been able to 

maintain a semblance of honest government. I am not saying that 

they are pure because they are not, we know, but the fact is, Mr. 

Chairman, Taiwan can show the people of the mainland of China 

that there is a better way, and thus again are playing a very important role in providing for and ensuring that we will have a 

peaceful world. 

Because unless China in some way reforms out of this clique that 

is running Beijing—basically the people in Beijing are trying to 

subjugate their own people and they are ripping them off and they 

are trying to dominate a huge chunk of the planet—unless they can 

get down to what democratic government is supposed to be, and 

that is serving the needs of your own people, there will be a conflict 

eventually. Taiwan is actually the way that we can send that notice that that will not be permitted. 

But I do have a question for you and that is—and I have 2 minutes left. Japan, actually they occupied Taiwan. It was Formosa 

then for a long time. And how many years was that, decades was 

that? Was it 100 years? Was it 50 years? What was that? Well, for 

a significant chunk of history, Formosa was occupied by Japan. 

Can Japan play a role now in the security of Taiwan; will that 

be accepted? Is that something that is too provocative, or would the 

benefits of that—Japan has not played the role that it should play 

in the last 50 years because of their penance for World War II. 

Well, it is time for Japan to start playing a major role again. What 

should that be in relationship to Taiwan? 

Mr. HAMMOND-CHAMBERS. Thank you for the question. I will be 

very quick and then I will hand it over to Dan and Russell. Certainly on the defense side Japan can discretely partner with Taiwan in the development of domestic capabilities that Taiwan seeks 

to produce itself. Japan has a robust defense industry community 

with excellent technologies. I wouldn’t expect them to sell a complete platform or system, but they have many technologies that 

Taiwan could partner with and produce defensive equipment that 

would help maintain peace and security. 

Mr. ROHRABACHER. Very good suggestion. 

Mr. BLUMENTHAL. I would say very quickly, a sort of truth in policy is that there is no defense of Japan and the first island chain 

without Taiwan and Prime Minister Abe certainly knows this and 

has made for Japan revolutionary changes. 

48

But what we can do—without our leadership it won’t go very far. 

An integrated first island chain strategy on our part would harden 

the Ryukyu Island chain further than Okinawa, and then have 

more joint ISR between Taiwan and Japan to be able to track those 

PLA task forces that are going into the Pacific. That is very much 

in our interest. Japan has the attitude and aptitude and willingness to do so, but they would need a signal from us. We can really 

harden that island chain and cause big problems for the PLA Navy. 

Mr. HSIAO. I completely agree with everything that was just said. 

I would just add that it is as much of a political issue as it is a 

military one and I think that there are significant trends, improvements in terms of how Japan is engaging with Taiwan. For instance, changing its de facto Embassy in Taiwan from the Interchange Association to the Japan-Taiwan Exchange Association to 

having a senior vice minister visit Taiwan earlier this year. 

I think that these trends should be encouraged by the United 

States and I think the United States can send a strong political 

signal by upgrading the exchanges between the United States and 

Taiwan, and the Taiwan Travel Act is one example. 

Mr. ROHRABACHER. If there is going to be peace in the world Taiwan and Japan are going to have to play a major role, because I 

believe China is one of the antagonists we have got to deal with 

or they will deal with us. Thank you very much. 

Mr. YOHO. Thank you, Mr. Rohrabacher. And just in time, it is 

your turn. I now turn to Mr. Sherman, the ranking member. 

Mr. SHERMAN. Mr. Hammond-Chambers, what steps can we take 

to export more to Taiwan? 

Mr. HAMMOND-CHAMBERS. Thank you, Mr. Sherman. I do believe 

at the core of that question is an expanded trade relationship that 

would come with some sort of agreement on, again, nomenclature 

can be played around with of course, but let’s for argument’s sake 

call it fair trade agreement. There are a number of areas in which 

Taiwan——

Mr. SHERMAN. Mr. Hammond. 

Mr. HAMMOND-CHAMBERS. Yes, sir. 

Mr. SHERMAN. I am looking for approaches that will reduce the 

trade deficits. So if you are talking about increasing imports as 

well as increasing exports, do you have a suggestion on how we reduce the trade deficit or reach balanced trade? 

Mr. HAMMOND-CHAMBERS. Well, we could certainly sell more 

weapons to Taiwan. That would reduce the trade deficit. Our defense manufacturers are significant——

Mr. SHERMAN. Many of us have advocated that for national security rather than economic reasons, but——

Mr. HAMMOND-CHAMBERS. You did ask. 

Mr. SHERMAN [continuing]. You know, it is—anybody else have 

any ideas how we would reduce the trade deficit? I see no one else 

on our witness panel anxious to answer that one. We will move on 

to the next question which relates to arm sales, but we will address 

Mr. Blumenthal and Mr. Hsiao. 

What are Taiwan’s most pressing needs, and I am asking for 

more of a national security rather than a trade balance answer to 

this. What are Taiwan’s most pressing needs for military hardVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00052 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
49

ware? What arms deals to Taiwan do you think the Trump administration would go ahead with, and should we sell them F-35s? 

Mr. BLUMENTHAL. We have to look now, given the state of the 

cross-Strait balance, at things that are survivable, that are dispersible, that are mobile, that can be underwater and still shoot at a 

landing force, and I think we have to think of things in terms of 

what China has done to us which is help Taiwan build a A2AD network. So——

Mr. SHERMAN. What network? 

Mr. BLUMENTHAL. Anti-access area denial network, the kinds of 

things that China has done. So China has been able through submarines, through integrated air defense, through integrated C4ISR, 

through mining, made it very hard for us to operate in places that 

we used to be able to operate, denying us the space. Those are the 

kinds of things Taiwan can do. 

Mr. SHERMAN. Are there particular weapons systems that would 

fit that? 

Mr. BLUMENTHAL. Submarines, which they want to build in Taiwan but we can have a big component of that, and those are licenses sitting at State right now. 

Mr. SHERMAN. What about the F-35? 

Mr. BLUMENTHAL. F-35, I would look at many different options 

just because of the expense. You can do a lot of UAVs and UCAVs, 

for example, but it is a very expensive platform obviously. 

Mr. SHERMAN. How confident would we be that the PRC has not 

infiltrated somehow Taiwanese defense so that F-35 technology——

Mr. BLUMENTHAL. Well, Taiwan has to do a lot better as do a lot 

of our allies on security assurance and information assurance. 

Mr. SHERMAN. So would you be concerned that if we sold an F35 that there wouldn’t be adequate security? 

Mr. BLUMENTHAL. Well, no, because they have broken into our 

F-35s here and so——

Mr. SHERMAN. They already have the plans. 

Mr. BLUMENTHAL [continuing]. They already have what they 

need. 

Mr. SHERMAN. Why don’t we go on to Mr. Hsiao. 

Mr. HSIAO. Thank you, Ranking Member. 

Mr. SHERMAN. You are not brightening up my day, Mr. 

Blumenthal. Mr. Hsiao. 

Mr. HSIAO. On the F-35s I would just say that the Taiwanese 

military have assessed that they have a need for the F-35s, based 

on exercises that they have conducted on an annual basis, in order 

to execute the missions that they assess as necessary in order to 

deter the People’s Liberation Army. I think any assessment on Taiwan’s defense needs need to be based at least with a strong consideration of what their defense needs are and what they assess their 

defense needs are. 

I would also add that different sales such as submarines to Taiwan also fill a need on the part of Taiwan to be able to engage 

China in a manner that targets their weaknesses. So I think it is 

well known that one of the weaknesses of the PLA is in its ASW, 

which is anti-submarine warfare, and to be able to have Taiwan be 

able to possess and be able to operate submarines within the periphery waters would be necessary for the missions that it sees to 

50

deter Beijing. And then along with that I would also reinforce Dan 

and Rupert’s comments earlier. 

Mr. SHERMAN. Thank you. I see my time has expired. 

Mr. YOHO. We will go to Ms. Wagner. 

Mrs. WAGNER. Thank you, Mr. Chairman. As we all know, this 

week, Panama switched diplomatic relations from Taiwan to China. 

China’s checkbook diplomacy is a dangerous provocation to crossStrait relations, and its cheap tricks in our own backyard are particularly concerning. 

I was impressed with President Trump’s call to President Tsai 

Ing-wen, and I am adamant that we fully engage with Taiwan 

through high level official visits, weapons sales, and pressing for 

Taiwan’s inclusion in international organizations. Taiwan will 

never be a bargaining chip in U.S.-China relations and we must ensure that the Trump administration provides support to our important democratic partner in the Asia-Pacific. 

Mr. Blumenthal, the Trump administration need not alter its 

support of Taiwan or its outreach to our democratic partners in the 

country in order to secure China’s increased support to counter the 

North Korean threat. In fact, bowing to China on Taiwan will do 

no favors for any American policy. How can the new administration 

prioritize Taiwan’s security and democracy even as the President 

courts President Xi Jinping’s collaboration on North Korea? 

Mr. BLUMENTHAL. Well, thank you very much for your statement 

and your question. I think that we have already seen signs that we 

are not just going to be trying to cozy up and get closer to China 

because of North Korea. I think patience in the Trump administration is running thin on the North Korea question with respect to 

China. 

I also look at the recent FONOP or challenge, which in some 

ways was a much more aggressive challenge on the South China 

Sea than we have done in the past, as a sign that we can walk and 

chew gum at the same time. Since we are looking for reciprocity 

with China, China does things we don’t like all the time and we 

still have good relations, we still have cooperative relations with 

them. 

They have militarized, as was mentioned before. They have essentially taken the Paracels, they are gone. They are pretty close 

to taking the Spratlys if we don’t do anything on the Scarborough 

reef or the Scarborough Shoal. So the idea that China can do all 

kinds of things we don’t like and yet seek our cooperation but we 

have to cooperate on everything with China is just false. 

Then finally on your Panama point I would raise this. We always 

talk about our policy on both sides of the Strait to maintain the 

status quo. There is no such thing. China is constantly changing 

the status quo. Going forward and forcing a country or buying off 

a country to de-recognize Taiwan is a major change in the status 

quo. We called Taiwan out on this. We have to call China out on 

this as well. 

Mrs. WAGNER. I agree and it is a provocation. 

Mr. Blumenthal and Mr. Hsiao, does the U.S. face unique challenges in China’s checkbook diplomacy targeting Central America 

as opposed to China’s efforts earlier this year to obtain diplomatic 

51

recognition for—I will try this—Sao Tome and Principe in West Africa? 

Mr. HSIAO. Yes, and thank you for that question. To the question 

on Central America and Beijing’s coercive strategy to isolate Taiwan internationally, I think just as Beijing right now is using a 

multidimensional strategy to isolate Taiwan, I think it is important 

to have a multidimensional strategy to counter that. I think not 

only a bilateral mechanism, there needs to be a multilateral mechanism by which the United States can help to enhance Taiwan’s 

international space. 

I think in this effort, the Global Cooperation and Training 

Framework that has been implemented between the United States 

and Taiwan since 2015 needs to be enhanced, upgraded, and adequately resourced in order to ensure that Taiwan can cooperate 

with the United States and third-party countries to help overcome 

this full-court press that I have described as Beijing’s strategy to 

pick off Taiwan’s allies and also degrade unofficial relations between Taiwan and other countries. 

Mrs. WAGNER. Mr. Blumenthal, any comment? 

Mr. BLUMENTHAL. Yeah, very short. I think we have a particular 

concern with China strategically in Central America without question, but I think China’s main motivation around the world is to 

isolate Taiwan. We should pay special attention to Chinese activities in Central America. 

Mrs. WAGNER. I believe my time has run out. Mr. Chairman, I 

am going to submit the rest of my fantastic questions to this 

panel——

Mr. YOHO. And they are. 

Mrs. WAGNER [continuing]. And they are awfully—for a written 

response. I thank our witnesses and I thank the chairman. 

Mr. YOHO. Thank you, Ann. We will go to Mr. Connolly now from 

Virginia. 

Mr. CONNOLLY. Thank you, Mr. Chairman. It is a pleasure to be 

here both in my capacity as a member of the committee and subcommittee and also co-chair of the Taiwan Caucus. I have had the 

privilege of going to Taiwan 23 times since 1988. I was an Eisenhower Fellow and I have seen extraordinary change. When I first 

went to Taiwan in 1988 it was a one-party state. It was not a functioning democracy and some core freedoms we cherish and so does 

Taiwan today were not cherished in 1988. There were serious restrictions on speech and political organizing, on dissent and on 

travel and on investment in the mainland. I have witnessed over 

that time period one of the greatest changes in a nation I have ever 

witnessed, and I have traveled a lot. 

I wonder, Mr. Hsiao, probably when I first went there you 

weren’t born, but to what would you attribute, and all of you could 

comment. Why this profound change? I mean what happened in 

Taiwan? Was it something unique to the people of Taiwan or what 

was the spark or evolutionary process that led us to this open 

democratic society in sharp contrast to the other place? 

Mr. HSIAO. Thank you for that very profound question, Representative. I think there are two factors. There are internal and 

external factors. The external factor, I think, is driven by the loss 

of recognition, the de-recognition by the United States to the PRC 

52

that pressured the government from the top down to liberalize, to 

integrate more Taiwanese into the political process in order to establish a greater foundation for legitimate rule. 

And then also at the same time and to give credit to the Taiwanese people who have strove to have a greater freedom and democracy. I think the United States has played a pivotal role in supporting that democratic movement in Taiwan in the ’80s and ’90s 

onward. So I would say that it is a confluence of these factors that 

really drove Taiwan to become the democratic example and model 

that exists now, to the extent now that it can serve as a model for 

Southeast Asian countries that are making similar sort of progressions in their political developments. 

Mr. CONNOLLY. Mr. Hammond-Chambers, I assume that many of 

the companies that are members of your Council also operate in 

the mainland. 

Mr. HAMMOND-CHAMBERS. That is correct. 

Mr. CONNOLLY. And so how does that work? I mean are they 

under pressure from Beijing to disinvest in Taiwan or do they turn 

a blind eye? Do they welcome it? What is that relationship like, 

what kind of pressure are they under, if any? 

Mr. HAMMOND-CHAMBERS. Typically they aren’t under any pressure at all. There are several instances where U.S. companies have 

been identified by PRC authorities in an attempt to be pressured 

and those typically relate to PRC interpretation of the company 

overstepping grounds regarding Taiwan sovereignty. So perhaps 

they might have published something that had Taiwan’s official 

name Republic of China in it, or in some of the instances where 

some of our larger defense companies have interests in the mainland as well they might have been identified. 

I have been the U.S.-Taiwan Business Council for over 20 years. 

I am not aware of a single instance, however, in which a U.S. company had a long-term impact on its interests in the mainland as 

a consequence of the fact that it is doing business on Taiwan. 

Mr. CONNOLLY. Very interesting. So while Beijing is pressuring 

the countries like Panama to switch recognition, they are not doing 

the same in the business side. 

Mr. HAMMOND-CHAMBERS. Correct. It is all about the business, 

Mr. Connolly. 

Mr. CONNOLLY. Yeah. Mr. Blumenthal, and by the way you can 

comment on other things as well, but earlier before this hearing, 

I know you are aware, we actually approved a bill that for the first 

time, well, in a long time, has Congress saying enough. We are 

going to address some issues that we have kind of ceded to the 

State Department and the White House over many administrations. 

I wonder if you might comment on that because one of the things 

that has concerned me, and wear my other hat in the Taiwan Caucus, is how much at least tacit control we have given to Beijing in 

terms of the nature of the relationship with Taiwan. We have a 

statute, the Taiwan Relations Act, which came out of the committee I used to work for that was initiated by Congress and that 

is the guiding document about the relationship. That document 

commits us to a certain posture with respect to Taiwan’s defense 

including the sale of defensive weapons. 

53

I don’t know that that statute says the President of Taiwan can’t 

come to the United States or to Washington, DC, and yet I remember Presidents of Taiwan calling me kind of on the sly when they 

were at an airport so we could talk because there was no official 

visit here. I understand a Presidential Head of State visit is one 

thing, but I mean putting a bag over your head and pretending you 

don’t exist is quite another. 

So I know that is a long question, but I really am bothered by 

how much power we seem to have ceded Beijing on many facets of 

the relationship. I am very grateful, Mr. Chairman, that this subcommittee and hopefully the full committee is taking some of that 

back, finally. But I wanted your comment and then I am done. 

Thank you. 

Mr. BLUMENTHAL. Well, I agree wholeheartedly. I mean, there 

are many, many factors involved. There is nothing in these communiques, which again are simply joint statements between countries 

made in the 1980s and 1970s, at a very different time that says 

anything about who our President can call or speak to or visit or 

meet. That is somehow a mystical paper in the State Department, 

somewhere that was written probably 30, 40 years ago, somebody 

interpreting what we meant by those communiques. We may be 

stuck with those communiques in the One China Policy, but we are 

certainly not stuck with China telling us whom we can meet with. 

It is so very much in our interests, and in their interests that we 

keep an ongoing high level dialogue with Taiwan for the sake of 

predictability and stability. 

I would finally say that one thing that a lot of people are looking 

at now is the level of Chinese propaganda and political warfare the 

Chinese Communist Party targeted against the United States. It is 

much different than Russia or other rivals, but it is a huge problem 

and it has changed the minds of many people. 

They have convinced many important people including probably 

policy makers that the communiques say something that they 

don’t, that we acknowledge that Taiwan is part of China. We do 

not. We leave the status to be determined by the two parties. They 

have made great headway and it is an active political warfare campaign. It is not just passive diplomacy or neglect. 

Mr. CONNOLLY. Thank you. And Mr. Chairman, thank you. 

Mr. YOHO. Mr. Connolly, I would like to work on some of this 

stuff to draft policies that we can direct maybe the State Department or the administration. 

We are going to, if you guys have enough time I would like to 

go back to Ranking Member Sherman and then I would like to end 

with a couple statements. 

Mr. SHERMAN. Mr. Hammond-Chambers, we have had this description of how China is on the international stage trying to hem 

in, delegitimize Taiwan, but I wonder how that squares with their 

economic behavior. Can you describe cross-Strait investment and 

cross-Strait trade over the last few years? 

Mr. HAMMOND-CHAMBERS. Yes, Mr. Sherman, it continues to expand quite frankly. The economic links between the two sides remain robust, somewhat cooled down since Tsai Ing-wen took over. 

But for the most part——

54

Mr. SHERMAN. How big is the investment of each country in assets in the other——

Mr. HAMMOND-CHAMBERS. The PRC investment in China is 

tightly held, so very minimal. 

Mr. SHERMAN. PRC investment in Taiwan? 

Mr. HAMMOND-CHAMBERS. In Taiwan is minimal. There are some 

areas that the PRC could invest in but it is quite tightly held now. 

Conversely, in China, Taiwan investment is massive and a lot of 

it has circumvented regular ways to monitor, so I have seen numbers ranging from $100 to $250 billion worth of Taiwan capital invested in China. 

Mr. SHERMAN. And what do we do to persuade the Taiwanese 

that putting their investments in a country that may seize them 

at any moment may not be as desirable as investing in the 30th 

Congressional District of California? 

Mr. HAMMOND-CHAMBERS. Well, I think there are many Taiwanese who would like to do nothing more than invest $250 billion 

in your district, sir, but I——

Mr. SHERMAN. One billion at a time. 

Mr. HAMMOND-CHAMBERS. Okay. But there are many people in 

Taiwan including the present Taiwan administration that have 

deep concerns about what has transpired over the last 20 years and 

have policies such as the Southbound Policy to try and curb that. 

However, they have limited control over their businesses in this regard who have less of an interest in the national security concerns. 

Mr. SHERMAN. They have a lot of control if they choose to pass 

laws, and if they choose to simply do what is politically popular 

with the economically important then they have no power. The idea 

of creating what could be as high as a $250 billion investment in 

Beijing creates powerful forces in Taipei to lobby for the Beijing position. 

A failure of a business to conduct such lobbying could impair the 

value of their investment or cause their investment assets to decline in yield or to be treated as favorably. The prospect of the seizure of those investments should there be some sort of crisis means 

that you have very powerful economic interests that may want to 

reunify on any basis that protects those investments. But again the 

opportunities in the 30th congressional district are still available. 

I will go to the other witnesses. And also in Florida there is some 

excellent——

Mr. YOHO. I am glad you added us in there because your side—

no offense—you are promoting that and she is promoting the casinos. I am like we need to throw Florida in there. 

Mr. SHERMAN. We will throw Florida in there a little bit, but 

once they see the opportunities in the 30th district—let’s see. How 

can and in what cases is China, well, I guess in every case China 

has tried to keep Taiwan out of international organizations. So the 

question is, really, is how can Congress help resist such pressure 

and what can we do to assist Taiwan in joining all the international organizations from the World Health Organization to Civil 

Aviation to U.N. Framework on Climate Change, Interpol, et 

cetera? Mr. Blumenthal, then Mr. Hsiao. 

Mr. BLUMENTHAL. Well, we already very much have the international legal basis to do so because of the WTO accession and TaiVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00058 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
55

wan’s accession into it. So all the arguments that China makes 

against Taiwan’s membership particularly in organizations that 

don’t require statehood, or a recognition of statehood, are very specious because they agree to the WTO accession already. 

Mr. SHERMAN. And does WTO require statehood? 

Mr. BLUMENTHAL. We negotiated in a way that didn’t and so we 

have the basis now, the diplomatic and legal framework to negotiate Taiwan’s accession to any international organization that 

doesn’t require statehood. 

Mr. SHERMAN. So why does China work so hard in their effort 

to delegitimize the sovereignty of Taiwan to keep Taiwan out of organizations’ membership in which does not establish sovereignty? 

Mr. BLUMENTHAL. Because there is very little pushback. So for 

example, we can have an FTA—we have the basis of an FTA in 

international law and diplomatic custom. 

Mr. SHERMAN. You are saying FTA or DA? 

Mr. BLUMENTHAL. Yeah, I know. I don’t mean to talk about the 

trade deficit. We could theoretically have a free trade agreement, 

but China pushes back by saying that that would confer statehood 

upon Taiwan, a completely specious argument given——

Mr. SHERMAN. Especially if the agreement provided for a reduction in the trade deficit. Let me go on to Mr. Hsiao. What can Congress do to help Taiwan get into these international organizations? 

Mr. HSIAO. Thank you, Ranking Member. I would just add that 

I do think there needs to be a more inclusive approach in dealing 

with Taiwan’s international space and how the United States 

strategize its approach to getting Taiwan into international organizations. I would add that I think there is a good existing mechanism through the Global Cooperation and Training Framework, 

and I think that it can be expanded to lead as an example of how 

Taiwan and the United States can cooperate with third-party countries in trying to in areas of health alleviation, in areas of women 

empowerment, in democratization, energy, that these are functional areas of cooperation where people will see, other countries 

will see the value of Taiwan’s contribution, and any efforts on the 

part of the PRC to limit that would just fly in the face of decency 

of what is necessary for as Taiwan as a contributing member of the 

international community. 

Mr. SHERMAN. I yield back. 

Mr. YOHO. Thank you. If you will indulge me just for a few more 

minutes, what I have gained and what I have deemed out of this 

is we see an aggressive China. We see that they are continuing 

this. We are seeing they are putting more pressure on the international community to exclude Taiwan as a semi-independent state 

of their own, a democracy that has been very successful, very fruitful, and we keep hearing that we need to partner with China. I 

think China needs to partner with us and the rest of the free 

world. 

I say that when we look at our trade, the last report I had China borrowed, stole, or highjacked over $600 billion of intellectual property. I don’t want a partner like that. We need to put more pressure—and like you said, Mr. Blumenthal, the reason they are doing 

what they are, nobody is standing up. It is time to stand up because we see the writing on the wall. If we don’t do it now, it will 

56

be easier to do it now than to wait another 5 years because Taiwan 

will be that much more isolated. The South China Sea will also be 

that much more boxed in, and then the trade that we talk about 

and the spread of democracy of our tenth largest trading partner, 

it will affect us. 

So coming out of this meeting I always like to have action items. 

When I read the USTR’s recommends that the Trump administration end the policy of packaging and return to a regularized process, whereby Taiwan would be treated like other security assistance partners all the way from the U.S. accepting letters of request 

for pricing and availability data to consulting with notifying Congress of an intention to sell arms to Taiwan. We have put it into 

this quagmire or this box where, yeah, we are doing it but we are 

kind of hiding it so we don’t want to offend anybody. I think we 

need to go back to be bold and just say yeah, we are, because it 

is in the 1979 agreement. 

We have also, as an action item we put in a free trade agreement 

that we entered as House Resolution 271 in April 6th of 2017. I 

think there is still time for you to get on that even in the 33rd district of California. 

Mr. SHERMAN. Yeah, as long as we add a provision about requiring a system to reach balanced trade I will be on it. 

Mr. YOHO. I want to touch base on that right now as a little 

aside on the trade deficit. It remains large, but Taiwan has imported larger and larger percentage of imports from the U.S. over 

recent years, and by a percentage our deficit has been cut in half 

over those years and we are going in the right way. 

But as far as more action items and I think you heard a resounding theme in here and I agree wholeheartedly with this, and that 

theme is Taiwan will not be used as a bargaining chip and I think 

China needs to understand that from this point forward. I think we 

will stand real strong and we will get the rest of the countries to 

do that too. 

You know, the freedom of navigation, we need to do more of 

those because China has created on their islands, according to their 

Ambassador that I talked to, lighthouses on the Spratly Islands 

strictly for peaceful navigational purposes. I agree, and I think we 

should all utilize that and thank them for that. 

The free trade agreement, like I said, we introduced on April 6th, 

and letters of support for the importance of the contributions of the 

health, worldwide health organizations that Taiwan has contributed to, and we are sending letters to support their inclusion in 

these organizations, and we haven’t had a communique since 1982. 

When you read those it is kind of like your parents, well, yeah, 

you can go ahead and do that but don’t tell your mom or don’t tell 

anybody you are doing that. I mean that is the way I read those 

and I think we need to come out, maybe it is time for a fourth one 

that has clarity and purpose so that we can go into the 21st century with a clear direction, a peaceful direction, and it is time that 

we as the United States showed the leadership in that. 

Do you guys have anything that you want to end up with, maybe 

30 seconds apiece? Mr. Hammond-Chambers? 

Mr. HAMMOND-CHAMBERS. Yes, just very quickly, Mr. Chairman, 

I would just like to point out on my colleague’s point about inforVerDate 0ct 09 2002 10:53 Jul 27, 2017 Jkt 000000 PO 00000 Frm 00060 Fmt 6633 Sfmt 6633 F:\WORK\_AP\061517\25846 SHIRL
57

mation warfare, we had this week we had the switch in recognition 

from Panama. One of the challenges that we face is that the PRC 

continues to define what our One China Policy is. 

Mr. YOHO. Exactly. 

Mr. HAMMOND-CHAMBERS. And it does real, real damage. I understand Mr. Tillerson was up on the Hill yesterday. He said the 

One China Policy. I commend you in saying our One China Policy, 

because what the Chinese like to do is they like to define our One 

China Policy as their One China Principle. And regrettably, all too 

often it shows up in our media. 

Mr. YOHO. Right. 

Mr. HAMMOND-CHAMBERS. Two days ago, USA Today, yesterday, 

the Washington Post and the Associated Press, the Chinese definition of the One China Principle as our One China Policy, so I would 

certainly encourage you and your committee members, sir, when 

you have an opportunity to be very clear about U.S. policy on that 

standpoint. 

Mr. YOHO. Thank you. 

Mr. Blumenthal? 

Mr. BLUMENTHAL. Yeah, I agree with all of your suggestions. I 

would include in that getting the State Department, Defense Department, and intelligence agencies to report on China’s active information warfare, political warfare against us in a——

Mr. YOHO. Stay tuned, we have a good bill coming out on that. 

Mr. BLUMENTHAL. Good. You know what, I am not as smart as 

you guys. You are ahead of me. 

Mr. YOHO. It is the guys behind me. 

Mr. BLUMENTHAL. But I would caution against a fourth communique because I think that doesn’t include Taiwan and the Chinese 

have gotten the better end of the stick on the last three. 

Mr. YOHO. I intend to have it written to where it, you know, I 

don’t want to say make America great or put America first, but the 

only way you can do that is if you help your partners you are dealing with become very successful too. 

Mr. BLUMENTHAL. Right. The greater point I was making is that 

we have no other policy, just based on joint statements made in the 

Cold War and it is ridiculous. 

Mr. YOHO. It is. It is absolutely ridiculous. 

Mr. BLUMENTHAL. It does not reflect——

Mr. YOHO. In the 21st century with superpowers. 

Mr. BLUMENTHAL. That is right. It doesn’t reflect the geopolitical 

moment anymore. 

Mr. SHERMAN. I would add one other thing. There is an Article 

I to the United States Constitution. It provides for the ratification 

of treaties. Nothing that you are describing, a press release from 

a President no longer living is not binding on the people of the 

United States. The Vienna Convention on the Law of Treaties, you 

have got ratified treaty, you have got legislative executive agreement, unratified treaty, and then you have got press releases from 

no longer living Presidents. 

Let me put this another way. A ratified treaty is like a minister, 

a groom, a bride, rings. This communique is like five margaritas 

at a seedy singles bar——

Mr. YOHO. In California. 

58

Mr. SHERMAN [continuing]. In California. And let me tell the 

chairman that certainly five margaritas at a seedy singles bar in 

California is not a binding commitment. Thank God. 

Mr. YOHO. Mr. Hsiao, do you have something you want to end 

up with? 

Mr. HSIAO. Thank you, Chairman. Thank you, Ranking Member. 

I think I would just like to close on the need for a greater clarity 

on U.S. defense commitments to Taiwan. I say this with sincerity, 

that the massive military buildup across the Strait and China’s 

continued refusal to renounce the use of force against Taiwan is a 

threat to the peace and security of the Western Pacific area. 

While the United States had managed to deter Beijing from taking destructive military action against Taiwan in the last four decades, I think when China was relatively weak, and I go to the point 

that you have made, the premise of China saying that it was weak 

then it is stronger now, that we are approaching dangerously close 

to where the benefits of this, the cost outweighs the benefits. 

So I think as the PLA grows stronger, a perceived lack of commitment by the United States to defend Taiwan will further embolden Beijing to use force to resolve the Taiwan issue. Thank you. 

Mr. YOHO. I think that was very well spoken by all of you, and 

I thank you for wrapping it up that way. I liked the levity of it. 

I didn’t know you had so much levity. That is good to know. But 

I appreciate your thoughts, your expertise, and what you do, and 

we will move forward with some of the suggestions you had. Reconsider the fourth communique and maybe consult you before we go 

forward. 

That pretty much concludes this hearing and we thank everybody for participating. We thank the crowd for being here. You 

guys were great to stay here the whole time in this hot room. This 

committee hearing is adjourned. 

[Whereupon, at 4:20 p.m., the subcommittee was adjourned.] 

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SUBCOMMITTEE HEARING NOTICE 

COMMITTEE ON FOREIGN AFFAIRS 

U.S HOUSE OF REPRESENTATIVES 

WASHINGTON, DC 20515-6128 

Subcommittee on Asia and the Pacific 

Ted Yoho (R-FL), Chairman 

June 15,2017 

TO: MEMBERS OF THE COMMITTEE ON FOREIGN AFFAIRS 

You are respectfully requested to attend an OPEN hearing of the Committee on Foreign Affairs, to be 

held by the Subcommittee on Asia and the Pacific in Room 2200 of the Rayburn House Office Building (and 

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DATE: 

TIME: 

SUBJECT: 

WITNESSES: 

Thursday, June 15, 2017 

2:45p.m 

Renewing Assurances: Strengthening U.S.-Taiwan Ties 

Mr. Rupert J. Hammond-Chambers 

President 

U.S.-Taiwan Business Council 

Mr. Dan Blw11enthal 

Director of Asian Studies and Resident Fellow 

American Enterprise Institute 

Mr. Russell Hsiao 

Executive Director 

Global Taiwan Institute 

By Direction of the Chairman 

seeks to make its faciliries accessible to persons 1drh disabihties. If.vou are in need of 

call 202/225-5021 at least busim-'ss 111 advancl! of thf' f'venl, whenf'ver 

to ,\pecwl accommodations general availahility of( 'omnnllee materials m 

flsiemnedn•lces/ may he dwecled io ihe 
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COMMITTEE ON FOREIGN AFFAIRS 

MINUTES Ol' SUBCOMMITTEE ON ______ &_tb_c_m_"m_,_·u_ee_o_"_A_s_ia_a_"_"_"'-'_P_ac-=(fi_,e _____ HEARING 

Day_---=T.~'hc::u::.:rs:.:ll:::uy"---_nate __ =..Ju:.::n::.:e=-=..15:2,c:2:..::0c:l.:..7 __ Room _ __::2:.-:2c:O.::.Oc:RB=O=']J'--

Starting Time _ __,2":oe50'"p"'m"'--_Ending Time __ 4,_,:.,_2"'-0pLm"-'---

Recesses:-- ( __ to __ ) L_lo __ )( __ to __ ) L_to __ ) L_to __ ) L_to __ ) 

Presiding Member(s) 

Rep. Ted Yoho 

Check all of the following that app(v: 

Open Session GJ Rxecutive ~sed) Session D Televised U 

TiTLE OF HEARING: 

Electronically Record!&{taped) 0 

Stenographic Record U 

''Renewing Assurances: StrengtheninJ.: U.S.~Taiwan Ties" 

SUBCOMMITTEE MEMBERS PRESENT: 

Rep. Ted Yoho, Rep Steve Chubot, Rep. Danu Rohrabacher, Rep. Ann Wagner 

Rep. Brad Sherman, Rep. Ami Bera, Rep. Gerald Connolly, Rep. Dinu Titus 

NON-SUBCOMMITTER MEMBERS PRESENT: (Mark with an *if' they are not members of full commillee.) 

Rep. Ed Royce 

HEARING WITNESSES: Same as meeting notice attached? Yes m NoD 

(If "no", please list heluw and include title, aJ;ency, department, or organization.) 

STATEMENTS FOR THE RECORD: (List any statements submittedfor the record.) 

Rep. Wagner QFR 

TIME SCHEDULED TO RECONVENE ____ _ 

or 

TIME ADJOURNED ________ __ 
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Statement and Qnestions for the Record 

Congresswoman Ann Wagner 

"Renewing Assurances: Strengthening U.S.-Taiwan Ties" 

June 15,2017 

Thank you, Mr. Chairman, for organizing this hearing. As we all know, this week, Panama 

switched diplomatic relations from Taiwan to China. China's checkbook diplomacy is a 

dangerous provocation to cross-strait relations, and its cheap tricks in our own backyard are 

particularly concerning. I was impressed with President Trump's call to President Tsai Ing-wen, 

and 1 am adamant that we fully engage with Taiwan through high-level official visits, weapons 

sales, and pressing for Taiwan's inclusion in international organizations. Taiwan will never be a 

bargaining chip in U.S.-China relations, and we must ensure that the Trump Administration 

provides support to our important democratic partner in the Asia-Pacific. 

I. Mr. Blumenthal, the Trump Administration need not alter its support of Taiwan or its 

outreach to our democratic partners in the country in order to secure China's increased 

support to counter the North Korean threat. In fact. bowing to China on Taiwan will do no 

favors for any American policy. How can the new Administration prioritize Taiwan's 

security and democracy even as the President courts Xi Jinping's collaboration on North 

Korea? 

2. Mr. Blumenthal and Mr. Hsiao, does the US face unique challenges in China's checkbook 

diplomacy targeting Central America? (As opposed to China's e±Iorts earlier this year to 

obtain diplomatic recognition from Sao Tome and Principe in West Africa.) 

Mr. Hsiao's Response: The PRC's checkbook diplomacy into Central America presents an 

unique challenge for the United States in the sense that the region is the United States' 

backyard. Beijing's establishment of diplomatic relations with Panama is a signal of China's 

growing int1uence in the region. While the PRC's checkbook diplomacy bears directly on 

Taiwan's diplomatic space, it also has an indirect and significant impact on the United 

States' strategic interests. Although China's motive in the region has been primarily 

commercial, the Panama case demonstrates that its interests extend beyond purely 

commercial matters and could be seen as an e±fort to balance against US. longstanding ties 

with its Asian allies and partners. 

3. Mr. Hammond-Chambers, Taiwan has rolled out a new economic strategy that focuses on 

increasing ties with ASEAN and South Asia. How can the government help Taiwanese 

companies shift corporate strategy away from China and into new markets? 

Mr. Hammond Chambers' Response: The New Southbound Policy (NSP) is intended to 

expand both bilateral trade and mutual investment between Taiwan and 18 countries in 

Southeast Asia, South Asia and Australasia, with a particular focus on people-to-people ties 

and on developing entrepreneurships and encouraging startups. The Taiwan government 

could take a number of steps to incentivize its domestic companies to pursue business with 

these countries, rather than continuing to focus on China: 

• Providing tax credits and other incentives to Taiwan businesses that 
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source materials or labor from NSP countries 

• Developing loan and grant programs for Taiwan businesses that make 

new investments in NSP countries 

Directing state-owned enterprises to focus their business priorities 

on NSP countries 

• Enacting government contracting standards that prioritize businesses 

embracing the NSP 

• Negotiating additional bilateral (or multilateral) trade agreements 

with NSP countries, to encourage expanded trade ties (Taiwan already has trade 

agreements with several countries covered under the policy, including New Zealand 

and Singapore.) 

• Unilaterally reducing trade barriers and relaxing trade restrictions 

for NSP countries, to encourage the free tlow of goods and services 

Focusing its NSP etTorts on specific sectors where included 

countries are clamoring for investment (e.g. infrastructure, where India has expressed 

its interest in receiving foreign investment) 

Making further efforts to cooperate with the NSP countries on 

specific issue areas of mutual concern, in order to open additional markets for Taiwan 

companies. (e.g. Taiwan's recent initiatives to provide medical assistance and 

agricultural technology) 

• Continuing efforts to sponsor business matching events for NSP 

countries, and continuing to aid Taiwan companies in setting up distribution outlets 

through the region 

4. Mr. Hsiao, earlier this year, China released nine Singaporean armored transport vehicles after 

holding them in Hong Kong for two months in retaliation for Singapore's military 

relationship with Taiwan. Can we expect China to continue to take such action against 

Singapore and others in the future if cross-strait tensions remain high? 

Mr. Hsiao's Response: Beijing's strategy is to coerce Taiwan's leaders into accepting its 

terms for negotiation on unification by dividing Taiwan internally and isolating it 

internationally. The PRC has been utilizing its considerable economic, diplomatic, and 

military clout, especially over smaller but key non-diplomatic partners of Taiwan to prevent 

them from engaging with Taipei in ways that it considers to run afoul of its "One China" 

principle. It is also using these means to express its opposition to the Taiwan government's 

approach to cross-Strait relations. Indeed, the PRC has insisted that Taiwan accepts the socalled "1992 consensus," which the Tsai administration has resisted in explicitly affirming 

despite her commitment to adhere to the ROC constitution, Act Governing Relations between 

the People of the Taiwan Area and the Mainland Area, and the historical fact of the 1992 

meetings and subsequent understandings. Beijing's efforts to pressure Singapore is as an 

attempt to broaden the application of its "One China" principle, and pressure countries with 

significant political, economic, and military ties with Taipei to conform to its preferred 

definition of cross-Strait relations. The case of Singapore will not likely be an isolated 

example. 
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5. Mr. Blumenthal, in addition to or alongside a Free Trade Agreement, what can the United 

States do to increase economic engagement with Taiwan under the Trump Administration?