Week of Jan. 3-9, 2015

A national flag-raising ceremony in Washington, D.C., caused a bit of a stir between Taiwan, the U.S. and China; Former president Chen is finally granted medical parole; Public attention shifts to President Ma and his aides’ alleged dealings with the business sector as well as the Chinese Nationalist Party’s (KMT) party assets. Welcome to this week’s issue of the Insider.



FLAG-RAISING IN DC: Media reported on Saturday that a Jan. 1 flag-raising ceremony at the Twin Oaks Estate in Washington — the former residence of Republic of China (ROC) ambassadors to the U.S. — was a “diplomatic breakthrough” as it was the first such ceremony since the U.S. severed ties with Taiwan in 1979. No members of the press attended the ceremony, described by Taiwan’s representative office in Washington as a “low-key” event symbolizing “the success of President Ma Ying-jeou’s (馬英九) ‘flexible diplomacy.’” Shen Lyu-shun (沈呂巡), Taiwan’s representative to the U.S., said the ceremony was held based on solid “mutual understanding” and consensus.

However, Shen, who returned to Taiwan following the ceremony, told reporters on Tuesday that neither Taipei nor Washington had been informed of the plans in advance. In a parliamentary session on Wednesday, Shen defended his decision, saying the ceremony was what every diplomat should do and that he was not obliged to report everything in advance to the U.S. government.

BEIJING AND US REACTIONS: Beijing lodged a strong protest upon hearing of the ceremony and urged the U.S. to respect the “one China” policy.

US State Department spokesperson Jan Psaki told a press briefing on Monday that the ceremony was “not consistent” with U.S. policy. “We did not know about the Jan. 1 flag-raising at Twin Oaks in advance,” she said. Psaki said on Tuesday that flying the ROC flag “violated” a previous agreement and that the U.S. was “disappointed.”

American Institute in Taiwan (AIT) spokesperson Mark Zimmer on Thursday reiterated that while bilateral relations remain “strong,” the U.S. was disappointed. In a three-point statement, the AIT stated:


We reiterate that we did not approve or know about the January 1 flag-raising at Twin Oaks in advance.

We are disappointed with this action, and we have raised our serious concerns with senior Taiwan authorities in Taipei and Washington.

It is our hope that Taiwan will demonstrate the priority it puts on the U.S.-Taiwan relationship by ensuring that these kinds of things do not happen again.


US Department of State officials have opened formal discussions with Taiwan on the issue. The talks are taking place in Taipei and Washington at what one source described as “a senior level.”

REACTIONS IN TAIWAN: Here at home, almost every politician assumed that Shen had consulted the U.S. in advance. Most lawmakers recognized Shen’s efforts, though Democratic Progressive Party (DPP) lawmakers asked whether Shen might have placed his personal interests before those of the country. Chinese Nationalist Party (KMT) lawmaker Lin Yu-fang (林郁方) said the controversy was a “bump in the road” and a “tempest in a teapot.”

DPP secretary-general Joseph Wu (吳釗燮), who served as representative to the U.S. under the DPP administration, said the ceremony had not respected diplomatic protocol and that Shen’s “unilateral move” highlighted a lack of communication and could hurt bilateral ties.

Deputy foreign minister Andrew Kao (高振群) said on Wednesday that the event had a “disturbing effect” in Washington.

Former president Lee Teng-hui (李登輝) said on Thursday that Twin Oaks was Taiwan’s property and that flying a flag over one’s own property was appropriate, adding that Washington had made a big deal of the issue “because it fears Chinese opposition.”

Lin Chong-bin (林中斌), former Mainland Affairs Council deputy minister, said the ceremony was at best symbolic but did not help Taiwan-U.S. relations. Former foreign minister Cheng Chien-jen (程建人) said the ceremony would had crossed a red line in Washington if the flag-raising ceremony was disallowed in future.



CHEN GRANTED MEDICAL PAROLE: Ailing former president Chen Shui-bian (陳水扁) was released from prison on medical parole on Monday after serving six years and 40 days for a graft conviction relating to his presidency. Accompanied by his son Chen Chih-chung (陳致中), Chen returned to his residence in Kaohsiung.

Chen, who was released after the approval of a 10-member review panel on Monday, is subject to another round of review in 30 days to decide whether he will be sent back to prison if his health condition improves, according to medical parole regulation.

Chen Chih-chung said his father would not make any public speeches, accept interview requests or attend political events in the initial month of his parole. Justice Minister Luo Ying-shay (羅瑩雪) warned Chen Sr. against appearing as a guest speaker on TV political talk shows.

DPP, KMT REACTIONS: Led by DPP Chairperson Tsai Ing-wen (蔡英文), party heavyweights expressed their support for Chen’s “humanitarian right to health,” praised his release as a first step toward political reconciliation, and extended their best wishes to the former president. Tsai said that a politician’s legacy would be assessed by the people and history.

KMT spokesperson Charles Chen (陳以信) said the party respected the Ministry of Justice’s decision based on professional medical and legal opinions, but urged the DPP not to “politicize” the release for a smear campaign against the KMT.

IMPLICATIONS: Several political observers were concerned about potential internal divisions at the DPP if Chen asserted his political influence, while others suspected the former president’s health condition would allow him to regularly engage in political activities. However, Storm Media, an online news website, reported that Chen, who rejoined the DPP last year, is trying to help his son. It is widely believed that Chen Chih-chung is interested rejoining the party and in running in the next legislative election as a DPP candidate.



KMT LAWMAKERS URGE ASSETS SOLUTION: More than 10 KMT lawmakers urged chairman-to-be New Taipei Mayor Eric Chu (朱立倫) to deal with the party assets issue and get closure on the matter as soon as possible because it has been a decade-long burden for them in election campaigns. Chu said on Monday that all illegal party assets should be returned and that the KMT would utilize its “legal assets” to nurture young party members.

KMT MEMBER SUES MA: George Wang (王可富), lawyer and former legal consultant to Ma’s father, Ma Ho-ling (馬鶴凌), on Wednesday filed a lawsuit against 13 senior KMT officials — including President Ma — accusing them of breach of trust and embezzling NT$200 billion (US$6.3 billion) in party assets.

KMT BLOCKS PARTY ASSETS BILL: While Chu pledged to deal with the party assets, the KMT caucus blocked a draft “statute on the disposition of assets improperly obtained by political parties (不當黨產處理條例)” in the Procedure Committee at the Legislative Yuan on Monday. The DPP said the move demonstrated the KMT’s “two-handed strategy” and “insincerity” on the issue.

An article penned by a journalist who specializes on the issue pointed out why all the KMT’s party assets, which the author estimates are worth NT$80 billion, are all illegal.



MA’S DONATION CONTROVERSY, PART II: Former Presidential Office deputy secretary-general Lo Chih-chiang (羅智強) said that while he had met with the Wei (魏) family — the founders of Ting Hsin International Group (頂新國際集團) — on four different occasions, he rejected reports that the meetings involved shady negotiations or donations.

Lo, who political pundit Clara Chou (周玉蔻) accused of acting in the Presidential Office as a “guardian angel” for Ting Hsin — the food giant at the center of a major food safety scandal for — said on Tuesday that he had met with members of the family four times in 2013.

Chou has accused President Ma of receiving off-the-book donations from Ting Hsin. Ma has subsequently filed criminal and civil lawsuits against her.

MINISTER OF TRANSPORTATION RESIGNS: Minister of Transportation and Communication Yeh Kuan-shih (葉匡時) resigned on Wednesday after a financial restructuring plan at Taiwan High Speed Rail Corp (THSRC, 台灣高鐵) failed to secure the bipartisan support it needed to be approved by the legislature’s Transportation Committee. THSRC chairman Tony Fan (范志強) also resigned. The Bureau of High Speed Rail said last week that Jan. 8 was the government’s last chance to avoid the debt-ridden company going bankrupt, which if not prevented could take place in March or April. However, the committee decided to hold off on reviewing the plan, saying they were convinced that extending the high-speed rail operator’s concession period by 40 years would only benefit investors, not the public.

174 ELECTED OFFICIALS FACE VOTE-BUYING CHARGES: The Supreme Prosecutors’ Office said that prosecutors have filed charges against 174 elected officials, including 29 city and county councilors, eight township mayors and 130 borough and village wardens, and township councilors, as of Monday over vote-buying allegations in the Nov. 29 nine-in-one elections. If indicted, the 167 elected representatives would have their elected status nullified and the vacancies would be filled either by the candidate who garnered the second-highest number of votes or through a by-election. The most notable official in the group is Greater Tainan Council Speaker Lee Chuan-chiao (李全教) of the KMT.

SCANDALS AND FEUD IN GREATER TAINAN: Greater Tainan Council Speaker Lee Chuan-chiao and Greater Tainan Mayor William Lai (賴清德) are engaged in a battle over Lee’s alleged vote buying in both the city councilor election and the Dec. 25 council speaker elections. Lee is under investigation for both charges and Lai said he would not attend any city council session until the controversy is solved.

MIXED BY-ELECTIONS OUTLOOK FOR DPP, KMT: In a preview of the five legislative by-elections next month, the Chinese-language Liberty Times reported that the DPP is eyeing at least three of the five seats at stake — Chuang Ruei-hsiung (莊瑞雄) in Pingtung County, Huang Kuo-shu (黃國書) in Taichung and Wu Yi-chen (吳宜臻) in Miaoli County, saying it could even win all five as the party is engaging in a see-saw match with the KMT in Nantou County and Changhua County. However, the KMT is also optimistic about winning at least three constituencies — Taichung, Miaoli County and Nantou County.

FOREIGN AID QUESTIONED: The Ministry of Foreign Affairs refuted claims by academics in Australian media that Taiwanese aid to the Solomon Islands had gone into the hands of local parliamentarians.

POLL TO BE HELD TO RECALL LEGISLATOR: A recall referendum to decide the fate of KMT Legislator Alex Tsai (蔡正元) has been scheduled for Feb. 14, marking the first time since 1994 that the nation holds a recall vote.

DOLE CALLS FOR US SUPPORT OF TAIWAN: Former U.S. Senate majority leader and presidential candidate Bob Dole has urged U.S. Congress to increase pressure on the White House to help Taiwan build its own submarines.



MND PRIORITIZES ARMS PROCUREMENT ITEMS: In a report to the legislature, the Ministry of National Defense (MND) listed eight prioritized items in future U.S. arms procurement: Perry-class frigates, diesel-electric submarines, AAV7 amphibious assault vehicles, advanced data link systems, ship-based electronic warfare systems upgrades, Phalanx Close-In Weapon Systems, precision-guided munitions for F-16A/B aircraft, and aerial mines.

DEFENSE MINISTER STAYING FOR NOW: Defense Minister Yen Ming (嚴明) has withdrawn his resignation after President Ma urged him to stay on, the Chinese-language United Evening News reported. However, personnel changes among senior defense officials, including Chief of General Staff Admiral Kao Kuang-chi (高廣圻), Army Commander Yen Teh-fa (顏德發), deputy defense minister Chiu Kuo-cheng (邱國正) and Air Force Commander Liu Chen-wu (劉震武), are expected to be made before April.

EX-MINISTER BLASTS BLACK HAWK DECISION: Former minister of the interior Lee Hong-yuan (李鴻源) on Saturday lambasted the central government’s plan to dedicate 15 of the military’s 60 U.S.-made UH-60M Black Hawk helicopters to civilian emergency airborne services, calling the decision “ludicrous” and “misguided.”



TAIWAN EMPLOYS MOST OVERSEAS VIETNAMESE WORKERS: Taiwan last year employed more than 50 percent of all Vietnamese workers who left for overseas jobs, statistics compiled by Vietnamese labor authorities showed. According to the statistics, more than 60,000 Vietnamese nationals came to Taiwan to work last year, making up about 57 percent of the total Vietnamese workers who landed a job overseas for the whole year.


The Taiwan Insider is a weekly feature prepared by the Thinking Taiwan Foundation’s Chris Wang and staff members. Comments? Leads? You can reach us at editor@thinking-taiwan.com.

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