Written by Piin-Fen Kok.

As the Taiwan Relations Act (TRA) enters its 35th year, we continue to be reminded about why this law—and U.S. arms sales to Taiwan, in particular—remains a source of contention in U.S.-China relations. The latest reminder came in the form of China’s backlash against a bill passed by the U.S. House of Representatives that reaffirms U.S. commitment to the TRA and authorizes the sale of four frigates to Taiwan.

Beijing’s official position on Taiwan arms sales has been well-repeated: It opposes all U.S. arms sales to Taiwan and views these sales as an abrogation of China’s sovereignty. But a sharp reduction in such sales, along the lines of what Beijing is calling for, as opposed to a more gradual approach, would be destabilizing to the interests of China, the United States and Taiwan.

There currently exists a delicate balance on the Taiwan arms sales issue, created by a three-dimensional policy architecture. This policy architecture comprises the TRA, which states that the United States will provide Taiwan with defensive articles and services necessary for Taiwan’s self-defense; the U.S.’s Six Assurances to Taiwan, which states, among other things, that the United States would not set a date for the termination of arms sales to Taiwan and would not consult with China in advance about such arms sales decisions; and the U.S.-China Joint Communique of August 17, 1982, which signals the United States’ intent to gradually reduce arms sales to Taiwan over time (provided that China demonstrates a continued peaceful policy toward Taiwan).

While not an ideal status quo from the vantage point of any one side, it has at least generated relative stability among all three sides. A sudden disruption of this equilibrium could lead to unintended consequences.

For example, Taiwan, already increasingly concerned about its security, could feel compelled to increase its domestic defense production to compensate for the loss of articles and services traditionally provided by the United States. Its confidence—and thus willingness—in negotiating with the mainland could be reduced. And its leaders could feel greater internal political pressures to take drastic actions to stand up against the mainland. (As the recent student occupation of the Legislative Yuan shows, public sentiments toward the mainland could manifest themselves pretty strongly.)

The mainland could respond with retaliatory measures, including the ramping up of its military force posture across the Taiwan Strait. And the United States could be caught in the middle and potentially be forced to intervene in a cross-Strait conflict.

In managing differences over the Taiwan arms sales issue—and, concomitantly, China’s military posture toward Taiwan—an incremental approach within the constraints of the existing three-dimensional policy architecture would best serve the interests of the United States, mainland China and Taiwan. A policy report released by the EastWest Institute (EWI) proposes two sets of unilateral, voluntary actions that the U.S. and China can take in this regard.

The report recommends that the United States unilaterally and voluntarily calibrate its annual arms deliveries to Taiwan such that the total dollar amount of arms provided to Taiwan in any given year does not exceed the inflation-adjusted peak level of U.S. arms supplied in the 1979-1982 period, or $941 million (in 2012 dollars). This would bring the United States in compliance with a key stipulation in the 1982 Joint Communique. The United States could conceivably even increase its annual arms deliveries relative to recent years, since 2007, and still not exceed the $941 million mark.

The report also proposes that China unilaterally and voluntarily reduce one-fifth of its short-range ballistic missiles aimed at Taiwan and dismantle the underlying physical infrastructure supporting those missiles.

These two sets of actions will not dramatically change the cross-Strait balance of power, but they can be first steps toward reducing the tensions and feelings of threat among the three key stakeholders. These are politically feasible steps that all three sides could conceivably live with, simply because the alternatives could leave them worse off.

Piin-Fen Kok is director of the China, East Asia and United States program at the EastWest Institute.

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