Taipei, 21 July 1969
Secret
Instead of the customary valedictory despatch, I think it would be more appropriate in this instance if I were to let you have my views on my assignment to Taiwan in the form of a personal letter.
You will recall that the decision to establish an Embassy in Taipei in September 1966 was a fairly controversial one. I myself still have mixed feelings about the wisdom of the Government’s move at that time, and although in some respects the Post has not yielded the dividends we had hoped for, nevertheless I believe the decision to open an Embassy here can be justified, although in somewhat different terms to those used by your predecessor in Parliament at the time.
One of the inducements held out to us by the Chinese was that if we had an Embassy in Taipei we would have access to G.R.C. intelligence about developments in Mainland China. Experience has shown, however, that, for the most part, G.R.C. intelligence about Mainland China is so fragmentary, selective, and tendentious as to be of little real value. So much so, that our J.I.C. concluded last year that it did not want to receive any further material provided by G.R.C. intelligence sources. We nevertheless maintain informal contact with intelligence officials here, and although their information seldom adds any significant new facts to our existing China watching effort, occasionally they provide additional biographical material or useful comment on our own interpretation of events in Communist China.
[ matter omitted ]
I said earlier that the opening of a Post in Taipei can be justified on somewhat different grounds to those publicly stated by your predecessor at the time. In my view, the most valuable consequence of having an Embassy in Taipei is the opportunity it affords External Affairs officers of seeing how the G.R.C. operates, and of studying the Nationalists on their home ground. This is important, because hitherto virtually the only contacts that Australian Ministers and officials had with the G.R.C. since the Nationalist Government moved to Taiwan, were with ‘technocrats’ such as K.T. Li at international conferences, and with G.R.C. diplomats around the world. Any impressions gained and conclusions drawn from meeting and getting to know such people can be misleading if applied to the Nationalist regime as a whole. For the most part, G.R.C. diplomats are highly skilled in projecting a modest, low key, pragmatic posture which is well calculated to appeal to the average Australian’s sympathy for the underdog who, in this instance, has to live under the shadow of the Chinese colossus.
This modest image, however, is not one which is much in evidence in Taipei except in a material sense. The foreign observer here sees a rather different picture. It is one of an essentially militarist regime, in which corruption and inefficiency are still endemic, led by an old soldier who, with his ageing and trusty military advisers, is still dreaming of recovering the Mainland and leading the K.M.T. back to the promised land. It is, of course, easy to say that time will take care of all such illusions and that eventually the old guard will be replaced by the up-and-corning technocrats who will then be free to concentrate on making an economic success of Taiwan, and perhaps to dispense with at least some of the burden of maintaining over half a million men under arms as at present.
At this point, I think I differ from some of my Departmental colleagues in believing that, even in the post -Chiang Kai-shek era, the essential character of the Nationalist regime will not change. So long as the Nationalists control Taiwan (and I see no prospect of the Taiwanese ousting them or even being allowed a significant voice in the Government) the fiction that the G.R.C. is the Government of China will be fully preserved. Indeed, the Nationalists cannot even contemplate a two Chinas solution without calling in question the whole legal basis of their rule over Taiwan. Their legitimacy rests on their claim to be the legitimate Government of China. If that were abandoned, the Nationalists’ continued rule over Taiwan would be contrary to the spirit of the Cairo and Potsdam Declarations, which clearly laid down the intent of the Allied Powers to return Taiwan to China. If we now, or at some future time, say we (the Allied Powers) are not going to return Taiwan to China and if the Americans are prepared to patrol the Taiwan Straits in perpetuity, then presumably we can have our two Chinas at the price of the continued hostility of the other China. It has been suggested that it is not being wildly optimistic to expect that eventually Peking will relinquish its claim to Taiwan for the sake of improved relations with the United States. This is a view with which I do not think even the Nationalists (being Chinese themselves) would expect Peking to agree. It ignores the fundamental characteristics of the Chinese—their pride of race which at times degenerates into arrogance, their intense nationalism and their regard for the sacredness of Chinese territory, above all it ignores their obsession with preserving face especially where foreigners are concerned. These are the essence of the Chinese character and for us to accept the idea that in Peking’s eyes Taiwan is expendable is, to say the least, a most doubtful hypothesis upon which to base our present and future policy. I should have thought rather that our China policy should be based on the essential hypothesis that Taiwan is part of China (upon which the Communists and the Nationalists are agreed) and that we should be prepared to accept the prospect of an eventual accommodation between the two sides as a necessary precondition for any substantial improvement of relations between Peking and Washington. As I see it, an accommodation over Taiwan would remove one of the basic causes of tension in the area, and is probably an essential pre-requisite to a Far Eastern détente. Obviously no accommodation is possible with a Maoist regime, but President Chiang has not excluded the possibility of negotiating with a revisionist type regime. (He has even mentioned Liu Shao-chi by name.)
I am, of course, aware that traditionally our policy has been based on the assumption that a divided China is a weakened China and is therefore in our best interests. But we cannot consistently postulate as our ultimate goal an accommodation with Communist China whilst at the same time insisting on the one thing that renders any accommodation impossible—namely a separate status for Taiwan. The latter would make political sense only if it could be shown that it represented independence for the Taiwanese, but there is no evidence to suggest that the Nationalists are as yet sufficiently far sighted as to contemplate the sharing of political power with the Taiwanese. After twenty years of living together the gulf between the two communities remains wide and in Taiwan we have the unhealthy situation where a minority group dominates the political life of the country to the virtual exclusion of the majority from any voice in the Government.
The brighter side of the picture is, of course, the economic progress that the island has attained and the G.R.C. must be given due credit for what has been achieved in the economic field. Since the main features of Taiwan’s economic situation are, no doubt, well known to you, I shall not weary you by repeating them here. The subject has, incidentally, recently been reviewed by this Embassy in an article prepared for use in ‘Current Notes’ .1 All I want to say here on the subject of Taiwan’s economic achievement is that this could have been substantially greater but for the conservatism and inefficiency of the bureaucracy, which even today is still hampered by archaic methods of administration and banking.
Paradoxically, the biggest single factor militating against any significant liberalisation of the regime is the nature of the American commitment to Taiwan. Relatively secure under the American shield, the Nationalists see no present need to make any substantial changes in their domestic policies (although the Americans have, from time to time, succeeded in ameliorating some of the worst features of the regime). By the same token, the Nationalists can afford to adopt a much more belligerent attitude towards Communist China than any of their other neighbours in the area. If they felt a little less secure, perhaps they would not be so keen to drag us all into a war to recover the Mainland. This is the essential motive behind the G.R.C.’s efforts to promote an Asian collective security alliance, and since this point is not lost on such countries as Japan and Thailand, there is in my view no prospect of interesting such countries in an Asian alliance which included the R.O.C. as a member.
What then should Australia’s policy be in relation to the R.O.C? Despite the inconsistencies in our position, our China policy has so far served our interests pretty well. It is more flexible than American policy whilst being none the less firm in its resistance to Communist aggression. I believe that we should continue to maintain a low-key diplomatic posture in this country and that we should refrain from appearing actively to champion the R.O.C.’s cause, either in the United Nations or elsewhere. The R.O.C. has our vote, but we should resist any temptation to appear as their advocate or sponsor. The regime is not popular in Asia, and in my view Australia cannot afford to be too closely identified with it. It is at least conceivable that in a post-VietNam situation the United States might well tum its attention to the China problem, and the more open we can keep our options the better we shall be able to adjust to any significant shifts in American policy. Moreover, if the Canadian move towards Peking succeeds at the expense of our trade with Mainland China, the pressure on the Australian Government for a re-thinking of our China policy might be quite considerable.
Finally, may I say that despite its frustrations and domestic problems, my assignment to Taipei has been for me personally a very significant and enlightening experience. Knowing the volume of paper that passes across your desk, I have tried in this letter, at the risk of some over-simplification, to report to you as concisely as possible. However, you might like to know that I wrote to Sir Laurence McIntyre on 15th July on the subject of our China policy,2 and in that letter I endeavoured to refute what I regard as some misconceptions in the Department about Taiwan and the nature of the Nationalist regime.
[NAA: A1838, 519/3/1, x]
1 See Current Notes , vol. 40, 1969, pp. 365–72.
2 Document 132.