 So it's my great pleasure to introduce Professor Samuel Wu, Wu Xiu-guang, Wu Xiu-guang Yorong. And I'll say a little bit more about him in a minute. But just first of all on the subject, I'm glad we've got a reasonable turn up here because cross-strait relations are obviously hugely important. It goes without saying that for people who live in Taiwan, they're absolutely fundamental. It's an existential issue. But it's not much short of that for Australia too. Particularly people like me, I've had somewhat amphibious existence moving between a government and university, a Manian government, a bit more recent than university. When we think about what most determines Australia's strategic circumstances for better or for ill, for quite some time now it's been the state of relations between the people of the Republic of China and the United States. And in that Taiwan plays an absolutely crucial role. And we've had periods of considerable tension. We've had periods which have been somewhat more relaxed. But it's an issue that is certainly not going to go away, so continues to be of great importance. Of course, apart from the strategic and the economic interests that Australia has involved in that they're a broader moral and political and ethical issues as well. But I'll leave the subject quite properly to Professor Wu. But I said I was somewhat amphibious in terms of my career. But I'm amphibious, I'm at a loss for words to describe Professor Wu because he seems to have done absolutely everything. He's been involved in administration. He's been involved in real politics as Deputy Mayor of Taipei. He's been involved in scholarship. He's been a political scientist but also a politician. He's been involved in business and investment. There seem to be very few things that he hasn't done. And although this is his first visit to Canberra, as he's just confessed he has been to Australia on quite a few occasions before too. So he's no stranger to our shores. And I think he also understands therefore why this issue is of considerable importance to people in Australia as well as people in the wider world, most especially in Taiwan. So Professor Wu, I would like to invite you to come and make your presentation. The words have been carefully chosen. We discussed this last night, the perspectives of cross-strait relations and analytical framework and its implications. So that should give us plenty to go on with until 3 o'clock. We'll have the presentation and then depending on how much time we have we'll have Q&A. So Professor. Thank you. Thank you for the introduction. Thank you for everybody for coming. It's my greatest honor to be invited to this particular conference and to be the keynote speaker of this session. And I would like to take this opportunity to appreciate the Australian Center on China in the World and the Academia Kacinica, the Taipei Economic and Cultural Office in Australia and the Impengyuan Cultural and Educational Foundation for putting together all of these efforts and to put this conference together and inviting me here. The topic I would like to discuss about is the perspectives of cross-strait relations. And what I'm trying to do here is to provide an analytical framework and then discuss about the implication of that particular analytical framework. I have to admit that I'm no fortune teller, so I don't know what's going to happen one or two years from now between Taiwan and China. And neither I don't hold a governmental position now. So I don't have the necessary data that I need to fit into my analytical model to make a very precise prediction of what may happen in the future. So in this particular discussion, what I'm trying to do is just to provide an analytical framework and then try to apply the analytical framework and to use the limited data that I have and to have some gestures and to have some guess about what may happen. So there will be a lot of if and then or if and if and then. So that's what I'm going to report to you. So before that, I would like to also discuss a little bit about myself. Actually, now I'm not a full-time professor at the university anymore. I now serve as the chairperson of an international investment private equity fund. And then before that, I served as the deputy mayor of Taipei. And then before that, I actually taught at the National Change University. And before that, I actually had a chance to teach in the United States. I taught at the Texas A&M University and I also serve as an assistant researcher at the Hoover Institution, back to many years ago. And the funny thing about my change of jobs is that I found that in my current job, I actually concerned even more about the future. Because what happened in the future may have a tremendous influence on the future of my job. So I have to try to make it right. And that's exactly the reason why I try to come up with an analytical framework to help me to organize all the information that I gathered and try to make sense out of those information. So what's going to happen in the prospect relations in the years to come? We have to look back a little bit. The security environment in Asia actually has undergone major changes in the last few years and may face even greater change in the near future, I think. And the most relevant one to the prospect relations is the succession of power by Xi Jinping, China's new leader. After Xi took the new position as the president of PRC, he was able to consolidate his power almost immediately by taking the military shift job and also initiate major crackdown on those corrupt high rank officers at the same time. So apparently that he will be the one who is in charge for mainland China for the prospect relations for many years to come. However, we will see later in the framework that he is constrained by many structural factors. For example, he will certainly be constrained by China's domestic stability and the rise of nationalism in China. And the greater the instability and the rise of radical nationalism in China, the less room Xi Jinping will have to compromise with, for example, a pro-independent Taiwanese leader. Xi's decision may also interact with the decision by the United States leaders and the Taiwanese leaders. If Xi expects the much friendly relations with Taiwan due to a much compromising Taiwanese leaders in the future, for example, then he will be less likely to take assertive actions against Taiwan currently. So we are going to take a very dynamic view of what's going on in this period of time and what's going to influence to the next period of time. And on the contrary, if he expects very negative cross-strait relations in the future, then the chance for him to take a hostile action against Taiwan then is increased. And similarly, the possible change of national leadership in Taiwan in 2016 will also be a significant factor to the future of the cross-strait relations. If a new KMT leader is selected as the successor of President Ma, then it is more than likely that Ma's current reproachment policy will be continued. However, if a DTP leader is selected as president, for example, if Tsai Ing-wen was selected, then it will create great uncertainties to the future of the relations. The possible influence of the new DTP leaders to the cross-strait relations may not have to wait until the actual leadership change in 2016. Since the KMT has already lost the 9-in-1 local election in last year in such a dramatic way, the signaling effect of the events is strong enough for the Chinese leader to take some preventive actions. For example, mainland China may make stronger efforts to interact with selected DPP elites to push a new China policy from DPP and to pressure the current KMT government to reach further agreement so that the trend of reproachment becomes irreversible. So, then to what extent in my discussion, I will try to discuss the following questions. To what extent the cross-strait relations will be influenced by the transition of leadership in China and in Taiwan? And what will the leader be constrained? Will all these leaders be constrained by the already existed structural factors? He or she is more of a determinant factor to the future of the cross-strait relations. And what are those structural factors? And in what way those factors will shape the future of the cross-strait relations? And what are the strategies of the relevant leaders may do to best serve their respective interests? These are the questions I will try to discuss in this particular trend. But because of the limit of time, I will concentrate my last part of the analysis of what China may do according to this particular analytical framework. So, let's take a look of the analytical framework first. So, if we take a look of the literatures that discussed about the cross-strait relations, we're going to find that the literature will concentrate the discussion of all three categories of factors. The first category is the international system factors. I will explain what they are and what does it mean later. And the second one is the interactive factors between the two sides of the straits. And the third one is the linkage factor of the domestic politics to the cross-strait relations. It means that the linkage between domestic politics and the interactive decisions. And among all these three categories of factors, the most direct factors should be the interactions between the two governments leads by their respective local leaders. For example, the recent rapprochement between the two has been the direct result of the change of national leadership in Taiwan in 2008 when Ma took the office. And the expectation that things may get in better by the men in Chinese leadership is apparently a significant factor that convinced them to make economic concessions to Taiwan on the negotiation table in the last few years. However, the political leaders of both sides are constrained by the international system factors and their domestic politics. Men in Chinese leaders may want to take strong negative actions against a pro-independent Taiwanese leader. But if the United States is in support of Taiwan strongly, and then the China's move is constrained, and the relations among these factors may be illustrated in this particular figure. So let's take a look of this particular illustration. The factors actually can be summarized and operationalized as the following. If we take a look... Oh, sorry. Okay. The dependent variable we try to explain is the frustrate interactions. And I have to remind everybody that I try to make this particular analytical framework a dynamic one instead of a static one. So the interaction of the previous period may have a feedback effect to the model and then influence the next stage of the interactions. But what would be the frustrate interactions as a dependent variable? They are the direct result of the decisions by the Chinese leaders and the Taiwanese leaders. And I would like to operationalize their decision as the following. From the Chinese leader's side, I would say it's the level of assertiveness against Taiwan because we all know that China... The ultimate goal for China to push their frustrate relationship is to reunify with Taiwan. That's the ultimate goal. And then from Taiwan's part, I believe that Taiwan's decision can be operationalized as the level of independent against China. But these two decisions will have the most direct result to the frustrate interactions. But they are constrained by the two categories of variables. Let's take a look at the one in the above, the international factors. The international factors can be summarized and operationalized simply as the United States' support to Taiwan. Although a lot of other many countries' support to Taiwan are also important, but the most crucial one and the one that can be operationalized the most easily is the U.S. support to Taiwan. And then in turn, the U.S. support to Taiwan will be influenced by two factors, two variables. The first one is the power balance between U.S. and China. And the second one is the strategic interdependence between the United States and China. So, for example, the interactions of later two variables will determine the current form of the frustrate relations. And the current form of frustrate relations will signal to both political leaders what to expect in the future from their counterpart. And then many Chinese leaders will concentrate its concerns on whether Taiwan will get closer to Taiwan's goal of China's goal of reunification. And Taiwan's leaders will concentrate its concerns on whether China will become more democratized so that Taiwan will be less threatened by a stronger and wealthier China. Since we all notice that Taiwan seldom worry about a stronger United States or a stronger Japan. Why Taiwan would worry so much about a stronger China? I think it's because China is basically not a democratic regime. If China becomes a democratized regime just like Taiwan or United States or Japan, it will fit with Taiwan's leaders' concerns much better. So, let's take a look at the interactive factors. As mentioned above, the respective future expectation of Chinese leaders and Taiwanese leaders toward one another will have its important impact on their current decisions. If Chinese leader believes that the future frustrate relations is headling to the better, then he or she is less likely to take hostile actions now. Similarly, if Taiwanese leaders believe that China's political system will be more and more democratized, then therefore become more and more like that in the Taiwanese system, then he or she, the Taiwanese leader in the future, is less worried about Taiwan becoming too dependent on China. And a lot of scholars mentioned about this. However, if Chinese leaders believe that things are getting worse and then he or she is more likely to take hostile actions against Taiwan, especially if Chinese leaders believe that time is not on China's side, and if the longer they wait, the less likely that China will have the chance to move things back to the track. And then the Chinese leaders may be compelled to take strong preemptive actions in the current year. So that's the things that we have to pay attention to. And then let's take a look of the third categories of the factors, that's the domestic factors, and then think about how these domestic factors will link to the frustrate interactions. The Chinese leaders' decision is certainly constrained, just like we mentioned a little bit earlier, that China's domestic stability. And also it will be influenced by the China's development of nationalism in China. Scholars like Ma Wenong and Su Wen all mentioned about this. And then the Chinese leaders' perception of its military readiness against Taiwan is another important variable. The stronger the race of China's nationalism in domestic politics, the less room its leader has when confronting against perceived hostile actions against China, such as Taiwanese move toward independence. However, Chinese leaders' willingness to take assertive action against Taiwan is apparently conditioned by its perceived military balance and readiness against Taiwan. The China's domestic stability and also constrained and conditioned by China's domestic stability. The stronger the Taiwanese military balance in favor of China, then the more likely that Chinese leadership will take strong actions against Taiwan when the moment is needed. And then, so all these domestic factors then will all have impact on the leader's decision and then have an impact on the interaction. And the interaction of the current period will have an important influence on the next period of interactions. So that's how this particular model works. But we should take a closer look of the language politics itself. There is what we call two-level games and a loop of influence and interactions among the three major players here in the cross-strait relations, Taiwan, China, and the United States. Here, I try to use what we call the principal agent theories to help us to understand what's the interaction between the two collectives, the Taiwan and China. The Taiwanese leaders, I have to apologize that the direction of the error is wrong, but I'll explain them a little later. The Chinese political leaders is selected or authorized by the Taiwanese domestic mechanism, which is the democratic elections. So why, for example, President Ma can represent Taiwan to negotiate with China because he is elected as the president and he is authorized by the Taiwanese domestic mechanism. At the same time, Chinese political leader is also produced or authorized by the Chinese domestic mechanism. The two mechanisms may be different. The one in Taiwan may be much more democratic one. And the one in China may be much more authoritarian one. It will be a decision among a very small group of the central committee members. But no matter what, the leader is produced by a mechanism domestically. After he was elected as the leader, then he will be the agent for the collectives to negotiate with another political leader. But no matter what result come out of the negotiation between the two leaders, they will still have to bring back draft of the negotiation agreement back and for the ratification by their principles. So, for example, the service and the pact that agreement reached by China and Taiwan last year was still waiting for the ratification in the legislative yen in Taiwan. And so we see that even you come up with an outcome out of the negotiation, it's not the end of the story. You still have to bring back that particular tentative agreement for the ratification of your principles back home. And that's also the case in China. So in that case, later if I have time and if some of you among the audience would like to know a little bit more about the details of the two-level game analysis, I would try to illustrate that on the board. But at this point I think I'd better skip that part. But no matter what, among the factors mentioned above, some can be manipulated by political leaders and some are not. Among those factors that can be manipulated, political leaders would choose those most effective and efficient ones as priorities. So in this particular figure, for example, the Chinese leaders, when they try to influence Taiwanese leaders' decision, they may not have to deal with Taiwanese leaders directly. One possible way is to try to influence the Taiwanese domestic mechanism indirectly and then try to influence this part and then have an impact on the Taiwanese leaders' decision. And so that's the reason why we start to observe that a lot of Chinese leaders go to the southern part of Taiwan and try to make friends with a lot of DPP leaders and also make friends with a lot of the residents in the southern part of Taiwan. I think that's where their strategy tries to influence the Taiwanese domestic mechanism and then have an indirect influence on Taiwanese leaders' decision. And actually Taiwanese leaders can do the same thing, although it would be much more difficult for Taiwanese to do that. But one possible way of doing that is to try to, just like what Professor Schaub said yesterday, if we can make the level of democratization in China increased and then it will create a better environment for Taiwan in the future. So as demonstrated by this particular figure, the political leaders is the prospective agent of the collective body and he or she is authorized by the respective principles through the state's respective authorization mechanism. And after the authorization, such as an election elected as the president, the leader then is empowered to negotiate with its counterpart. However, if the tentative agreement can be reached between one leader and another one, and then the agreement will still require the ratification from the principles through each collective respective ratification mechanism. So for example, just like what I mentioned earlier, the trade and service pact agreed by the Hai Ji Hui and the Hai Xie Hui, the SES and the ARATS is still waiting for the ratification from the legislative union in Taiwan. And so therefore, to a political leader, there are several different ways to influence another political leader's decision. He or she is able to influence the other leaders by the direct interactions of negotiation. But he or she can also try to influence the other side by indirect interactions with the principles of the other side's authorization mechanism and through its relations with the third collective. So, after we understand all these factors, and from some of my previous analysis, I found that the interesting thing about the linkage politics is that sometimes the internal or domestic conflict may not be a bad thing. For example, when there is an argument inside of Taiwan about whether to what extent we should re-approach with China, the kind of argument inside of Taiwan may not be a bad thing for Taiwan because that would convince all the persuade Chinese leaders to give it more. In Taiwan, sometimes a lot of husbands will drink together and one negotiation that usually happens on the dinner table will try to convince another guy to drink more. But then if somebody asks me to drink more and if I can successfully convince him that I have a very strong wife and against me and not to allow me to drink too much, and if everybody believes that's true, and then I will have a better chance not to drink that much. So, the similar logic also applies here. So, when there is a very strong opposition inside of Taiwan, sometimes on the negotiation table between Taiwan and China, actually that may not be a bad thing. So, what's the implication after we understand these three categories of factors? And I would like to concentrate my discussion on what China may do according to the framework and the two-level gap. So, actually, again, I would discuss about what China may do according to the three categories of variables and to discuss about them from the three perspectives. So, in general, the new Chinese leaders may be able to influence the future relations according to the map of influence and interaction loops, just illustrated earlier, but still constrained by variables mentioned in the analytical framework. So, what Chinese leaders may do, first, let's take a look off the international aspect. I think the first thing that they may do is try to create a better strategic relations with the United States so as to reduce the U.S. support to a Taiwan. And we have already observed a lot of that. For example, the two leaders just reached quite a few strategic agreement on environmental protections and on many other things. And then the second thing that may happen is for the Chinese leaders to influence the United States, is to establish a stronger alliance with Russia to constrain the U.S. from its strategic maneuvers in Asia. And we also have already observed a lot of that. Not only when she took the office, he went to Russia to pay his first visit as the national leader. It's a very good sign of what he tried to do in this particular aspect. And then the third thing that he may do is to continue to strengthen China's military power to counterbalance the U.S. military presence in Asia and its possible intervention into the cross-strait conflict. So that's several things that China may do. And what China may do in the interactive aspect, one of the things that they may do is to structure a stronger framework for past 2016 cross-strait relations so that even with the change of the leadership from the KMT to the DPP, the current relations cannot be reversed. So they will try to push the things over to a particular threshold so that even with the change of leadership in Taiwan in 2016, things cannot be reversed. For example, to establish an institutional arrangement between the AR, the Hai Xie Hui and the Hai Ji Hui to have the institutional discussion and institutional arrangement between the two mechanisms. And the second thing that they may do is to initiate sensitive talks with Taiwan, such as the confidence-building mechanism and or even try to initiate political talks. And as we all know that actually by 1.5 track or even the second track of dialogue, the two sides try very hard to explore the possibilities. However, the chance for a very visible agreement to be reached in these two fronts is limited in the near future. The third one is try to have a breakthrough with Taiwan before the end of March 2nd term. Since March 2nd term, there are only about a little bit more than one year left. And I think especially after the defeat in the previous election, the chance for this to happen is also slim. But no matter what, a possible breakthrough is still, I believe, on Chinese leaders' agenda. And then what about the domestic aspect, both in Chinese domestic and in Taiwanese domestic aspect? I think the Chinese leaders may do is to establish a better connection with the new generation of leaders in KMT. Ma is on his way out and then the new generation of KMT leaders is coming in. And it is very important for the Chinese leader to connect and to build the new connections with those new generations of leaders in KMT. And at the same time, they also will try very hard to establish a better dialogue with the possible leaders in DPP. Actually, this has already happened. No matter as the local leaders such as Chen Jui and Lai Shizang of the Tainan city, they are also contacted by the Chinese leadership and try to build dialogue and try to build a better mutual understanding between them. And the first thing is to establish a stronger business, cultural and so on and so forth connections with various levels of Taiwanese society. And the fourth thing is to prepare to influence the result of the 2016 elections. Although they know this is very difficult but I still believe that they will try to do that. And one of the things that they may do is not to influence Taiwan directly but try to influence Taiwan's election through the United States. And so if they will be able to reach a better understanding about what the cross-strait relations should be with the United States and it is possible for them and try to convince the United States leaders to have an indirect influence on Taiwanese 2016 presidential elections. And the fifth one is to prevent its domestic race of nationalism from out of control. So these are a few things that the Chinese leaders will have in mind about both the Taiwanese and the Chinese domestic variables. The things that we will try to control and try to manipulate and try to influence. So if we go back to the previous line you are going to see that the China's actions can be actually demonstrated along the time in this particular illustration. So he will try to not only influence the leaders of the other side but also try to influence the domestic mechanism and try to influence who is going to be the next leaders. And he can also do this by influence the United States and have an indirect influence on China's domestic mechanism and then have an impact on who is going to be the next Taiwanese leaders and then have the impact on what interaction will be in the near future. So it's a very complicated loop of influence and interactions are illustrated here. Then if we have all this framework in mind then actually what we can do is to come back to you a little bit later. But this is going to be a very difficult table to read. But I'll explain a little bit what it is about. So actually what I did is to put all those three aspects of variables on the timeline. So the timeline is from 2013 all the way to 2017. And then along the timeline what you can do is to have all these three aspects of variables here. And then the... I cannot read so I have to read here. So for the first part is about the Taiwanese domestic factors and I operationalize all those factors as Taiwanese leaders' party position and Taiwan's dependence on China's economy and Taiwan's deterrence and defense power and so on and so forth. So then what I did is along the timeline I would put all those important events that represent the varies of those variables along this period of time. So for example the first one for example at the top of it is the DPP's former president candidate Frank Shea agreed with President Ma that the cross-strait relations is not international. The second one is that the DPP caucus called for the party to freeze independence charter of the DPP. All these are important events that represent a vary or a change in terms of the particular variables that mention in the analytical framework. Because as long as there is a variable if the variable doesn't vary then the variable will not have any influence on the dependent variables. So we have to find out when and in what way and to what extent that particular variable actually varies. So what I did is try to mark down all the events that would certainly happen in the future along that particular variables. And then I will put down those events that may happen or it's quite possible to happen in the near future. And then along the timeline and then you put all these three categories of variables together and put all the events according to the operationalization of those variables and then you will have these big tables. And then the funny thing is that it is not illustrated very properly here in this particular illustration in this table but on the computer or in front of a group of experts when we discuss about this event and try to come up with the predictions then this what we call a future events chart can be very, very helpful because we start to come up and down among all those different factors and then we start to have some kind of synergies of how those events might interact with each other or against each other and then what scenarios may develop out of a particular event and then how that particular scenario will be influenced by the later events that are surely to happen or quite possible to happen and then from that kind of exercise we will be able to come up with several different scenario analysis about what future may look like. So and one of the things that we pay particular attention to is what if 2016 the DDP leaders especially Miss Tsai Ing-wen was elected as the president of Taiwan what that particular trigger would trigger a series of events along the timeline. One of the scenarios that we came up is that Tsai Ing-wen after she was elected as the president he might have to do something to demonstrate that he's a little bit different from the previous president Mark he will act to demonstrate that he's a little bit more pro-independent than president Mark but however when the DPP government tried to do this she must in the expectation that this particular movement is not going to irritate China too much to the extent that Chinese leader is compelled to react in a very negative and assertive way. However what may happen along the scenario analysis exactly about that the same time China is going to have a very important national congress meetings and Xi Jinping is cracked down on domestic high-ranked officers and his political enemies will be in the highest peak at that time. So he is under the pressures not to give in in the across-strait relations and therefore he is compelled to react in a much more assertive way than Tsai Ing-wen would originally expected and then in that way then he will start to trigger a series of negative interactions between the two and then what will happen is that exactly during that period of time the military readiness in Taiwan is not in its best shape because in the early 2017 there will be a dramatic change in the military structures the military will change to a totally voluntary system and so for that part of time it will be probably one of the weakest point in terms of Taiwan's military readiness and then if you take a look of what the United States might do at that time it's also a political important moment in the United States because they are also facing the next round of the presidential elections and so this is one of the scenarios we should pay great attention to what I'm trying to say is that things may not go worse but if all these factors happen to turn to the words at that particular time then what I believe is that the mainland China my conclusion is that the mainland China's expectation that much hostile leaders may be selected by the Taiwanese voters in the 2016 and in the future may actually force Chinese leaders to compromise more with the current Taiwanese leaders so actually the ironic thing is that because the Chinese leader is expecting a worse situation in the future for example after the 2016 so actually for the next 12 months or something it may be ironically it may be a good chance for Taiwan to convince the Chinese leaders to give in more to compromise more on the negotiation table however the political linkage between the cross-strait relations and the respective domestic politics especially to the Taiwan's presidential election then can be a very powerful factor that will influence the future of the relations and if the previous scenarios that I just mentioned happened then although we will have much we will have windows of opportunities to now and the end of March 2nd term but after that there is a high possibility that China will pressure Taiwan in a major way if things turn to the worst and then at that time Taiwan will find itself less support by the United States and also from the military points of view it's less prepared and so although I don't believe that there will be a total military solution between Taiwan and China it is very very extremely unlikely for the Chinese leaders to go for the military solution against Taiwan because it's extremely difficult but I believe that for the first part of 2017 and even all the way up to the second part of 2017 Taiwan may have to confront a very difficult time economically, politically or even militarily and so if certainly this is just a warning and I hope that as long as we know that there is a cleat and then we will always be able to do something to avoid to fall down along into the cleats and as long as you manipulate things in the right way turn to the right turn and then things will be prevented and I think that's the main purpose for me and try to use this particular analytical framework and try to come up with a warning of what may happen after 2016 and I think I will tentatively stop here and see if there is any questions from the audience Thank you, thank you very much