China's quasi-parliament, the National People's Congress, passed an "Anti-Secession" Law last week authorizing the Beijing government to take "non-peaceful measures" should Taiwan take any action that China chooses to define as "separatist."
Taiwan has been under the effective rule of China for only four years in the past century. The people of Taiwan increasingly consider themselves to be Taiwanese, not Chinese. A survey by the Election Study Center at National Chengchi University shows that the number of people who self-identify solely as Taiwanese has risen from 17.3 percent to 41.5 percent.
Over the past 30 years, Taiwan has become a successful, stable and prosperous democracy, and is Australia's seventh-largest trading partner. Australia's trade with Taiwan is worth some US$7 billion a year. Our China trade is worth US$28 billion.
Paradoxically, China and Taiwan have enjoyed increasingly close economic relations, while allowing the issue of Taiwan's status and its future to remain deliberately opaque. President Chen Shui-bian (陳水扁), despite his past support for independence, has not made any moves in that direction, and has pledged not to do so.
China has been both belligerent and conciliatory toward Taiwan, perhaps reflecting political differences within Beijing's communist leadership. But more worrying than its hot-and-cold rhetoric has been China's ominous arms build-up in recent years. Defense expenditures will reach US$38.1 billion this year, up by 12.6 percent from last year.
There is no doubt that Taiwan will fight to defend its freedom. Under the Taiwan Relations Act, the US will be obliged to come to Taiwan's defense. The ANZUS treaty makes Australia a military ally of the US, so the nightmare scenario is that Australia may be drawn into any such conflict.
China understands this, and feels increasingly confident about throwing its weight around, which is why a senior Chinese Foreign Ministry official warned Australia last week to be careful not to invoke the ANZUS alliance against China.
Australia should be using its best offices to see that situation does not deteriorate further. We should counsel our friends in Taiwan not to make any provocative moves, and to stick to Chen's "five noes" policy (no declaration of independence; no change of the country's name; no references in the Constitution to state-to-state relations; no referendum on Taiwan's status; no abolition of the National Reunification Council).
However, we should also make clear to China that the use of force against Taiwan is not acceptable.
Australia's interest clearly lies in the preservation of the careful ambiguity of the current situation. With the 2008 Olympics coming up, it's clear that China's interests lie in continued economic progress, domestic political reform and peaceful co-operation with all of its neighbors. Australia has good relations with China, and everyone in this country wants that to continue. Both major parties are considering supporting a free-trade agreement.
Australia's vastly expanded economic ties are just as important as the political links at federal and state government level, and among parliaments, unions and even local governments. These have grown exponentially in the past decade, and may have put Beijing under the misapprehension that what former Russian leader Leonid Brezhnev called "the correlation of forces" has moved in their direction.
However, if China is to embark on military conflict with Taiwan, I think we will see a change in mood not just in this country but in Europe and the US.
I am sure that is a situation that wise heads in Beijing do not want.
Michael Danby is a Labor Party lawmaker in Australia.
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