U.S. Department of State
Background Notes:  Taiwan, November 1995
Bureau of Public Affairs

November 1995
Name: Taiwan 
 
PROFILE 
 
Geography 
 
Area: 14,000 sq. mi.; about the size of West Virginia. 
Cities: Capital--Taipei (pop. 2.6 mil-lion). Other cities--Kaohsiung 
(1.4 mil-lion), Taichung (832,654). 
Terrain: Largely mountainous. 
Climate: Maritime subtropical. 
 
People 
 
Population (1994): 21 million. 
Annual growth rate: 0.9%. 
Languages: Mandarin Chinese (official), Taiwanese, Hakka. 
Education: Years compulsory--nine; Attendance--99.9%. Literacy (1994)--
95%. 
Health: Infant mortality rate--0.5%.  Life expectancy (1994)--male 72 
yrs.; female 78 yrs. 
Work force: 9.2 million. 
 
Political Establishment 
 
Type: Multi-party democracy.  With the direct presidential elections 
scheduled for 1996, Taiwan will complete its transition from a one-
party, authoritarian state to an open, vigorous democracy with three 
major parties and more than 70 registered parties. 
Constitution: December 25, 1947. 
Branches: Five Yuan--Executive, Legislative (parliament), Judicial, 
Control, Examination. Separate National Assembly has certain powers 
regarding appointment, impeachment, and constitutional amendment but has 
no general legislative functions. 
Administrative subdivisions: Taiwan Province, Fujian Province (for 
Kinmen and Matsu islands), Taipei and Kaohsiung Special Municipalities. 
Major political parties: Chinese Nationalist Party (Kuomintang or KMT); 
Democratic Progressive Party (DPP); Chinese New Party (CNP). 
Suffrage: Universal over 20 years of age. 
 
Economy 
 
GDP (1994): $244.2 billion. 
Annual growth rate (1994): 6.5%. 
Per capita GDP (1994): $11,600. 
Natural resources: Small deposits of coal, natural gas, limestone, 
marble, and asbestos. 
Agriculture (3.6% of GDP): Major products--pork, rice, betel nut, sugar 
cane, poultry, shrimp, eel. 
Industry (37.4% of GDP): Major sectors--electronics and computer 
products, chemicals and petrochemicals, basic metals, textiles, 
transport items, plastics, machinery. 
Trade (1994): Exports--$93 billion: electronics and computer products, 
textile products, basic metals, plastic and rubber products.  Major 
markets--U.S. 26%, Hong Kong (including indirect trade with the P.R.C.) 
23%, Japan 11%.  Imports--$85.4 billion: electronics and computer 
products machinery and electrical products, chemicals, iron and steel, 
transport equipment, crude oil.  Major suppliers--Japan 29%, U.S. 21%, 
Europe 19%. 
 
THE U.S. AND TAIWAN 
 
On January 1, 1979, the United States changed its diplomatic recognition 
from Taipei to Beijing.  In the United States-People's Republic of China 
Joint Communique that announced the change, the United States recognized 
the Government of the People's Republic of China (P.R.C.) as the sole 
legal government of China and acknowledged the Chinese position that 
there is but one China, and Taiwan is part of China.  The Joint 
Communique also stated that within this context, the people of the 
United States will maintain cultural, commercial, and other unofficial 
relations with the people of Taiwan.

On April 10, 1979, President Carter signed into law the Taiwan Relations 
Act (TRA), which created domestic legal authority for the conduct of 
unofficial relations with Taiwan.  U.S. commercial and cultural 
interaction with the people of Taiwan is facilitated through the 
American Institute in Taiwan (AIT), a nongovernmental entity.  The 
Institute has its headquarters in the Washington, DC, area and field 
offices in Taipei and Kaohsiung.  It is authorized to accept visa and 
passport applications and to provide assistance to U.S. citizens in 
Taiwan.  A counterpart organization, the Taipei Economic and Cultural 
Representative Office (TECRO), has been created by Taiwan.  It has its 
headquarters in Taipei and field offices in Washington, DC, 11 other 
U.S. cities, and Guam.

Following derecognition, the United States terminated its Mutual Defense 
Treaty with Taiwan but has continued the sale of defensive military 
equipment to Taiwan in keeping both with the Taiwan Relations Act and 
with the 1982 U.S.-P.R.C. Joint Communique. The Taiwan Relations Act 
requires the United States to "make available to Taiwan such defense 
articles and defense services in such quantity as may be necessary to 
enable Taiwan to maintain a sufficient self-defense capability." In the 
1982 Communique, the United States stated that "it does not seek to 
carry out a long-term policy of arms sales to Taiwan;" that U.S. arms 
sales would "not exceed, either in qualitative or in quantitative terms, 
the level of those supplied in recent years;" and that the U.S. intends 
"gradually to reduce its sale of arms to Taiwan."  The P.R.C., in the 
1982 communique, reiterated its policy of striving for a peaceful 
solution to the Taiwan question.

Maintaining diplomatic relations with the P.R.C. has been recognized to 
be in the long-term interest of the United States by six consecutive 
administrations; however, maintaining strong, unofficial relations with 
Taiwan is also in the U.S. interest.  The United States is committed to 
these efforts because they are important for America's global position 
and for peace and stability in Asia. 
 
Trade and Investment 
 
Over four decades, Taiwan transformed itself from an underdeveloped, 
agricultural island to an economic power that is a leading producer of 
high-technology goods.  Taiwan has moved from being a recipient of U.S. 
aid in the 1950s and early 1960s to an aid donor and major foreign 
investor, especially in Asia.

U.S. commercial ties with Taiwan have been maintained and expanded since 
derecognition.  Taiwan continues to enjoy Export-Import Bank financing, 
Overseas Private Investment Corporation guarantees, most-favored-nation 
(MFN) status, and ready access to U.S. markets.

In recent years, U.S. economic dealings with Taiwan have focused on 
expanded market access for American goods and services.  AIT has been 
engaged in a series of trade negotiations which have focused on 
protection of intellectual property rights, and issues relating to 
Taiwan's accession to the World Trade Organization (WTO), as well as 
other market access issues.  Taiwan's bid to join the WTO and its desire 
to become an Asia-Pacific "regional operations center" are spurring 
economic liberalization moves.  In 1991 Taiwan, under the name "Chinese 
Taipei," became a member of the Asia-Pacific Economic Cooperation (APEC) 
forum, of which the U.S. is also a member.

The United States is Taiwan's largest trading partner, taking 26% of 
Taiwan's exports and supplying 21% of its imports.  Taiwan is the U.S.' 
seventh-largest trading partner and seventh-largest export market.  In 
1994, Taiwan's two-way trade with the U.S. was about $43 billion.  
Imports from the U.S. consisted mostly of agricultural and industrial 
raw materials.  Exports to the U.S. were mainly electronics and consumer 
goods.  Electronics is Taiwan's most important industrial export sector 
and is the largest recipient of U.S. investment.

As Taiwan's income level has risen, demand for imported, high-quality 
consumer goods has increased.  In recent years, Taiwan has successfully 
diversified its trade markets, cutting its share of exports to the U.S. 
from 49% in 1984 to 26% in 1994.  Taiwan's 1994 total trade surplus with 
the United States was some $9 billion, a significant amount, but a 
decline from a high of $17 billion in 1987.  Taiwan's dependence on the 
U.S. market should continue to decrease as its exports to Southeast Asia 
and the P.R.C. grow and its efforts to develop European markets produce 
results. 
 
ADMINISTRATION 
 
In December 1949--and following a civil war between the Communists and 
the ruling Nationalists--the P.R.C. was founded on the mainland by the 
victorious communists.  Chiang Kai-shek--the leader of the Nationalist 
Chinese regime--fled to the island of Taiwan, which the Nationalists 
already administered, and established a "provisional" capital in Taipei.

From 1949 until 1991, the authorities on Taiwan claimed to be the sole 
legitimate government of all of China, including the mainland.  In 
keeping with that claim, when the Nationalists fled to Taiwan in 1949, 
they re-established the full array of central political bodies they had 
originally established on the mainland.  Taiwan Province and, later, the 
Special Municipalities of Taipei and Kaohsiung were local bodies 
governed separately from the central administration.  While this 
structure remains largely the same, the authorities on Taiwan have 
abandoned the claim of governing mainland China, stating that they do 
not "dispute the fact that the P.R.C. controls mainland China."

The authorities in Taipei exercise control over the islands of Taiwan, 
Kinmen, Matsu, and the Penghu Islands (Pescadores).  Taiwan's two major 
cities, Taipei and Kaohsiung, are administered as provincial-level 
municipalities.  The rest of Taiwan and the Penghu Islands are 
administered together as the Province of Taiwan.  Kinmen and Matsu are 
administered by Taiwan authorities but they are considered in principle 
to be part of the mainland province of Fujian. 

National Assembly.  Under the constitution adopted by the KMT in 1947, 
the sovereignty of the people was to be exercised by the National 
Assembly.  The first National Assembly was elected on the mainland in 
1947 and was re-established on Taiwan when the KMT fled mainland China. 
The second National Assembly, elected in 1991, is composed of 325 
members serving four-year terms.

The National Assembly's main functions prior to August 1994 were to 
elect the president and vice president and to amend the constitution. 
Amendments passed by the National Assembly in July 1994 paved the way 
for direct election of the president and vice president; Taiwan's first 
presidential election is scheduled for March 1996. The National 
Assembly's powers now are to amend the constitution, recall the 
president, impeach the president, and ratify certain presidential 
appointments in other branches of the government.

President.  The president is leader of Taiwan and commander-in-chief of 
its armed forces. With the consent of the Legislative Yuan, the 
president appoints the premier, who is the head of the Executive Yuan.

Executive Yuan.  The Executive Yuan is roughly analogous to the U.S. 
executive branch of government in that it constitutes the cabinet and is 
responsible for policy and administration.

Legislative Yuan.  The main lawmaking body is the Legislative Yuan (LY).  
It dates from the late 1940's and originally was viewed as a "rubber 
stamp" institution. The LY has greatly enhanced its standing in relation 
to the executive branch and has established itself as an important 
player on the central level.

The LY elected in 1992 has 161 members serving three-year terms, all of 
whom are up for election in December 1995.  The LY has begun to reflect 
the recently liberalized political system; in the 1992 elections, the 
main opposition party--the Democratic Progressive Party (DPP)--
challenged the KMT monopoly on control of the legislature. In 1994, the 
LY passed legislation to allow for the direct election of certain local 
officials.

Control Yuan.  The Control Yuan monitors the efficiency of the public 
service and investigates instances of corruption.  The 29 Control Yuan 
members are appointed by the president and approved by the National 
Assembly, and they serve six-year terms.  Recently, the Control Yuan has 
become more activist and has conducted several major investigations and 
impeachments.

Judicial Yuan.  The Judicial Yuan administers Taiwan's court system.  It 
includes a 17-member Council of Grand Justices that interprets the 
constitution.  Grand justices are appointed by the president--with the 
consent of the National Assembly--to nine-year terms.

Examination Yuan.  The Examination Yuan functions as a civil service 
commission.

Military.  Taiwan maintains a large military establishment.  Its primary 
mission is defense of Taiwan, predominately from the P.R.C., which has 
refused to renounce the use of force against Taiwan should Taiwan 
declare independence or in case of involvement by a foreign military 
power. 
 
Principal Leaders 
 
President--Lee Teng-hui 
Vice President--Li Yuan-Zu 
Premier--Lien Chan 
Vice-Premier--Hsu Li-teh 
 
POLITICAL CONDITIONS 
 
Lee Teng-hui succeeded Chiang Ching-kuo as President when Chiang died on 
January 13, 1988.  Lee was elected by the National Assembly to a six-
year term in 1990, marking the final time a president was elected by the 
National Assembly.  As noted, starting in 1996, the president and vice 
president will be directly elected to four-year terms by Taiwan's 
voters.

This change in the political process is the result of the liberalizing 
trend that began in the late 1980s when President Chiang Ching-kuo 
lifted the emergency decree which had been in place since 1948.  This 
decree had granted virtually unlimited powers to the president for use 
in the anti-communist campaign, and it provided the basis for nearly 
four decades of martial law.  Until martial law was ended in 1987, 
individuals and groups expressing dissenting views were treated harshly.

Since ending martial law, Taiwan has dramatically improved respect for 
human rights and has worked to create a democratic political system. 
Restrictions on the press have greatly diminished, restrictions on 
personal freedoms have been relaxed, and the prohibition against 
organizing new political parties has been lifted.

Taiwan's political system has been dominated by the KMT; until 1986, the 
party's chairman was also Taiwan's president. Many top political 
officials are members of the party's Central Standing Committee, which 
is the chief policy-making organ within the party. As the ruling party, 
the KMT has been able to fill appointed positions with its members and 
maintain control of the island.

Since 1986, emerging political parties have challenged the KMT's 
dominance. Before then, candidates opposing the KMT ran in elections as 
independents or "nonpartisans."  Many "nonpartisans" grouped together 
illegally to create Taiwan's first new political party in over four 
decades, the DPP.  Despite the official ban on forming new political 
parties, Taiwan authorities did not prohibit the DPP from operating. In 
1989, the DPP and other new political parties were legalized, and the 
DPP's support and influence increased.

The DPP's voice has been an important factor in legislative decisions 
since 1992, and winning the Taipei mayoral election in December 1994 
significantly enhanced the DPP's image. Its platform includes outspoken 
positions on some of the most sensitive issues in Taiwan politics. The 
DPP maintains that Taiwan is an entity separate from mainland China, in 
contrast to the KMT position that Taiwan and the mainland are both part 
of "one China."  A number of ranking DPP officials, in sharp contrast to 
tenets of both KMT and P.R.C. policy, openly advocate independence for 
Taiwan.

The second major opposition party, the Chinese New Party (CNP) 
established in 1993, has a conservative platform. The CNP emphasizes 
"clean government" and the original KMT focus on reunification with the 
mainland.  Although CNP membership remains small, its influence is 
considerable, especially in its ability to draw support away from the 
KMT. 
 
REPRESENTATIVE OFFICES 
 
American Institute in Taiwan (AIT): 

AIT-Washington: Room 1700, 1700 North Moore Street, Arlington, VA 22209; 
tel. 703-525-8474; fax 703-841-1385.

AIT-Taipei: 7, Lane 134, Hsin Yi Road, Section 3 Taipei, Taiwan; tel. 
886-2-709-2000; fax 886-2-702-7675. 
 
Taipei Economic and Cultural Representative Office (TECRO): 

TECRO-Washington:  4201 Wisconsin Ave. NW, Washington, DC 20016-2137; 
tel. 202-895-1800; fax 202-363-0999.

TRAVEL AND BUSINESS INFORMATION

The U.S. Department of State's Consular Information Program provides 
Travel Warnings and Consular Information Sheets. Travel Warnings are 
issued when the State Department recommends that Americans avoid travel 
to a certain country. Consular Information Sheets exist for all 
countries and include information on immigration practices, currency 
regulations, health conditions, areas of instability, crime and 
security, political disturbances, and the addresses of the U.S. posts in 
the subject country. They can be obtained by telephone at (202) 647-5225 
or by fax at (202) 647-3000. To access the Consular Affairs Bulletin 
Board by computer, dial (202) 647-9225, via a modem with standard 
settings. Bureau of Consular Affairs' publications on obtaining 
passports and planning a safe trip aboard are available from the 
Superintendent of Documents, U.S. Government Printing Office, 
Washington, DC 20402, tel. (202) 783-3238. 
 
Emergency information concerning Americans traveling abroad may be 
obtained from the Office of Overseas Citizens Services at (202) 647-
5225.
 
Travelers can check the latest health information with the U.S. Centers 
for Disease Control and Prevention in Atlanta, Georgia. A hotline at 
(404) 332-4559 gives the most recent health advisories, immunization 
recommendations or requirements, and advice on food and drinking water 
safety for regions and countries. A booklet entitled Health Information 
for International Travel (HHS publication number CDC-94-8280, price 
$7.00) is available from the U.S. Government Printing Office, 
Washington, DC 20420, tel. (202) 512-1800. 
 
Information on travel conditions, visa requirements, currency and 
customs regulations, legal holidays, and other items of interest to 
travelers going to Taiwan also may be obtained before your departure 
from the relevant office in the U.S. (see "Representative Offices" 
listing in this publication). 
 
Upon their arrival in Taiwan, U.S. citizens are encouraged to register 
with the relevant office there (see "Representative Offices" listing in 
this publication). This may help family members contact you en route in 
case of an emergency.
 
Further Electronic Information:
 
Consular Affairs Bulletin Board (CABB). Available by modem, the CABB 
provides Consular Information Sheets, Travel Warnings, and helpful 
information for travelers. Access at (202) 647-9225 is free of charge to 
anyone with a personal computer, modem, telecommunications software, and 
a telephone line.
 
Department of State Foreign Affairs Network. Available on the Internet, 
DOSFAN provides timely, global access to official U.S. foreign policy 
information. Updated daily, DOSFAN includes Background Notes; Dispatch, 
the official weekly magazine of U.S. foreign policy; daily press 
briefings; directories of key officers of foreign service posts; etc. 
DOSFAN is accessible three ways on the Internet:
 
Gopher: dosfan.lib.uic.edu 
URL: gopher://dosfan.lib.uic.edu/ 
WWW: http://dosfan.lib.uic.edu/dosfan.html
 
U.S. Foreign Affairs on CD-ROM (USFAC). Published on a quarterly basis 
by the U.S. Department of State, USFAC archives information on the 
Department of State Foreign Affairs Network, and includes an array of 
official foreign policy information from 1990 to the present. Priced at 
$80 ($100 foreign), one-year subscriptions include four discs (MSDOS and 
Macintosh compatible) and are available from the Superintendent of 
Documents, U.S. Government Printing Office, P.O. Box 37194, Pittsburgh, 
PA 15250-7954. To order, call (202) 512-1800 or fax (202) 512-2250.
 
Federal Bulletin Board (BBS). A broad range of foreign policy 
information also is carried on the BBS, operated by the U.S. Government 
Printing Office (GPO). By modem, dial (202) 512-1387. For general BBS 
information, call (202) 512-1530.
 
National Trade Data Bank (NTDB). Operated by the U.S. Department of 
Commerce, the NTDB contains a wealth of trade-related information, 
including Country Commercial Guides. It is available on the Internet 
(gopher.stat-usa.gov) and on CD-ROM. Call the NTDB Help-Line at (202) 
482-1986 for more information.
 
==============================  
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Washington, DC  
  
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