AN OLD ALLY

The Republic of China has its faults like any other government; it certainly has some. It is the oldest ally the United States has in Asia. The French ended relations with it in 1964 in order to normalize relations with the People's Republic of China, and they have not benefited particularly from doing so. I once heard an informed talk by a French official, off the record, of course, and the only possible conclusion one could draw from his talk was that he regretted that France had recognized the People's Republic of China at the expense of Taiwan.

Japan has not benefited particularly from following the same course in 1972, and clearly the current Government of Japan does not want the United States to follow its example. This reminds one of Sam Houston's remark at the temperance meeting.

The United States has no obligation to normalize. We owe Peking nothing. It allied, after all, with the Soviet Union in 1949, then our bitterest adversary, and supported both the North Koreans and the North Vietnamese in their undeclared wars against the United States. The Shanghai Communique is not binding on the United States. The Carter administration has decided that the Vladivostok Communique is not binding on the United States as worked out by the Ford administration, and I fail to see why the Shanghai Communique is any more sacred than the Vladivostok Communique.

We have no interest in normalizing with the People's Republic of China at the expense of Republic of China. What will we gain if we have that that we have not got now? I can see nothing really except perhaps somewhat closer cultural relations with the People's Republic of China-a very meager gain.

What will happen if we do not normalize? Nothing that I can see. I entirely agree with Ray Cline, and we are by no means alone in this view, that Peking's dispute with Moscow goes far deeper than the question of whether or not its relations with the United States are normalized. In short, there is very little real pressure on the United States to normalize except for Peking's exhortations and other pressures of the United States own creation.

I would end by summarizing this way. The United States at the present time has a good and unique China policy, in my opinion: continuing de jure relations with the Republic of China on Taiwan and de facto relations with the People's Republic of China on the mainland. I see no reason to change this until and unless the two Chinas alter their relationship with each other, which I think in time will occur.

Thank you very much.

Mr. BEILENSON. Thank you, Professor.

Professor Chiu.

STATEMENT OF DR. HUNGDAH CHIU, PROFESSOR OF LAW, UNIVERSITY OF MARYLAND LAW SCHOOL

BIOGRAPHY

Mr. Hungdah Chiu received his Doctor of Juridical Science (S.J.D.) degree from Harvard Law School in 1965. He is now a Professor at the University of Maryland School of Law. Among his many publications are “China and the

Question of Taiwan: Documents and Analysis" (Praeger, 1973) and "People's China and International Law" (co-author) (2 vols., Princeton University Press, 1974). In 1976 he was awarded a certificate of merit by the American Society of International Law.

Mr. CHIU. Mr. Chairperson and members of the subcommittee, it is indeed a great honor to be invited here to testify before this distinguished committee. My paper will deal with the following questions concerning normalization; namely, (1) whether the 1972 Shanghai Communique, which is the basis of United States-People's Republic of China relations, does commit the United States to accept the People's Republic of China's three conditions for normalization of relations; (2) the legal status of Taiwan and an evaluation of the People's Republic of China's claim to Taiwan in the light of principles of modern international law and practice; (3) the impact of normalization on the Republic of China; and (4) possible options for the Republic of China on Taiwan in response to a U.S. move toward normalization of relations with the People's Republic of China.

I have prepared a 40-page paper setting forth in detail my analyses and conclusions, and now I present to you only a summary of my paper which will take about 10 to 12 minutes.

On the first question concerning the Shanghai Communique, since Dr. Cline and Professor Hinton have dealt with this question I have nothing more to say. I just want to say I entirely agree with their analysis. So I start with the second question.

On the question of the People's Republic of China's claim to Taiwan, some China experts have kept asking the United States to accept the People's Republic of China's claim to Taiwan without questioning whether the PRC has a valid claim toward the island in accordance with principles of modern international law.

TAIWAN SOVEREIGNTY

Although Taiwan was placed under the Republic of China's administration in 1945, technically its sovereignty problem was not solved until the 1951 San Francisco Peace Treaty and the 1952 Republic of China-Japanese Treaty in which Japan renounced "all rights, title, and claim to Taiwan." After the Japanese renunciation, legally the island became an "abandoned land" in international law so the Republic of China could convert its belligerent occupation into definite sovereignty over the island.

How about the People's Republic? The People's Republic has denounced both Japanese peace treaties as "illegal and void," so it cannot claim benefit from the Japanese renunciation of sovereignty over Taiwan as provided in those two treaties.

After the Japanese renunciation of its claim to Taiwan, the People's Republic of China could not acquire title over Taiwan through the international law principle of occupation because it did not have physical control over the island at that time. Nor could the People's Republic of China act through the Republic of China's occupation to claim title over Taiwan because the People's Republic considers the Republic of China as an "illegal group" or even "bandits."

In the Shanghai Communique, the United States only committed itself "not to challenge" the belief of "all Chinese" in one China. Any

one with an elementary knowledge of international law should know that "does not challenge" is not equivalent to accepting or recognizing the People's Republic's claim to the island.

Now let me turn to the impact of normalization on the Republic of China. Direct foreign investment and technological inflow are indispensable to the economic viability of Taiwan. Past experience indicates that foreign direct investments in Taiwan have apparently been very sensitive to political events. The rate of American investments in Taiwan dropped sharply in 1971 and 1972, most probably as a result of the Republic of China's international setbacks during those years and doubt about its future status.

The same thing happened with Japanese investments. Soon after Japan recognized the People's Republic of China and severed its diplomatic relations with the Republic of China, Japanese investments dropped sharply and never recovered to catch up with the earlier rate. Therefore, if the United States normalizes its relations with the People's Republic and at the same time severs its diplomatic and treaty relations with the Republic of China, economic development in the Republic of China would suffer a serious setback, thus causing serious social problems and ensuing political instability in Taiwan.

AN "UNOFFICIAL OFFICE"

Some China experts suggest that the United States should accept the three People's Republic's conditions but still maintain an "unofficial office" in Taiwan, coupled with continued arms sales, OPIC investment guarantee and Export-Import Bank loans. In addition, they also say that a unilateral presidential declaration to continue to defend Taiwan against outside attack should be issued after normalization. After a careful study of the proposal I believe that it is simply not workable for several reasons.

First, when the U.S. terminates diplomatic relations with the Republic of China. most of the remaining 23 states that continue to recognize the Republic of China would probably follow suit, thus weakening fundamentally the Republic of China's international

status.

Second, by maintaining only an "unofficial office" in Taiwan, the United States would at least tacitly be recognizing the People's Republic's territorial claim to Taiwan. Thus, in the future, if the People's Republic chose to interfere with the U.S. economic, trade, government loan, or arms sales relations with the Republic of China, the United States would be in a poor position to resist the People's Republic's interference. The China Airline case between Japan and Taiwan in 1973-74 is a vivid recent example.

Third, the Republic of China Government and people have no confidence in a Presidential declaration or a congressional resolution to replace the defense treaty. Most of them would view this as face saving measures or a trick to fool the American people, and that the Congress and the U.S. administration has no intention to honor such a commitment to defend Taiwan in case of a People's Republic's attack. Under such circumstances, domestic investors would at least take a wait and see attitude and there would certainly be some capital flight from Taiwan.

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FOREIGN INVESTMENT

Foreign investors, similarly, would be reluctant, at least for a considerable period of time, to invest in Taiwan. Also, some foreign capital in Taiwan may withdraw right after normalization. Therefore, normalization on the PRC's terms would have a severe damaging effect on the economy of the Republic of China with ensuing social unrest and political instability. If that happens, radical groups in Taiwan may rise into power and demand that the Government take drastic "secondary options" such as manufacturing nuclear weapons, declaring independence, or allowing the Soviet Union to use port or other military facilities in Taiwan, thus greatly disturbing the stability of East Asia.

The reason why I use the word "secondary" here is that none of these options would be a happy one for the Republic of China to choose. However, the Republic of China, nevertheless, may be compelled to take one or more of these options if the people of the Republic of China feel that the United States is in fact going to abandon them.

Some China experts argue that the internal difficulties of the People's Republic in the foreseeable future would prevent it from taking military attack against Taiwan. This view is questionable. For instance, despite the great difficulties of famine and economic dislocation as a result of Mao's "Great Leap Forward" in 1959-62, the People's Republic of China under the leadership of the so-called "moderate group" of Liu Shao-ch'i, Chou En-lai, and Teng Hsiao-p'ing nevertheless launched a surprise military attack against India in 1962.

Some China experts have argued that the People's Republic of China will never bargain away its principles but is flexible in making concrete arrangements to implement the principles. For that reason, they argue that in dealing with the People's Republic the United States has to accept the three People's Republic's conditions for normalization and then work out so-called "concrete arrangements" to preserve Taiwan's "security." After making extensive research on the People's Republic's foreign policy, I can hardly agree with the above theory. To say that the People's Republic has always taken an uncompromising stand on its so-called principles in international relations is certainly not true.

I have given several examples in my paper to explain this point. In my view, the People's Republic's so-called principles become immutable only when the other side believes them to be so. If the other side is patient, then there is a good chance to persuade the People's Republic to change its alleged immutable position.

The assertion that the People's Republic is willing to be flexible in working out concrete arrangements in implementing principles is similarly not true. As a matter of fact, by accepting the People's Republic's so-called principles one has already been placed in an unfavorable position in dealing with the People's Republic. The People's Republic can reopen the issue at any time on the ground that a particular act taken under the concrete arrangements is in violation of the agreed principles, thus putting the other side in a defensive position.

Moreover, the People's Republic's explicit or implicit consent to a given concrete arrangement does not mean it has abandoned its goal. In the People's Republic's view such a consent merely postpones the

ultimate total solution and leaves the issue to be reopened at an appropriate time to be chosen by the People's Republic.

In conclusion, I believe that in dealing with the People's Republic of China on normalization the United States side should not always be on the defensive but should take an offensive approach by informing the People's Republic that under no circumstances would the U.S. compromise its fundamental principles of respect for human rights and self-determination. Moreover, the United States should realize that the present relations with the People's Republic are nothing but a marriage of convenience. The ultimate goal of the People's Republic of China's national objective remains the ultimate elimination of the so-called American imperialism.

Thank you, Mr. Chairperson.

[Mr. Chiu's prepared statement follows:]

PREPARED STATEMENT OF HUNGDAH CHIU, PROFESSOR OF LAW, UNIVERSITY OF

MARYLAND LAW SCHOOL

1. INTRODUCTION

This paper discusses some practical and legal problems concerning Taiwan in connection with the U.S. government's move toward normalization of relations with the People's Republic of China (PRC). Despite the existence of a voluminous literature on the question of normalization, some important problems concerning Taiwan have not yet been adequately explored, namely: (1) Whether the 1972 Shanghai Communique, which is the basis of U.S.-PRC relations, does commit the U.S. to accept the PRC's three conditions for normalization of relations; (2) The legal status of Taiwan and an evaluation of the PRC's claim to Taiwan in the light of principles of modern international law and practice; (3) The impact of normalization on the Republic of China (ROC); and (4) Possible options for the ROC on Taiwan in response to a U.S. move toward normalization of relations with the PRC.

2. THE SHANGHAI COMMUNIQUE AND THE PRO'S THREE CONDITIONS FOR ESTABLISHING DIPLOMATIC RELATIONS

On February 27, 1972, when President Nixon concluded his visit to the PRC, a joint communique was issued at Shanghai in which both countries, while still disagreeing on many issues, stated that "progress toward the normalization of relations between China and the United States is in the interests of all countries." Since then, some China specialists in the U.S. have been arguing for speedy normalization of U.S. relations with the PRC under the latter's three conditions, namely, that the U.S. abrogate its security treaty with the ROC, remove all troops from Taiwan, and sever diplomatic relations with the ROC. These specialists have even argued that in the Shanghai Communique the U.S. has already pledged to take these steps. The validity of such an interpretation of the Communique appears to be questionable.

So far as the relations between the ROC and the U.S. are concerned, the Shanghai Communique is a document of both clarity and ambiguity: clarity, because the PRC and U.S. both maintain that all U.S. forces should ultimately be withdrawn from Taiwan; ambiguity, because the two sides have not agreed on how the Taiwan question should be settled. The PRC insists that the "liberation of Taiwan is China's internal affairs in which no other country has the right to interfere." On the other hand, the U.S. "affirms its interest in a peaceful settlement of the Taiwan question by the Chinese themselves." These statements are both silent as to the U.S.-ROC security treaty and as to the U.S.-ROC diplomatic relations.

President Nixon explained the U.S. position before he went to the PRC as follows:

"In my address announcing my trip to Peking, and since then, I have emphasized that our new dialogue with the PRC would not be at the expense of friends. * * * with the Republic of China, we shall maintain our friendship,