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DATE=3/19/2000 TYPE=BACKGROUND REPORT TITLE=TAIWAN ELECT - CHINA RESPONSE NUMBER=5-45679 BYLINE=STEPHANIE MANN DATELINE=BEIJING CONTENT= VOICED AT: INTRO: China's reaction to the presidential election results in Taiwan is being seen by many observers as low-key and measured. V-O-A Correspondent Stephanie Mann reports from the Chinese capital observers are struck as much by what China is not saying as what it has said. TEXT: Virtually all of China's main newspapers Sunday carried news about the election in Taiwan. Each of the papers seen in Beijing put a brief news report from the official Xinhua news agency in the lower right hand corner of the front page. The two-sentence article says the election for the leader of Taiwan was concluded and it lists the percentage of votes each candidate received. Each of the papers carries an accompanying article - also from the Xinhua news agency - that reports the joint comment issued late Saturday by the Taiwan affairs offices of the Chinese cabinet and the Communist Party. Analysts and observers are examining that statement closely to see how China's leaders feel about the election of opposition candidate Chen Shui-bian as Taiwan's new president. The party and government say they will watch what Mr. Chen says and does and where he leads Taiwan's relations with the mainland. The statement repeats Beijing's position that Taiwan is an inalienable part of China, adding that the election does not change that fact. Foreign observers point out the Chinese statement is noticeably less belligerent than official comments by Beijing in the days leading up to the election. The reaction statement makes no mention of the possible use of force, although it does say Taiwan independence in any form is absolutely impermissible. China has not changed its policy on Taiwan, which was outlined a few weeks ago in a lengthy White Paper. Beijing still reserves the right to use force if Taiwan declares independence, if foreign forces interfere in Taiwan's reuniting with the mainland, or if Taiwan's leaders indefinitely delay talks on reunification. But, by not repeating those threats, observers say leaders in Beijing apparently decided to put forward a more cautious, low key attitude as they wait to see how Mr. Chen acts in the coming days. China's official statement also says the "one-China" policy is the precondition for peaceful reunification of Taiwan and mainland China. And it says China is willing to exchange views on cross-Straits relations with all Taiwan political parties who approve of the "one-China" principle. Some observers interpret that as an olive-branch of sorts, because it does not carry the stipulation that reunification must be under the formula of one- country, two systems - the model that was used for Hong Kong and something China has said should apply to Taiwan as well. However, Chen Shui-bian has not said he embraces the idea of one China. Mr. Chen's Democratic Progressive Party was founded with the goal of independence for Taiwan. Mr. Chen has tried to distance himself from that idea, but foreign analysts say China's real reaction may depend on how far Mr. Chen is willing to move from his party's platform. Many ordinary Chinese are unaware of the Taiwan election and its potential impact. But many educated people in Beijing have expressed concern about the possibility that conflict might arise following the election of Chen Shui-bian, and they say they do not want a war. As China decides what action it may take, leaders in Beijing are likely to keep in mind the important economic relations across the Taiwan Straits. Taiwan businesses have invested an estimated 30 billion dollars on the mainland, and two-way indirect trade is substantial. Nonetheless, the issue of Taiwan's reunification has special significance in Beijing. Now that Hong Kong and Macao have both returned to Chinese rule, Taiwan is the last Chinese territory still not under Beijing's control. President Jiang Zemin is widely believed to want Taiwan's reunification with the mainland to be his legacy. That is not likely to be completed in three years' time, before his term as party leader expires in 2002 and his term as president runs out in 2003. But foreign observers say Mr. Jiang may hope the reunification process can be set in motion before he steps down. Most international news reports describe the Taiwan election as the first peaceful democratic transition of the presidency. Power has transferred from the Kuomintang Nationalist Party, which has ruled Taiwan for the last 50 years, to an opposition party which at one time was considered subversive. However, China has not publicly reported this aspect of the Taiwan election. China avoids the word president, saying instead Taiwan is choosing a new leader. Yet some foreign observers point out the parallel comparison is probably not lost on Chinese leaders. The Communist Party has also been in power for 50 years, but does not allow opposition political parties to contest in democratic elections. (Signed) NEB/SMN/ 19-Mar-2000 03:13 AM EDT (19-Mar-2000 0813 UTC) NNNN Source: Voice of America .