331. Memorandum From the Country Director for the Republic of China (Shoesmith) to the Assistant Secretary of State for East Asian and Pacific Affairs (Green)1

SUBJECT

  • Consequences of GRC Expulsion or Withdrawal from the UN—Weekend Reading

Outlined below is our assessment of the consequences of the loss of GRC representation in the United Nations on the political and economic stability of Taiwan, GRC relations with the United States, US policy toward the GRC and Taiwan, and GRC relations with third countries. We also have considered the impact on US–PRC relations.

We have tried to foresee the consequences under two different circumstances: (a) Although the GRC is willing to acquiesce in some compromise of its position as the sole representative of China in the UN [Page 596]and not to work against some form of alternate approach which might preserve a place for it in the UN, it is voted out through passage of an Albanian-type resolution or, (b) the GRC is unwilling to accept any compromise of its present position and either withdraws from the UN in the face of a proposed dual representation resolution or is voted out after actively working against passage of such a compromise resolution. In the case of withdrawal, we assume that the GRC’s action is clearly final and from the entire UN system. We also assume that under either circumstance, the GRC’s departure from the UN is followed closely by Peking’s entry. If this did not occur, we believe that some of the more adverse consequences might be softened or postponed.

Our conclusion is that the most significant consequences of GRC expulsion or withdrawal from the UN are likely to be in the areas of US–GRC relations, the viability of our own policy toward the GRC and Taiwan and the GRC’s bilateral relations with third states. The impact on internal political stability and on Taiwan’s economy seems likely to be less direct and more dependent on how the GRC responds to this situation. We also believe that these consequences are likely to be more serious in the event of a GRC refusal to acquiesce in some compromise and withdrawal from the UN than if it should be expelled despite a willingness to compromise.

I. Although willing to compromise, the GRC is expelled from the UN:

A.
Internal political stability would probably not be greatly affected under these circumstances.
(1)
Expulsion would be a blow to the GRC’s claim to legitimacy as the government of all of China in temporary exile on Taiwan. Such action by the UN could be interpreted as having stripped the GRC not only of any claim to be the government of China but also of any standing as a separate international entity. However, the present government’s effective rule over the island is not dependent primarily on its status as the caretaker of the 1947 Constitution. Its control is based on the monopoly of force and a well-organized internal security system together with a record of material progress, limited democracy, social order and reasonably efficient government administration. There is no organized opposition to the government on the island of Taiwan and little likelihood that one could develop quickly.
(2)
The GRC probably would seek to cushion the domestic impact of expulsion and would develop some form of self-justifying rationale for internal consumption.
(3)
Mainlander members of the government, military and party structure on Taiwan seem generally to have been pessimistic about the future of GRC representation in the UN. For them, expulsion from the [Page 597] UN would be more a confirmation of long-held fears than a cause for basic recalculation of national or personal goals.
(4)
Politically aware Taiwanese probably would welcome any discrediting of the present government while tending to be anxious about the possibility of internal repression if the GRC were no longer worried about its international image. A few Taiwanese leaders may be concerned for the possibility that expulsion of the GRC might prejudice the possibility of obtaining international recognition of Taiwan as an independent entity.
(5)
A significant minority of both mainlanders and Taiwanese probably would welcome the end of the annual struggle for the UN seat. Some mainlanders find this yearly test of the GRC’s credentials to be an undignified process for the GRC to suffer through. Some Taiwanese resent the expenses involved in UN dues, contributions to specialized agencies and the costs of GRC diplomatic efforts which are devoted mainly to Chirep.
(6)
In the final analysis, the domestic political consequences of expulsion will depend importantly on the government’s response. If, out of fear that this development might increase disaffection with or provoke an overt challenge to mainlander rule, the government tightens internal security and gives way to repressive measures, tensions might build to the flash point. This situation probably could be avoided, however, if the government avoided such a response and particularly if, after a face-saving interval, it gave some signs of willingness to accommodate Taiwanese desires for greater participation in the central government. We are uncertain how the GRC will respond, but are inclined to believe that it probably will avoid over-reaction.
B.
The effect of expulsion on the economy of Taiwan would probably be transitory, if the GRC is able to manage the internal political consequences without too much strain.
(1)
Although the investment climate is partially formed by subjective factors such as international political respectability, investors should over the long run continue to be attracted to Taiwan by low wages, official interest in attracting foreign capital and growing domestic technical and managerial experience. The immediate result of expulsion probably would be some slowdown in new investment to allow for assessment of the situation—including such elements as the degree of investment risk associated with any changes in US or Japanese policies toward the GRC or the effect of investment in Taiwan on future opportunities for trade with mainland China. The duration and severity of the slowdown would depend also on how well the GRC handles the internal political consequences of expulsion.
(2)
The Taiwan economy is heavily export-oriented. Since new investment (particularly American) is concentrated in production for [Page 598]export, the economy as a whole would probably feel the effects markedly of a slowdown in the input of foreign capital if it were severe and extended. Loss of UN representation per se, however, should not adversely affect Taiwan’s foreign trade patterns any more than in the case of the GRC’s loss of bilateral diplomatic relations where there has been no noticeable fall-off in trade with the individual countries involved.
(3)
Discontinuation of grant assistance from the UN Special Fund and technical assistance from UNDP would have minor drawbacks for the GRC, as would possible loss of membership in ECAFE. The relationship of the IMF and the IBRD to the UN is more indirect and their voting arrangements more favorable to the GRC. No Communist countries belong to either organization and there has been no pressure for PRC entry. On the other hand, ROK and the GVN are members of both IMF and the IBRD without being UN members.
C.
GRC relations with the United States might suffer new strains, the severity of which would depend upon the nature and extent of our efforts to prevent the GRC’s expulsion and our policy subsequent to GRC departure from the UN.
(1)
If, after having agreed in consultation with us to acquiesce in a compromise, the GRC should feel that we had not made a determined effort to win support for it within the UN and to block passage of an Albanian-type resolution by all means available, it probably would conclude that we had not dealt with the GRC in good faith and that our purpose had been to mask our willingness to have the PRC admitted at the price of GRC expulsion. This would place a severe strain on US– GRC relations. If, on the other hand, we had demonstrated clearly our determination to preserve a place for the GRC in the UN, such strain is likely to be minimal even if our efforts fail.
(2)
The GRC would probably press us after expulsion for renewed assurances of support, including reaffirmation of our defense commitment and provision of items of military equipment (submarines, F–4’s, tanks) as evidence of our continued close cooperation and support.
(3)
The Taiwanese Independence Movement in the United States probably would interpret expulsion from the UN as the beginning of the end for the GRC and might intensify efforts to unite Taiwanese overseas and publicize their cause. Our tolerance of their activities in the US would lead to increased tension in our relations with the GRC.
(4)
The GRC would be even more sensitive to our policies toward the PRC, and is likely to urge strongly that we take no further steps toward improving relations on the grounds that this would further undermine the GRC position internationally.
D.
US policy toward the GRC and Taiwan would face new challenges if the GRC were expelled from the UN. [Page 599]
(1)
Without the imprimatur of UN membership it would be more difficult for us to shore up the international position of the GRC since the PRC and other governments unfriendly to the GRC undoubtedly would insist that the UN action had stripped the GRC of any international standing. Even governments friendly to the GRC probably would confront rising pressures from public opinion no longer to cooperate with the US in seeking to support the GRC internationally.
(2)
The PRC also would argue that the denial of UN representation for the GRC in effect acknowledged that Taiwan is part of China and thus confirmed its claim to sovereignty over it. Within the UN, it probably would introduce resolutions condemning US interference in an internal matter and declaring our Mutual Defense Treaty to be an infringement on China’s territorial integrity and sovereignty. Even if we succeed in defeating such resolutions, the debate will focus critical attention not only on our treaty commitment but on our continued support for the GRC, and even close allies might find it politically difficult to come to our support. Within the US, the effect of such controversy may be to increase pressures for a change in our basic policies toward the GRC and Taiwan.
(3)
On the other hand, within the US GRC expulsion from the UN despite its willingness to acquiesce in a compromise solution might evoke some short-term sympathy for the GRC and opposition to PRC entry. This reaction probably would be strengthened if Peking were to trumpet the GRC’s expulsion as a victory over the US and to seek immediately to exploit the UN as a forum for attacks on our policies.
(4)
Over the longer term, however, the trend of international and US public opinion following the expulsion of the GRC probably will be in the direction of declining support for our present policies toward the GRC and Taiwan and increasing sentiment in favor of greater accommodation to PRC demands on this issue. This trend conceivably could lead to pressures for some change in our defense commitment and policy of continuing relations with and support for the GRC.
E.
GRC relations with third countries can be expected to erode further following expulsion.
(1)
The expulsion of the GRC from the UN probably would accelerate the erosion of its bilateral relations. Even governments such as Belgium, Australia and New Zealand which either are not now actively interested in establishing diplomatic relations with Peking or are unwilling to break with Taipei in order to do so would be under increasing internal pressures to recognize the PRC on its terms. Within several years following its expulsion, the GRC might be reduced to a position where it is recognized only by a handful of strongly anti-Communist countries (such as the Republic of Korea and South Vietnam) and, in [Page 600]addition to the US and Japan, a scattering of other countries in Africa and Latin America.
(2)
Having been willing to accept compromise in the UN, the GRC might succeed in slowing this trend if it made clear its willingness and desire to maintain diplomatic relations on the basis of its de facto position even with governments prepared to recognize Peking. Its ability to hold the line on this basis probably would be greater if the GRC also made clear its willingness to continue programs of technical assistance to and to participate in regional organizations even with countries recognizing Peking. It is possible, however, that having been expelled from the UN, the GRC might elect to contract its diplomatic efforts, turning inward to rely on the support of firm anti-Communist allies in East Asia, together with that of the US and Japan.
(3)
The position of Japan would be vitally important for the GRC. Japan’s major concern—that Taiwan not come under Chinese Communist control—would curtail its room for maneuver in changing its China policy even though domestic pressure probably would build for some new stance. The GOJ, however, would probably not move from its present position on the recognition of Communist China as long as there were no changes in the top LDP leadership, President Chiang were still alive and American policy on recognition did not change.
F.
US–PRC relations. The PRC can be expected to oppose strongly any compromise solution of the Chirep problem. It will be harshly critical of US support for such a solution and probably will interpret it as a plot to insure the permanent separation of Taiwan from the mainland, charging that the US intends to maintain Taiwan as a permanent military base. Since defeat of a compromise solution and expulsion of the GRC would be a major victory for Peking, it probably would be less willing to agree to any compromise on the Taiwan issue which we might advance in our efforts to clear the way for some improvement in US–PRC relations. Peking also would attempt to exploit this circumstance in an effort to increase domestic and international pressures for a major change in US policy toward Taiwan and the GRC by refusing to resume the Warsaw talks and rejecting all unilateral initiatives, thus heightening the appearance that the US is isolated on the question of relations with mainland China.

II. The GRC refuses to compromise and either withdraws or is voted out of the UN.

A.
The internal political consequences under this circumstance probably would not be much different from those in the case of expulsion as outlined above.
(1)
The fact that the GRC could insist that it had rejected any compromise of its claim to be the government of all of China and that the [Page 601] UN’s action was without legal effect in the absence of its agreement might have some stabilizing effect internally.
(2)
However, a sizeable minority of influential mainlanders and of the Taiwanese elite would feel that President Chiang and the more reactionary elements in the KMT and the government had deprived Taiwan unnecessarily of hard earned international recognition.
(3)
Supporters, on Taiwan and overseas, of Taiwanese separatism may see withdrawal under these conditions as a blow to their own hopes for the island, since the GRC will have thereby rejected a course that might have helped preserve Taiwan as an independent entity.
(4)
Refusal to compromise in the UN probably would signify the predominance of hard-line conservatives in GRC policy councils. A likely concomitant, therefore, would be a tightening of internal security controls. In combination with reduced confidence in the viability of the government following the loss of UN membership, this could increase domestic political tensions.
B.
The immediate economic consequences of GRC refusal to compromise and withdrawal from the UN might be somewhat greater than indicated in I/B above.
(1)
Foreign investors might assume that GRC refusal to compromise not only makes Taiwan’s future viability more uncertain but may make the climate on Taiwan less hospitable to the foreign investor. This assumption would be strengthened if, in the immediate aftermath of the GRC’s withdrawal, there were anti-American or anti-foreign demonstrations.
(2)
Taiwan’s trade relations might be damaged if, in an effort to discourage further erosion of its bilateral relations, the GRC were to threaten pressures, either in the form of boycotts or suspension of trade, with countries which may seriously consider recognition of Peking in the aftermath of GRC withdrawal from the UN.
C.
US–GRC relations would be strained if the GRC had urged strongly that we at least not support any compromise proposal but we had felt that it was in our best interests to do so. This would make more difficult continued cooperation subsequent to the GRC withdrawal.
(1)
It is possible that under these circumstances there would be violent anti-American demonstrations on Taiwan, condoned if not encouraged by the GRC, protesting the US “betrayal.” It would be in the GRC interest, however, to keep such demonstrations in check given its continued reliance on our defense commitment and political support.
(2)
Other consequences for US–GRC relations indicated in I/C (3) and (4) above probably would be aggravated in the event of GRC refusal to compromise and its withdrawal from the UN.
D.
US policy toward the GRC and Taiwan probably would be under greater pressure for change under these circumstances.
(1)
GRC refusal to compromise probably would evoke little sympathy in the US and considerable resentment and impatience with its position. Both in the press and Congress, there probably would be strong sentiment that Chiang had refused to be helped, that we had discharged our responsibilities to the GRC and that we now should be guided solely by our national interests in seeking an accommodation with the PRC.
(2)
The foregoing reaction would make our policy more vulnerable to such pressures as indicated in I/D (2) and (4) arising from PRC efforts to take advantage of the GRC withdrawal and the longer term trend of domestic and international opinion.
E.
GRC bilateral relations could be expected to erode even more rapidly in this circumstance than if it were expelled despite a willingness to compromise.
(1)
In this circumstance, it is unlikely that the GRC would become more flexible in defending its bilateral relations than its position in the UN. It is more likely that the GRC position would become more rigid, accompanied by less imaginative and more doctrinaire diplomatic efforts.
(2)
Public opinion in other countries probably would swing against the GRC even more rapidly than in the US thereby placing the governments, even in Japan, under strong pressures to recognize Peking even at the expense of breaking with Taipei.
(3)
If we had tried and failed to persuade the GRC to acquiesce in a compromise, our leverage in encouraging other governments to resist such pressures probably would be next to nothing.
F.
US–PRC relations. Peking’s initial reaction under this circumstance is not likely to be much different from that described in I/F above, particularly if it is clear that the US had sought to persuade the GRC to acquiesce in some dual representation compromise. Peking’s subsequent reaction would depend partly on our own. The PRC might, for instance, seek to exploit the strains in US–PRC relations and lowered sympathy for the GRC in the US and other countries by holding out to Taipei some offer of a “Chinese settlement” of the Taiwan problem. It is also possible that the PRC, despite its limited capabilities, might attempt to mount a clandestine campaign on Taiwan to stir up anti-US, anti-foreign sentiment, at the same time sapping confidence in the Chiang government.
  1. Source: National Archives, RG 59, Central Files 1970–73, UN 6 CHINAT. Secret. Drafted by Charles T. Sylvester and Shoesmith and cleared by William T. Breer and William A. Brown.