Beijing-Taipei: Diminished Prospects Of Improved Relations

August 2004 | Market Strategy

There are signs that relations between China and Taiwan are once again on a downward trajectory, and this will in turn limit cross-Straits business ties, and potentially complicate Beijing's relations with the United States. China recently conducted a major military exercise simulating an invasion of the island state. Although an annual event, this year's manoeuvres focused on air superiority, a sphere in which Taiwan has for some years held an advantage. Days later, Taiwan itself conducted annual military exercises, which involved taking off and landing fighter aircraft on national highways for the first time in 26 years. Meanwhile, former Chinese

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