Editing 76-01-B4 (section)

=== Transcript ===
Back in 1972, former President Nixon signed a document called the Shanghai Communique with the late Chou en-Lai. It called for "continued normalization" of relations between the U. S. and the People's Republic of China, the Communist regime which has controlled China's mainland since 1949.

This opened the door for each government to establish an office in the other's capital city, And, it led to a flurry of trade which has since declined. But, there is still an opportunity for increased trade between our country and Peking. China has large oil reserves and U. S. technology could help develop them, for example. And, our relationship with the mainland of China can act as a deterrent to Soviet expansionism. As it is, the Soviets keep something like a million troops in the region of the Chinese border. So long as they are there they can't be used for adventures elsewhere.

The Peking government insists that there is only one China. On this, the Republic of China on Taiwan agrees, That is about the only thing the two governments agree on, Peking says that Taiwan is a province of China and that it rightfully should control the island. The ROC on Taiwan, on the other hand, still claims to be the legitimate government of all China.

It has a vigorous economy and is an important trading partner of the United States, about seven times more important right now than the mainland.

The carefully worded Shanghai Communique made it possible for the status quo to remain in effect indefinitely. But, a message of congratulations from President Ford to the new Peking premier, Hua Kuo-feng, this spring raised questions as to our government's intentions. The message referred to "completing" normalization of relations with Peking. By Peking's definition, this would mean dropping recognition of the ROC government on Taiwan, closing our embassy in Taipei and opening one in Peking. And, it would mean dropping our 22-year-old mutual defense treaty with the government on Taiwan.

Some in academic and U. S. diplomatic circles have been pressing for a so-called "Japanese formula" in the China matter. Japan withdrew its recognition of the Republic of China and gave it to Peking, but kept its important economic and trade ties with Taiwan. But, it had no mutual defense treaty, so the situation is not the same as ours. Taiwan represents the vital southern link in our western Pacific defense line. And, if we tore up our treaty, of what value would our word be to allies anywhere in the world?

Little by little, there has been talk lately of what might be called the "German formula". In the case of Germany, we acknowledge that there is one German nation, but two German states. This has permitted us to have diplomatic relations with both, realizing formally that the two would one day reunite, according to the will of the German people. Whether or not this approach to the China problem will prove to be the right one remains to be seen, but it is worth studying.

This is Ronald Reagan.

Thanks for listening. 

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