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STRATEGIC VISION Volume 3, Issue 13


February, 2014

for Taiwan Security w

ISSN 2227-3646

East China Sea ADIZ: Escalating Tensions Hon-min Yau

A Legal Perspective Michael Sheng-ti Gau

North Korea

and Ties With Taiwan Russell Hsiao & Sabrina Tsai Taipei’s Reliance on Middle Eastern Oil Serafettin Yilmaz

Loyalty & Identity

Transition to Professional Force Hampered by Ideology, Image Alex Calvo


for Taiwan Security

Volume 3, Issue 13


February, 2014

Contents Unleveraged Taipei-Pyongyang ties offer possibilities..................4

Russell Hsiao & Sabrina Tsai

China’s ADIZ escalates tensions in East China Sea......................10

Hon-min Yau

ADIZ not indefensible from legal perspective............................. 16

Michael Sheng-ti Gau

Transition to professional military hits snags..............................22

Alex Calvo

Middle East energy reliance leaves Taiwan vulnerable................29

Serafettin Yilmaz

Submissions: Essays submitted for publication are not to exceed 2,000 words in length, and should conform to the following basic format for each 1200-1600 word essay: 1. Synopsis, 100-200 words; 2. Background description, 100-200 words; 3. Analysis, 800-1,000 words; 4. Policy Recommendations, 200-300 words. Book reviews should not exceed 1,200 words in length. Notes should be formatted as endnotes and should be kept to a minimum. Authors are encouraged to submit essays and reviews as attachments to emails; Microsoft Word documents are preferred. For questions of style and usage, writers should consult the Chicago Manual of Style. Authors of unsolicited manuscripts are encouraged to consult with the executive editor at before formal submission via email. The views expressed in the articles are the personal views of the authors and do not necessarily represent the views of their affiliate institutions or of Strategic Vision. Manuscripts are subject to copyediting, both mechanical and substantive, as required and according to editorial guidelines. No major alterations may be made by an author once the type has been set. Arrangements for reprints should be made with the editor. Cover photograph by TC Lin.

Editor Fu-Kuo Liu Executive Editor Dean Karalekas Editorial Board Tiehlin Yen Raviprasad Narayanan Richard Hu Felix Wang Lipin Tien Laurence Lin STRATEGIC VISION For Taiwan Security (ISSN 2227-3646) Volume 3, Number 13, February, 2014, published under the auspices of the Center for Security Studies and National Defense University. All editorial correspondence should be mailed to the editor at STRATEGIC VISION, Center for Security Studies in Taiwan. No. 64, Wan Shou Road, Taipei City 11666, Taiwan, ROC. The editors are responsible for the selection and acceptance of articles; responsibility for opinions expressed and accuracy of facts in articles published rests solely with individual authors. The editors are not responsible for unsolicited manuscripts; unaccepted manuscripts will be returned if accompanied by a stamped, self-addressed return envelope. Photographs used in this publication are used courtesy of the photographers, or through a creative commons licence. All are attributed appropriately. Any inquiries please contact the Executive Editor directly via email at: Online issues and archives can be viewed at our website: © Copyright 2014 by the Center for Security Studies. Articles in this periodical do not necessarily represent the views of either the MCSS, NDU, or the editors.

From The Editor


nce again, we are very pleased to wish you, our readers, a happy Lunar new year. We are proud to be entering our third year of publication, and looking forward to continuing to bring you the very best in reporting and analysis of the security issues that impact Taiwan and the Asia-Pacific region. Last year, our first anniversary issue covered the US pivot to Asia: a topic that ran as an undercurrent through virtually every other security-related topic in the region in 2013. This year, as we begin 2014 with our second anniversary issue, our coverage includes China’s Air Defense Identification Zone (ADIZ) covering most of the East China Sea—a topic that likewise seems poised to dominate the security calculus of the region’s nations this year. In order to stimulate discussion on this complex issue, we offer two very divergent perspectives on this controversial topic. Lieutenant Colonel Hon-min Yau of the Air Command and Staff College takes stock of the response to China’s declaration of the ADIZ, and how tensions have become heightened as leaders worry about what Beijing might do next. Conversely, Professor Michael Sheng-ti Gau of National Taiwan Ocean University’s Institute of the Law of the Sea cuts through the rhetoric to examine the strict legality of China’s move and finds it consistent with international law. Russell Hsiao and Sabrina Tsai with the Project 2049 Institute take an eye-opening look at the heretofore discreet interconnections between Taiwan and North Korea and how they might properly be leveraged to not only help efforts to bring Pyongyang into the international system, but raise Taiwan’s international profile as a country dedicated to peacemaking in the East Asian region. We are very pleased to have an article by the head of the European University’s International Relations Department, Alex Calvo, who examines the ROC military’s difficulty in hitting recruitment targets, putting the plan to transition to a professional army in jeopardy, in light of the complicated relationship that national identity has with the feelings of loyalty and morale that are essential to any fighting force. We also are proud to congratulate our regular contributor, Serafettin Yilmaz, on being awarded his PhD. This month he provides an insightful analysis of Taiwan’s energy security. Once again, happy new year, and all the best for the Year of the Horse! Dr. Fu-Kuo Liu Editor Strategic Vision

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photo: Stephan North Korean flag bunting adorns a street in the capital city, Pyongyang. The reclusive state has long had largely unacknowledged ties with Taipei.

Strategic Vision vol. 3, no. 13 (February, 2014)

The Forgotten Link Taipei’s discreet ties with Pyongyang could aid in engaging reclusive regime Russell Hsiao & Sabrina Tsai


n mid-October of 2012, a high-level North Korean official made a not-so-secret visit to an island off the coast of Fujian province by way of Singapore (travel via Singapore is the preferred route taken by North Korean officials to Taiwan). Ostensibly to establish direct charter flights between Taiwan and North Korea in preparation for the pending tourist season (August was billed as tourism month by Pyongyang), the visit flew under the radar of most Western media outlets. The North

Tourism Bureau of the Democratic People’s Republic of Korea (DPRK), claimed he was visiting Taiwan at the invitation of local travel agencies to discuss ways to boost the reclusive North’s tourism industry. Jo’s most recent visit, and secret interactions between Taipei and Pyongyang over the past two decades, raise interesting questions about the history and actual current state of relations between the two countries. A spokesman for Taiwan’s Ministry of Foreign Affairs claimed that it had no prior knowledge of

Korean official Jo Sung Gyu, the deputy head of the

the North Korean official’s visit, insisting that it was

Russell Hsiao is a non-resident senior fellow at the Project 2049 Institute and national security fellow at the Foundation for Defense of Democracies. He is currently a J.D. candidate at The Catholic University of America, Columbus School of Law. . Sabrina Tsai is a research fellow at the Project 2049 Institute in Arlington, Virginia. She is also a master’s candidate at American University in Washington, D.C. She can be reached for comment at

Taipei-Pyongyang Ties  b  5

not official in any way. However, this was not the first time that a North Korean official—or Jo, for that matter—visited Taiwan; senior officials from the two countries have met on more than one occasion in the past. Jo’s visit, as well as other interesting meetings that were reported to have taken place in the past between Taipei and Pyongyang, particularly in the early 1990s, suggest a heretofore unexplored channel into the closed regime.

Hidden opportunity This blind spot throws into sharp relief the unleveraged aspects of Taiwan’s potential role in the international community’s efforts to engage with North Korea. Indeed, the island’s connection to the Peninsula has been overshadowed by China’s heavy footprint over the North, but this belies a hidden opportunity in the underlying tensions between Pyongyang and Beijing. As the international community tries to find new ways to respond to the ongoing challenges and pending crisis on the Korean peninsula, nontraditional leverages in Taiwan’s relations with North Korea may provide another unexplored gateway to unlocking the North. The level of contact between Pyongyang and Taipei is limited and often overshadowed by Beijing’s influence in

North Korea. Before Jo’s visit, another high-ranking North Korean official visited the island back in June of 2012. In hindsight, these visits highlight an anomaly in official interaction between the Republic of China (ROC) and North Korea. According to a report released by the Korea Trade-Investment Promotion Agency’s (KOTRA) Taiwan Trade Mission, Kim Jong Gi, the chairman of the DPRK’s Committee for the Promotion of International Trade, had a meeting at the Taiwan-Korea Business Association to discuss North Korean business and trade opportunities. Reports cited Kim as being the highest-level official from the DPRK ever to have visited Taiwan. It was reported that the purpose for his visit was to 1) attract investment from Taiwan for Hwanggumpyong Island and the Rason Special Economic Zone, and 2)


express gratitude toward the Buddhist Compassion Relief Tzu Chi Foundation, a powerful Taiwan-based international charity, for its continued assistance to North Korea. Tzu Chi has sent aid to North Korea nine times between 2001 and 2012. While official contact between Taipei and Pyongyang is limited, humanitarian aid organizations from Taiwan have been some of the most active in North Korea. The Tzu Chi foundation is a humanitarian organization with operations spanning the globe, as well as being the largest nongovernmental organization (NGO) in the Chinese-speaking world. It enjoys a special consultative status at the United Nations Economic and Social Council.

Gaining trust Between January 1998 and March 2000, the foundation sent aid—in the form of rice, canned food, powdered milk, fertilizer, farming equipment, winter clothes, and similar items—to North Korea seven

times. In the past, international humanitarian organizations were not allowed to enter the country to deliver relief items, but according to Tzu Chi, on its sixth relief mission, the DPRK government decided to respect its principle of direct aid and allowed 50 Tzu Chi volunteers to go to the countryside and personally distribute rice to over 40,000 families. More recently, in July 2013, the NGO received a request for help from the North Korean Council for the Promotion of International Trade, the same organization which cooperated with its distributions a decade ago. Tzu Chi sent two inspection teams to North Korea in August and October and started to plan for relief operations. China’s economic ties with the North are widely known, but Taiwanese companies also have a history with the DPRK. There are reportedly 100 Taiwanese companies involved in trade with North Korea through Chinese intermediaries, and five companies directly involved in North Korean trade. For the first time, in October 2013, six Taiwanese companies

photo: Robert Fluegel Members of the Tzu Chi Foundation distribute blankets and tarps in earthquake-ravaged Haiti. The Taiwan-based charity is very active in North Korea.

Taipei-Pyongyang Ties  b  7

photo: John Pavelka Docked on the Taedong River, the USS Pueblo is a captured US ship that now serves as a museum on North Korea’s propaganda-heavy official tour.

participated in the second DPRK-China Economic, Trade, Cultural and Tourism Expo in Dandong, Liaoling province at the invitation of Pyongyang authorities. To be sure, “The number of Taiwanese companies making inspection trips to North Korea is second only to the number of Chinese companies,” stated a source cited by Asahi Shimbun. Reports citing estimates extracted from customs data by the government-run trade promotion organization the Taiwan External Trade Development Council indicate that, in 2010, Taiwan and North Korea’s bilateral trade totaled US$21.27 million, which represented an increase of 2.3 percent from the previous year. Of total trade, Taiwanese exports reportedly accounted for US$13.41 million, whereas imports from the North were worth US$7.86 million, which represented an 11 percent increase from 2009. Clearly there is a level of legitimate trade between Taipei and Pyongyang, but one of the greatest concerns is the transfer of illicit materials. For example, sources point to Taipei-based Royal Team Corp.’s import-export arrangement with North Korea. According to journalist Bertil Lintner, Royal Team has exported questionable items of a dual-use na-

ture, including a refrigeration unit capable of handling temperatures of minus 70 degrees Celsius that could be applied to North Korea’s development of Weapons of Mass Destruction (WMD). A US govern-

“Taiwan serves as a critical transfer point for WMD-sensitive transfers, in which Taiwanese trading companies have been known to participate.” ment source cited by Defense News indicated that, due to US pressure on the ROC government, the Royal Team manager now operates out of Beijing.
 “It is easier to ship from Beijing than Taiwan. He also makes shipments from North Korea to Burma. The US pressured him to stop shipping some items to North Korea, but did not try to shut Royal down,” the source said. According to a report by journalist Wendell Minnick, another company of interest is Taichungbased Ching Hwee International Trading, which has been accused of selling machine tools to North Korea for making munitions. Due to pressure from


the United States in 2007, the company now ships machine tools to North Korea from China-based Shen Yang Machinery, the US source said. These two cases illustrate an important point: despite the lack of official relations between Taipei and Pyongyang, interactions are taking place and have probably been growing since 1992 as the economies of both China and Taiwan have liberalized.

Taiwan important actor Taiwan is essential to the global nonproliferation regime. In the words of Togzhan Kassenova, a member of the UN secretary general’s Advisory Board on Disarmament Matters, “Taiwan is too important an actor to leave outside of international efforts to prevent WMD proliferation.” Three reasons underscore Taiwan’s important role in the global nonproliferation regime. First, Taiwan stands as one of the world’s leading producers of dualuse, high-tech materials and technologies that can

benefit WMD programs. Second, as one of the world’s key transit and shipping hubs for international com-

“Gleaning ideas from the TaiwanChina rapprochement strategies, Seoul and Pyongyang can negotiate an official inter-Korean policy of nonpolitical cooperation first.” modities, Taiwan serves as a critical transfer point for WMD-sensitive transfers, in which Taiwanese trading companies have been known to participate. Third, Taiwan possesses nuclear power programs that rely on proliferation-sensitive materials and technologies. Lacking official status in the nonproliferation regime, Taiwan has unilaterally implemented policies and mobilized action congruent with global nonproliferation norms. Unlike China, Taiwan has been a compliant member—although not a signatory—to all initiatives stemming the capabilities of the North

photo: yeowatzup A corroded shipwreck near Lake Sijung. The North Korean economy is in a depressed condition and would likely benefit from increased ties with Taiwan.

Taipei-Pyongyang Ties  b  9

Korean regime to gain access to sensitive materials. In fact, Taiwan increased the number of banned export items from about 300 to 542 during 2006-2007. It has put in place a strategic trade-control system aimed at regulating dual-use goods and technologies related to the development of WMD programs. These efforts demonstrate Taiwan’s commitment to international norms and nonproliferation efforts, and indicate that Taiwan would play a constructive role if it were to be formally recognized and given membership rights and duties in the international nonproliferation regime. Not only is Taiwan indispensable to curbing the North’s illicit activities, cross-strait relations could also serve as a positive example for inter-Korean relations. The rapprochement between Taiwan and China since the inauguration of President Ma Ying-jeou in 2008 provides some lessons. The path to finding ways to cooperate is a long and difficult one, and the framework established by Taipei and Beijing—for better or worse—has provided a venue for political leaders on both sides to negotiate. Nonpolitical issues top the agendas as Beijing and Taipei look to cooperate on economic, transportation, environmental, and energy issues. Since Ma took office, 19 agreements have been signed, including the most recent cross-strait trade in services agreement.

Gleaning ideas from the Taiwan-China rapprochement strategies, Seoul and Pyongyang can negotiate an official inter-Korean policy of nonpolitical coop-

tion, energy issues, intellectual property, health, and a host of other topics), Seoul and Pyongyang can be put on a path to greater cooperation and increased peninsular stability. The Kaesong Industrial Complex, formed in 2002, is the most important cooperative channel between the North and South, and may be seen as a bellwether of relations between the two sides (some 53,000 North Koreans receive employment while more than 100 South Korean companies benefit from lower labor wages). However, for talks of expanding industrial cooperation between the two governments to proceed, an important first step toward building trust would require the North to commit to reasonable investment protection guarantees for South Korean companies in times of political turmoil (as demonstrated by the North’s abrupt five-month suspension of operations in 2013), while the South should ensure that labor wages are proper and operations meet basic human rights standards. In light of changing regional dynamics, TaiwanNorth Korea connections have an unexplored potential to leverage positive influence over North Korea. Reports indicate that Taiwanese individuals have been actively facilitating and participating in North Korea’s illicit channels of WMD-related materials. These events imply that the ROC government’s active role in the oversight of its local and overseas nationals can significantly help the international effort to freeze North Korea’s nuclear weapons program. Taiwan’s improved relationship with China is also an important new lever that could assist international efforts to unlocking North Korea. As the interna-

eration first, and then move on to tackling political issues later. This would largely align with South Korean President Park Geun-hye’s stated policy of trustpolitik, a moderate orientation that emphasizes the building of trust and reciprocity between North and South Korea. By approaching negotiable topics first (such as further negotiations on inter-Korean transporta-

tional community tries to find new ways to respond to the ongoing challenges and pending crisis on the Korean peninsula (an expectation further reinforced by Jang Sung Taek’s unexpected execution in late 2013), Taiwan’s hitherto unleveraged relations with North Korea may provide another gateway to move inter-Korean relations forward. n

Lead by example

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Strategic Vision vol. 3, no. 13 (February, 2014)

Stirring the Pot

China’s new Great Wall already causing storm clouds over the East China Sea Hon-min Yau


n Nov. 23, 2013, the People’s Republic of China (PRC) added fuel to the already burning fire over territorial and maritime disputes in North East Asia when it announced the unilateral establishment of an Air Defense Identification Zone (ADIZ) covering most of the East China Sea (ECS). Several countries with interests in the ECS were alarmed, including Taiwan, the United States, and Australia. Japan and South Korea discouraged their nation’s carriers from following China’s demands, which included the requirement that carriers submit flight plans to the Chinese authorities prior to sending aircraft through the zone, and once inside the demarcated area, that they maintain two-

way radio communication with PRC authorities and follow instructions, lest the People’s Liberation Army (PLA) adopt what Beijing terms “emergency defensive measures.” Of course, actions speak louder than words, and practical measures have already been implemented in response to the ADIZ. Just days after the proclamation, on November 25, 2013, the United States defied Beijing by dispatching a pair of B-52 bombers to fly over the disputed Diaoyu/Senkaku Islands, transiting the Chinese ADIZ, without informing the Chinese authorities. The new Chinese ADIZ not only encompasses the Diaoyu/Senkaku Islands—a move that has been in-

photo: Al Jazeera English Uotsuri is the largest island of the five in the Diaoyu/Senkaku chain. The disputed islands now fall under both the Japanese ADIZ and the new Chinese one.

Lieutenant Colonel Hon-min Yau is a military instructor at ROC National Defense University’s Air Command and Staff College. His military background is related to air defense, C4ISR, and information operations. He can be reached for comment at

Storm Over ADIZ  b  11

terpreted as a direct challenge to Tokyo— but it also extends to the airspace over Socotra Rock, which is claimed by both China and South Korea. Seoul had heretofore refrained from extending its own ADIZ over the submerged reef, known as Ieodo in Korea and Suyan in China. But Seoul did just that on December 8 when, in what was clearly a response to the unilateral move by China, it amended its air patrol zone—for the first time in 62 years—to cover Socotra Rock. Although South Korea controls the reef, and even maintains a maritime research facility there, it is claimed by China and Japan as well. Now, with the ADIZs of all three nations covering the rock, the risk of an inadvertent clash in East Asia is heightened thanks to the escalation that the Chinese set in motion.

map: Wikimedia Commons

This escalation continues apace: on December

Joint Strike Fighters over the next five years, acquiring three RQ-4 Global Hawk unmanned surveillance aircraft, and buying 17 V-22 Osprey tilt-rotor aircraft to boost the nation’s island-defense and amphibious capabilities. Why is China’s ADIZ in the ECS creating such a stir? Strictly speaking, an ADIZ is nothing more than a demarcated area of airspace that extends beyond a country’s borders in which all transiting aircraft are located and identified for the purpose of early warn-

20, 2013, the Japanese government approved new National Defense Program Guidelines and the MidTerm Defense Program, thus stepping up military spending in the years to come and focusing, among other things, on defense of the southern outlying islands and the military alliance with the United States. The plan includes the purchase of at least 28 F-35A

ing in the event of the approach of a possibly hostile aircraft. There are no treaties or international bodies that regulate the establishment or administration of ADIZs, nor are there any prohibiting them. The coverage of an ADIZ does not necessarily represent a country’s territorial airspace, nor does it speak to issues of sovereignty. Nevertheless, China’s inclusion

Continued escalation


photo: Myles Cullen A Chinese Su-27 Flanker fighter makes a fly by. Beijing has indicated it will take “emergency defensive measures” against aircraft violating its ADIZ rules.

of the Diaoyu/Senkaku Islands at the extreme south of the new ADIZ, as well as Socotra Rock at its extreme north, reveal the strong political motivations behind its establishment, and serve as a clear signal from Beijing to the region’s other powers: these belong to us.

Strict rules In addition to the placement of the ADIZ boundaries, the rules laid out by Beijing for aircraft transiting the zone are likewise a point of contention. The PRC requests that aircraft not only heading toward Chinese airspace, but those only skirting the zone over international waters, submit their flight plans to Beijing and comply with orders from the PLA. This goes beyond the requirements that the United States and other countries put on those traversing their ADIZs. Thus, it too is seen as a ploy by Beijing to obtain tacit approval that China rules the sea. The East China Sea ADIZ may well prove to be only the first of a series of such zones covering China’s

coastline and forming another Great Wall to keep the barbarians out. Writing for the Brookings Institution, Senior Research Fellow at Japan’s Institute for International Policy Studies Jun Osawa opined that this “Great Wall in the sky” is only the latest in a series of similar efforts, including Mao Zedong’s “Great Wall at Sea,” and the notorious “Great Firewall” restricting the Chinese people’s Internet access. Osawa

“Right after Beijing’s announcement ... the ROC National Security Council immediately issued a statement emphasizing that the government would defend its sovereignty over the Diaoyu/Senkaku Islands.” sees the ADIZ as aiding in China’s larger strategy of anti-access/area denial (A2/AD). The maritime disputes between China and Japan have intensified over the past year, with the conflicts in the area of the Diaoyu/Senkaku Islands increas-

Storm Over ADIZ  b  13

ingly involving each side displaying its show of force in the air, rather than just at sea. Numerous incidents of aerial interceptions between Chinese and Japanese aircraft have been reported in recent months. It seems clear that the ECS ADIZ is intended as another challenge to Japan’s claim of effective control and right of administration over these uninhabited rocks.

The Hainan Island Incident

tive, the UNCLOS provision that nations “shall comply with the laws and regulations adopted by the coastal State ... in so far as they are not incompatible with this Part” allows Beijing to restrict US military operations within its EEZ. This disagreement over the legality of EEZ overflights persists today, and the Chinese establishment of the ADIZ may well have been, at least in part, intended to prevent confusion and avoid future incidents like the Hainan Island Incident by setting up a strictly controlled buffer zone with clears rule of engagement. Unfortunately, it has clearly had the opposite effect, and the implications worry China’s neighbors. Taiwan’s ambiguous international status complicates its ability to clearly express its own position. Right after Beijing’s announcement of the ADIZ on November 23, 2013, the Republic of China (ROC) National Security Council immediately issued a state-

Beijing’s distress over encirclement is well-known, and it is particularly sensitive about US military flights through what it considers its airspace. This was brought to a head in April 2001 when a US Navy EP-3E ARIES II signals intelligence aircraft on a routine reconnaissance mission about 70 miles southeast of Hainan Island in the South China Sea was intercepted by two PLA Navy J-8II interceptor fighter jets. One of the jets collided with the US EP-3, killing the Chinese pilot and forcing the American aircraft to make an emergency landing on Hainan. The plane was dismantled and its crew detained and interrogated by the Chinese until the US government issued a statement, as well as a payment, that allowed both sides to end the diplomatic standoff with some degree of face intact. The incident stemmed from a divergence of opinion over freedom of navigation through China’s Exclusive Economic Zone (EEZ) and conflicting interpretations of the United Nations Convention on the Law of the Sea (UNCLOS), to which the PRC is a signatory and the US is not, although the US Navy largely adheres to the UNCLOS provisions regarding navigation. On the US side, Part V, Article 58 of the Convention states that all states enjoy the freedoms “of navigation and overflight” map: James Kim within EEZs. From the Chinese perspec-


ment emphasizing that the government would defend its sovereignty over the Diaoyu/Senkaku Islands and reiterating the tenets of the East China Sea Peace Initiative proposed by ROC President Ma Ying-jeou. In facing such a complicated situation—Taiwan is beholden to the United States for its security against Chinese designs on annexation, yet at the same time its economy is intertwined with that of the PRC— leaders in Taipei must continue to balance policy between the region’s major powers, namely the United States, Japan, and China.

Opportunity for cooperation Strategically speaking, China’s ADIZ in the ECS could prove to be a good opportunity for Taiwan to explore potential avenues for greater international cooperation. For example, after 17 years of fruitless negotiations, Taiwan and Japan finally concluded a fisheries agreement on April 10, 2013 covering fishing opera-

tions in the waters where the two countries’ EEZs overlap (essentially, the Diaoyu/Senkaku Islands). The two sides inked the pact in response to US pres-

“Taiwan must likewise develop a unique strategy of its own to provide countermeasures against China’s growing military might.” sure to do so. Anti-Japanese sentiment in China was at a fever pitch, and Washington was keen to try and reduce tensions in the area by any means necessary. Similarly, by harnessing Asian countries’ current discontent with China, ROC leaders can seize another opportunity to utilize Taiwan’s strategic location in the Asia-Pacific region to deepen economic and military cooperation with other countries, albeit behind the scenes. China is still the major threat to

photo: John Giles The detained EP-3 crew boards a chartered aircraft after being held for 11 days by the Chinese authorities following the 2001 Hainan Island Incident.

Storm Over ADIZ  b  15

photo: Sean Hackbarth ROC veterans march in a 2010 Memorial Day parade in the United States. The two countries have long shared strong military and security ties.

Taiwan, and as a result of Beijing’s growing international clout, Taiwan has been fighting for many years against a steadily shrinking area of international space. Taiwan’s unique geopolitical importance deserves to receive more international attention. At the same time, it is still in Taiwan’s best interests to maintain the stable and progressive development of the cross-strait relationship, while remaining aware of China’s intention of using the ECS ADIZ as another means of conducting political warfare. If the ROC government cannot clearly convey its position domestically and internationally, it will confuse the Taiwanese people and alienate its foreign friends. China is manipulating the issue of sovereignty over the Diaoyu/Senkaku Islands, and Taiwan understands—perhaps better than most—that when

region, Taiwan must likewise develop a unique strategy of its own to provide countermeasures against China’s growing military might. For a start, the US AirSea Battle concept can serve as a good reference for Taiwan. As reported by Jane’s Defense Weekly last month, the ROC Air Force unveiled its newly upgraded Ching-kuo Indigenous Defense Fighters (IDF/F-CK-1), which have the capability to carry an air-to-surface missile that is essentially Taiwan’s homegrown version of America’s AGM-154A Joint Standoff Weapon; the Wan Chien (or Ten Thousand Swords) cluster bomb. This is a good example of developing a cost-saving countermeasure for components of China’s A2/AD threat. The ROC faces multiple security problems, including difficulties transforming its military from a con-

dealing with China, there is no room for compromise on issues that impinge on sovereignty. Maintaining a delicate balance between sovereignty and exploiting common ground requires agile and multifaceted policies. On the security front, as China uses the ADIZ as another means of conducting its A2/AD strategy in the

script army to a professional, all-volunteer force, a rigid security environment along its perimeter, and a shrinking economy. Nevertheless, a continuous investment in Taiwan’s own defensive capabilities— especially smart spending—remains one of the indispensable components of ensuring the country’s long-term prosperity and continued democracy. n

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Strategic Vision vol. 3, no. 13 (February, 2014)

Legal Defense

From the perspective of international law, China justified in declaring ADIZ Michael Sheng-ti Gau


he Government of the People’s Republic of China (PRC) declared on November 23, 2013, the creation of an air defense identification zone (ADIZ) in the East China Sea (ECS). A map and coordinates were released to identify the outer limits of this ADIZ, which encloses the Diaoyu/ Senkaku Islands. According to this declaration, aircraft in the area must report their flight plans to PRC authorities, maintain two-way radio communication, and clearly mark their nationalities on the aircraft fuselage. These and other rules went into effect at 10 a.m. that very day. Beijing vowed to “adopt defensive emergency measures to respond to aircraft that do

not cooperate in the identification or refuse to follow the instructions.” The PRC’s ADIZ overlaps with the ADIZs established by the Republic of China (ROC) and by Japan in the 1950s. Spokesmen for the PRC government said that it did not rule out the possibility of establishing a similar zone in the South China Sea (SCS). The move has met with protests from the United States, Japan, South Korea, the Philippines, and Australia. Following suit, South Korea enlarged its own ADIZ in the ECS, effective December 15, 2013. Germany and France expressed their concerns over peace and security in the ECS. The Philippines condemned the

photo: Hymans Family Archives The signing of the 1944 Chicago Convention, which provides the obligation to respect the sovereignty that a state has over its national airspace.

Professor Michael Sheng-ti Gau graduated from Cambridge University, King’s College London and Leiden University, and teaches at the Institute of the Law of the Sea, National Taiwan Ocean University. He is the vice-chairman of the Aviation Safety Council in the Executive Yuan in Taiwan and can be reached for comment at

Legality of ADIZ  b  17

image: Alexandr Chechin Artist’s rendition of the Chengdu J-20, a fifth-generation stealth fighter aircraft expected to be operational in the People’s Liberation Army by 2017-2019.

PRC’s move, deeming it an attempt to turn the ECS into Chinese territorial waters. The ROC responded by stating that the move is not conducive to improving the cross-strait relationship, because Beijing did not consult Taipei in advance. The ROC urged the PRC not to create another ADIZ in the SCS. Is China’s ADIZ in the ECS an invasion of the national airspace and territorial sovereignty of other states? Is this ADIZ consistent with international law? Is it obligatory to consult with neighboring countries prior to such a move? What are the purposes of the move? How should Taiwan react? Most of these questions are best addressed by looking at the issue from a legal perspective.

upon State B’s national airspace. An ADIZ is a buffer zone to prevent other states from invading one’s national airspace. This makes an ADIZ something very different from an outright extension of national

“Some states are criticizing the PRC for using the ADIZ as an illegal delimitation of airspace. This is based on a misunderstanding of the legal nature of ADIZs.”

International law provides certain conditions to be met when a state creates an ADIZ. The ADIZ must

airspace. In fact, the Chicago Convention provides no legal basis for establishing an ADIZ. This does not mean that the creation of an ADIZ finds no support from international law, however. Rather, the legal grounds can be found in the concept of the inherent right to self-defense, which every state enjoys. It is embodied by Article 51 of the United Nations

not violate the customary international rule codified by Article 1 of the 1944 Chicago Convention on International Civil Aviation, which provides the universal obligation to respect the complete and exclusive sovereignty that a state has on the airspace over its land territory and territorial waters (i.e. national airspace). Hence, State A’s ADIZ shall not encroach

(UN) Charter, signed by the ROC itself when the UN was first established. No state loses this inherent right upon becoming a member of the UN and being bound by its charter. The first ADIZ was established by the United States in 1950. This precedent was soon followed by other states, including Canada, Japan, the ROC, South

Legal conditions


photo: Michele Misiano Technical Sergeant Al Perkins, a USAF avionics technician, checks an aircraft transponder with an IFF (Identification Friend or Foe) camera.

Korea, the Philippines, Vietnam, etc. It sounds contradictory for these states to oppose the same move taken by the PRC now.

Self-defensive limitations Of course, even the exercise of this inherent right to self-defense is not without limitations. There are two requirements that must be fulfilled when a state exercises its right to self-defense: namely, the conditions of necessity and proportionality. Article 3 bis of the Chicago Convention, which went into effect on October 1, 1998, provides that all states must abstain from using force against a civilian plane in flight. In case of interception, the lives of persons on board and the safety of aircraft must not be endangered. Such considerations are applicable to, and binding upon, the military aircraft that are dispatched to enforce the rules of an ADIZ. The United States is so far not among the 143 states (including China, Japan, and South Korea) that have ratified Article 3 bis of the Chicago Convention. Moreover, Articles 58 and 87 of the 1982 UN

Convention on the Law of the Sea (UNCLOS) provide that, when a coastal state expands its maritime jurisdiction by declaring its 200 nautical mile Exclusive Economic Zone (EEZ), it shall continue to respect the exercise of freedom of overflight which is part of the high seas freedoms, enjoyed by all other states.

“Looking at the practices of the PRC in enforcing its ADIZ in the ECS so far, PLA aircraft have only taken defensive measures, instead of launching offensive attacks.” Therefore, when enforcing an ADIZ which covers the airspace over an EEZ, military aircraft shall pay due regard to the foreign aircraft’s exercise of these freedoms. Applying the aforementioned rules of international law to China’s establishment of the ADIZ in the ECS and the enforcement by the People’s Liberation Army (PLA) aircraft for this purpose, so far the PRC has committed no violation of these rules. Some states are criticizing the PRC for using the

Legality of ADIZ  b  19

ADIZ as an illegal delimitation of airspace. This is by locating its ECS ADIZ in international and combased on a misunderstanding of the legal nature of mon airspace where non-hostile aircraft of all states ADIZs, which can be defined as partial jurisdiction continue to enjoy freedom of overflight. for limited purposes by a coastal state. As a buffer Most importantly, China has not demanded the zone, an ADIZ is meant to ensure national security right to approve or deny foreign aircraft seeking to fly and prevent a nation’s airspace from being invaded. through the ADIZ. Therefore, the criticism that the It follows that the ADIZ has to be established outside PRC is using the ADIZ to occupy the airspace of the national airspace. Other embodiments of the concept ECS is unfounded. Although China’s ADIZ overlaps can be seen in the two proclamations made by US the EEZs of South Korea and Japan, as well as that President Harry of the ROC, the Truman in 1945 PRC’s ADIZ does concerning the not entail any inexpansion of marterfering with the itime jurisdiction exercise of sovfor specific purereign rights and poses; by the poljurisdictions by lution control juthese neighboring risdiction exerpaties for the purcised by Canada pose of explorain the Arctic; and tion, exploitation, by the contiguous conservation, and zone regime and management of the concept of hot natural resourcpursuit as defined es in their EEZs. by UNCLOS. Not Therefore, China’s photo: Keith LaFaille being exclusive, move does not viIFF equipment allows interrogation systems to identify military and civilian aircraft. an ADIZ repreolate UNCLOS. sents no occupation of airspace over the high seas and China’s purpose in creating an ADIZ over the ECS EEZ. Thus, it is lawful for such non-exclusive ADIZs is to protect the integrity of Chinese territory and its created by different states to overlap and co-exist. national airspace. The spot in the ECS that is most Looking at the practices of the PRC in enforcing prone to foreign incursion is the airspace, as well as its ADIZ in the ECS so far, PLA aircraft have only territorial waters, surrounding the Diaoyu/Senkaku taken defensive measures, instead of launching ofIslands. It is necessary for Beijing to keep this area fensive attacks. They have taken action to identify under scrutiny so as to prevent a Japanese invasion, foreign aircraft inside the zone that have failed to as well as to evict Japanese forces after such an invamake notification to the Chinese authorities. These sion materializes. Unless the PLA Air Force (PLAAF) measures include scrambling fighters to perform a stops the US Air Force (USAF) and the Japan Air visual inspection of such aircraft while transiting Self-Defense Force (JASDF) from flying into the airthe zone. It would appear, therefore, that China is space surrounding the Diaoyu/Senkaku Islands, it complying with the established rules and practices seems hard to conclude that China’s establishment


photo: Michael Coghlan Beijing’s ADIZ rules, including that aircraft clearly mark their nationalities on the fuselage, went into effect on the day of the zone’s announcement.

of the ADIZ is aimed at occupying the islands. The real aim is rather to increase the PLA presence in the skies over the ECS, and thus act as a counterbalance to the USAF and JASDF. When balance is regained, a consensus among China, Japan, and the United States can be reached wherein none of the parties involved will move a muscle to take over the Diaoyu/Senkaku Islands by force.

Senkaku Islands. From a constitutional law perspective, the ROC has a legal obligation to protect the

“It is inconceivable that the ROC should be upset about such patriotism on the part of the PRC.”

How should Taiwan react to China’s ADIZ in the East China Sea? The PRC requests that Taiwan’s civilian aircraft file flight plans prior to flying though the zone. This has naturally caused a certain degree

territorial integrity of the same islands, consistent with its own claim over them. It follows that the ROC must not rule out the option of enlarging its own ADIZ to prepare for a time when such self-defense action is called for. How could the ROC government criticize Beijing for creating an ADIZ, then? As the territorial sovereignty claims of the ROC and PRC overlap completely, the actions

of inconvenience. What Taipei should consider is whether this inconvenience is justified or not. Under similar circumstances, would the ROC follow suit? It is not without good reason that the PRC set up the ADIZ—to prevent misjudgment toward civilian aircraft when resorting to defensive actions in guarding China’s territorial sovereignty over the Diaoyu/

taken by the PRC to defend the Diaoyu/Senkaku Islands against possible Japanese aggression—which the ROC might not dare to do—is also a patriotic imperative for the ROC, which claims sovereignty over all the territories of China. It is inconceivable that the ROC should be upset about such patriotism on the part of the PRC. Perhaps the reason is due to

Reaction from Taiwan

Legality of ADIZ  b  21

the PRC’s ADIZ also being adjacent to the ROCadministered islet of Pengjia. This shows that the PRC does not respect the status quo of the separate administration by the ROC and PRC of territories divided by the Taiwan Strait. As a matter of fact, Taiwan is not the target of China’s establishment of the ADIZ. Thus, the security concerns of Taiwan should not be affected in this regard.

Facing off with Japan The leaders in Beijing are perhaps convinced that Taiwan will not join China in taking action at that critical moment when the Diaoyu/Senkaku Islands are about to be lost to Japan, which has illegally nationalized the islands. There are several reasons for this, including the unlikelihood that the United States would allow Taiwan to use American-made weapons against Japan, as well as the fact that the ROC government advocates a peaceful resolution with Japan—

which grabs the former’s territory—as evidenced by ROC President Ma Ying-jeou’s proposed East China Sea Peace Initiative. Under such circumstances, the PRC will be left to defend the Diaoyu/Senkaku Islands alone. For this purpose, China has been compelled to create a buffer zone which draws close to the area under ROC administration. It is perhaps for this same reason that Beijing might feel justified in creating the ADIZ unilaterally, without ay prior—and useless—consultation with Taipei, Tokyo or Washington. As to the ROC government being upset about the PRC’s ADIZ in the ECS: it only makes itself more awkward when, openly, it does nothing concrete to protect its territorial integrity while the PRC government across the Taiwan Strait has done everything to defend the territories claimed by itself and the ROC. Is it the lack of prior consultation by PRC that is harming cross-strait relations, or is it the inaction on the part of Taipei? That is the question. n

photo: HoHo Lin The PRC’s ADIZ skirts the ROC-controlled Pengjia Islet, suggesting that Beijing does not respect the separate administration of ROC and PRC territories.

22  b 

Strategic Vision vol. 3, no. 13 (February, 2014)

Loyalty and Identity Transition to professional military falters for want of loyalty-based ideology Alex Calvo


ecurity and defense reporting in Taiwan over the last few months has been dominated by the troubles in moving to a fully professional military. The difficulties in hitting recruitment targets over the transition period have been compounded by the tragic death of Corporal Hung Chung-chiu. A number of observers have commented on the various reasons why a career in the military is not that

the relationship between national identity and the feelings of loyalty and morale that are required for an effective armed forces, and the ultimate issue of how best to guarantee the island's defense. If called upon to fight, what will Taiwan’s young military men be fighting for? Does the island’s diversity support or hinder the effectiveness of the armed forces? Can different national identities be compatible

attractive to today’s young Taiwanese. However, going beyond these matters, it is necessary to discuss

with a strong security posture? A positive answer to this last question may require the development of an

Alex Calvo is the head of the International Relations Department at European University (Barcelona Campus) and guest professor at Nagoya University. He can be reached for comment at All photos in this article were taken during the 2013 Han Kuang military exercise in Penghu by photographer TC Lin, a journalist, filmmaker and writer living in Taiwan. He can be reached at

Recruiting Woes  b  23

ideology informed by the concept of loyalty, rather than identity, as the only way to make democracy and national defense compatible. At the same time, the remaining four-month compulsory military service may be an opportunity to build a reserve force, increasing the efficiency of the island's defense and the capacity to deter aggression.

International trend The choice between a conscript army and a professional one is among the most basic decisions that a country must make when planning for its national defense. Whereas the mass standing armies of the past tended to rely upon compulsory military service to fill the ranks, the trend over the last few decades has clearly been toward smaller, leaner, more professional forces. A discussion of the merits of professional armies tends to focus on the need for a higher standard of training and the employment of ever-more sophisticated weapons systems. Another

consideration may be the desire to lower the political cost of expeditionary operations. The relative cost of either option is often a significant aspect of this debate. However, it is necessary to consider the rela-

“Taiwan is one of many countries that have decided to move toward a fully professional military, part of a growing global trend accelerated by the end of the Cold War.” tionship between a nation’s society and its military. In the conscript model, the whole society is called upon to shoulder the burden of national defense, up to its ultimate price. In the professional model, this becomes a choice. A positive aspect may be higher motivation, since only those willing to serve actually do. A negative side effect may be a widening gap between the armed forces and the greater society: a particularly grave danger if potential soldiers make


their decisions on whether or not to join the military driven primarily by financial considerations. Taiwan is one of many countries that have decided to move toward a fully professional military, part of a growing global trend accelerated by the end of the Cold War. However, in the current transition period, recruitment targets are not being met.

Insufficient incentives In the first half of 2013, only 1,847 people were recruited, or about 31 percent of the 5,887 goal, it has been reported. A number of commentators have enumerated the reasons why young Taiwanese are seemingly not eager to become professional soldiers: First and foremost is the low pay (around US$13,000 per year) in comparison with current starting wages in the civilian economy, which can

be several times as high. Shuai Hua-ming, a former Kuomintang (KMT) member of the Legislative Yuan, told reporters that he believes “a minimum of NT$40,000 per month (US$16,300 annually) will be needed if the military is to prompt the youths to have a serious consideration about the openings as one of their possible career options.” The retired lieutenant general also criticized the training as being “basic and boring,” and called for an overhaul to make it more attractive. Other factors often cited are the lower birth rate in Taiwan, lack of prestige of the martial profession, and unappealing benefit packages for soldiers. In the wake of the scandal surrounding Hung Chung-chiu, who died under suspicious circumstances while being punished by his superiors for carrying a cellphone, the military as an institution lost the confidence of many in Taiwan society, further ham-

Recruiting Woes  b  25

pering efforts to transition to an all-volunteer force (AVF). The government announced in September 2013 that it was pushing back by an extra two years the target date for the full professionalization of its armed forces; from 2014 to 2016. At the same time, it announced improvements to the living conditions of volunteers, with 35 trial-run units exclusively made up of such soldiers, as well as providing members with individual quarters, and in some cases allowing them to live off-base and pursue higher education, according to the KMT website.

after the former has been selected so is the transition and in particular the efforts to meet recruitment targets. However, two key questions remain. Writing in The Diplomat, J. Michael Cole asked whether troops would, in the event of an invasion, “offer stiff resis-

“They hold the parallel belief that the current state of improved cross-strait relations has made war a practical impossibility.”

Questions remain Although all of this has attracted a great deal of media coverage and public debate, to some extent a very significant aspect may not have received as much attention as it should; The choice between a professional and a conscript military is important, and

tance, fight bravely and efficiently, or … surrender in the face of a much more powerful and zealous adversary.” The second question is whether a clear distinction between combatants and non-combatants would be adhered to, or whether Taiwan would resort to non-conventional, asymmetric warfare.


Concerning the first, that author noted that many in Taiwan have become convinced of the belief (however inaccurate) that the People’s Liberation Army (PLA) has become so powerful that any resistance would be futile. Moreover, they hold the parallel belief that the current state of improved cross-strait relations has made war a practical impossibility. These beliefs are widespread and have a negative impact on recruitment. In fact, there is no reason why Taiwan should not be able to defend itself in spite of whatever growth there has been in China’s military capabilities. This would require a switch to a more asymmetric style of warfare, however, as well as a clear understanding

that no other country is likely to come to the island’s aid until a strong, determined effort had first been made by the Republic of China (ROC) military, and a high price in terms of life and property paid.

Multiple identities The question is whether this is compatible with democracy and the co-existence of different national identities, which precisely because Taiwan is a democracy are here to stay. The existence of multiple identities may make it imperative for the island’s military planners to promote a concept of loyalty, rather than identity, as the linchpin of military recruitment and defense. The idea would be for the military to set aside ideological issues such as whether Taiwan is an independent country or part of a wider Chinese nation—a matter which, in a democracy, is properly left in the hands of the people. They must instead stress that Taiwan will be what the people of the island want it to be, but that in order for this freedom of choice to be more than an academic right, it is necessary to develop a strong defense posture, and to impose an unbearable price on any invader. While efforts to prevent enemy landings would be in the hands of the professional military, the question is open as to whether, in the event PLA forces succeed in

Recruiting Woes  b  27

establishing a bridgehead, further actors should join in the task of repelling them. Leaving the discussion on possible guerrilla action for another occasion, perhaps this is where the four-month compulsory military training—which will survive the switch to a professional army—may fit in.

Military reserves Planners hope to employ a reserve system among Taiwan’s adult males not unlike what is practiced in Switzerland, wherein conscripts not only undergo this initial training but periodic refresher drills. Surely, given the existential threat to the Taiwanese way of life, the men and many of the women of the island would be willing to take part in such a system wherein they would be free to engage in their professional careers in the civilian sector while retaining a part-time connection to the military after the mandatory four-month term of service. The main task

of these irregulars could be primarily logistical and supportive in nature, as well as to furnish troops to engage in regular, yet asymmetric, battle should the enemy succeed in landing. Among other advantages, this would allow the professional component of the armed forces to shrink below current estimates, thus helping bridge the gap with actual recruitment levels. The resulting division of labor may also make it easier for the professional


component to concentrate on its core tasks, while the reserve, whose training would be local, could take advantage of its superior familiarity with the terrain. At a political level, this dual approach to defense would make it clear that loss of control over Taiwan’s sea and skies, followed by a landing by PLA forces, would in no way mark the end of the conflict. This would contribute to deterrence, by making it clear to a would-be aggressor (and to potential allies alike) that there is no scope for a strike against purely military targets followed by negotiations.

Loyalty a necessity The successful AVF transformation of the military, its strong links to the population, and a credible deterrent, in a democratic context, all require the development of a concept of loyalty as opposed to one of identity. This would prevent the military from becoming involved in political debates, while contributing

to professional recruitment and to the credibility of the armed forces. Given different views on the future of the island, the only common ground likely to command a clear majority is that Taiwan will be what the Taiwanese want it to be, but this right can only be exercised in practice if protected by the sword of a strong, credible military. Freedom never comes free. Concerning the surviving four-month compulsory military training period for young men, it could become the main pillar of the aforementioned reserve system, and in turn the mainstay of post-invasion combat. This would allow the professional core of the armed forces to concentrate on other missions. It would also enhance the credibility of Taiwan’s defense posture and help deter would-be invaders, by making it clear that the fight would go on even in the event of losing command of the air and the sea. This should help dispel the temptation for China to seek victory at the negotiating table after a few strikes on ROC military targets. n

b  29

Strategic Vision vol. 3, no. 13 (February, 2014)

Crude Assessment Taiwan’s dependence on Middle East oil yields vulnerability on energy security Serafettin Yilmaz


uch of the scholarly writing on energy security in Asia focuses on major consumers such as China and Japan, whereas the Republic of China (ROC) on Taiwan is often overlooked. Nevertheless, the country is no less dependent on hydrocarbon resources than Asia’s heavyweights. In order to arrive at a concise analysis of energy security in Taiwan, a conceptual framework on energy and securitization must be laid down, and then the spotlight trained on Taiwan’s strategic dependency on the Middle East.

With the advent of mechanical production and motorized transportation, hydrocarbon resources have become a staple for sustainable industrial growth. However, the uneven geographic distribution of resources and disparate levels of development have created dependencies between suppliers and consumers, which, from the late 1960s on, have led to the emergence of the concept of energy security. Energy security is a relative concept understood differently depending on a number of variables including the resources in question (some natural resources

photo: impaulsive photography A beach in Kenting. Taiwan imports the vast majority of its energy resources save for a miniscule amount produced by wind and nuclear plants.

Dr. Serafettin Yilmaz received his PhD at NCCU and currently works as a researcher at Academia Sinica. His research interests include comparative regional development and critical theory. He can be reached for comment at


photo: Roger Gordon A night market in Taichung. Taiwan’s energy consumption is substantial, aided in part by the central government keeping energy prices artificially low.

are more evenly distributed than others), whether energy policy is state- or market-led, whether it is looked at from the supply side or the demand side, the geographic distance between source and market, and the safety of overland and maritime transportation routes. What is called energy security is the sum of an extremely complex set of variables that determine the way nations shape and manage their energy policy. At the state level, energy is related to national security. If national security is analyzed in terms of economic, military, and sociopolitical and cultural components, energy security cuts across all three. In this sense, energy is a major component of national security strategy. Approached from the demand side and at the state level, energy security strategy is defined as the provision of a reliable and adequate supply of energy at a reasonable price. With the emergence of the environmental movement, a fourth component, acceptability has been added to the definition. To emerging nations, reliability and adequacy are more important than affordability and societal acceptability. Affordability is harder to ensure because resource-dependent na-

tions have very little say on world commodity prices, and acceptability may not be considered as urgent because national development is prioritized at the cost of environmental degradation.

Securitization The question arises, then: How is energy securitized? Securitization comes as a result of three interrelated factors: The first is dependency, which is defined as the presence of a difference between national production and consumption. Resources are distributed unevenly across the globe; a fact that is especially visible with respect to oil. Indeed, the Asia-Pacific, Europe, and North America account for over 80 percent of world oil consumption, while they control only 10 percent of the world’s oil reserves. In contrast, 90 percent of the world’s oil reserves are controlled by Africa, the Middle East, South America, and the states of the former Soviet Union, while together they account for just 20 percent of global consumption. The second factor is geopolitics. Geography involves physical distribution, transportation, and the pro-

Taiwan Energy Security  b  31

cessing of energy resources. Geography has three components: Physical structures such as refineries and distilleries; transportation structures such as pipelines, tankers, and railways; and storage structures such as oil tanks. Politics involves state-level (or state-led) interactions, including negotiation, regulation, supervision and management of the acquisition and allocation of energy resources. Energy geopolitics, hence, refers to the state-led handling of national energy strategy. Essentially, whenever the state is involved, energy is securitized. This causal relationship is better observed in the developing and developed economies of East Asia, including Taiwan’s, in which one can perceive causality between energy security and national security.

State response Finally, the third factor is the state’s response to internal and external energy security issues. Internally, any development that affects the quantity and reliability of indigenous energy supplies may create security concerns. Among these are geology (the physical location of the resources), level of technology, efficiency, and political effectiveness. Externally, all fac-

tors that affect the availability of energy supplies may lead to energy insecurity. Among these are external interventions or internal sociopolitical or economic disorder in resource-rich countries; terrorism and piracy; the vulnerability of trade routes to state and non-state actors; and natural disasters. Doubtlessly, a nation would not be able to address all these potential

“Taiwan’s total energy consumption has grown from over 300 million barrels equivalent of oil in 1991 to 700 million barrels in 2011.” threats equally effectively; neither would they arise all at once. Understandably, addressing domestic problems is easier than trying to deal with external crises. In any event, the action taken would be politicallycharged, and hence state-led. According to the ROC government publication Taiwan Energy Statistics Handbook 2011, Taiwan’s total energy consumption has grown from over 300 million barrels equivalent of oil in 1991 to 700 million barrels in 2011, registering an average annual growth of 3.78 percent. In 2011, energy and industrial sectors consumed over 45 percent of the total, whereas transportation, services and residential sectors ac-

Energy map: source SG


lion barrels in 1991 to 280 million barrels, 99 percent of which is imported. Finally, natural gas consumption has grown moderately from 1,340 million cubic meters in 1991 to 1,499 million c/m in 2011, whereas domestic production declined from 987 million c/m in 1991 to 330 million c/m in 2011. From a geopolitical perspective, oil is the most important of the three major energy resources due to the fact that over 80 percent of it comes from the Middle East. On the other hand, Indonesia and Australia provide almost 80 percent of Taiwan’s coal supply, and about half of its natural gas comes from Malaysia, Indonesia and Australia. As for crude oil, more than 80 percent is acquired from six Middle Eastern countries: Saudi Arabia (33.8 percent), Kuwait (23.1 percent), the United Arab Emirates (6.0 percent), Iran (3.8 percent), Iraq (2.8 percent), and Oman (1.4 percent). In this respect, Taiwan’s enphoto: baklavabaklava ergy dependency pattern is similar to Most of Taiwan’s oil imports come from the Middle East, especially Saudi Arabia and Kuwait. that of Japan. Indeed, in 2011, Taiwan’s counted for 12 percent, 11 percent, and 11 percent, dependency on foreign energy stood at 97.68 percent; respectively. slightly higher than Japan’s 96 percent. Dominated by conventional resources, Taiwan’s enThe role of nuclear power in Taiwan’s energy supply ergy mix has not changed significantly over the past has been a controversial issue, involving the general two decades. Currently, oil accounts for over 45 perpublic, local governments, business entities, politicent of its total energy consumed, followed by coal cal elites and the media. Currently, six active nuclear (31 percent), liquefied natural gas (LNG) (11 percent), reactors in three nuclear plants account for about 16 and nuclear (9 percent). Since Taiwan’s indigenous energy resources are limited, virtually all hydrocarbon resources are imported. In 2011, coal consumption reached 64.8 million metric tons. As coal is no longer produced in Taiwan, and has not been since 2001, all of it is imported. Annual oil consumption has grown from 188 mil-

percent of Taiwan’s total energy production. The debate over the fourth power plant in Lungmen was reignited after three reactor meltdowns crippled Japan’s Fukushima nuclear plant in March 2011 due to damage from an unprecedented earthquake and tsunami. The Lungmen plant with its two nuclear reactors has been under construction for 15 years, a 10-year

Taiwan Energy Security  b  33

Energy map: source SG

delay over the initial plan for completion. If it is not delayed further, fuel will be loaded into the first and second units in 2015 and 2017, respectively. Taiwan’s three original power plants also underwent recent upgrades to extend their service life.

Nuclear option Admittedly, nuclear power is cheaper than the alternatives. According to the World Nuclear Association, in 2008, the average cost of energy production in Taiwan was US7.0 cents/kilowatt hour (c/kWh) with coal-fired generation at US5.8 c/kWh and LNG at US11.25 c/kWh. The Lungmen reactors, on the other hand, are expected to generate power at US3.8 c/ kWh in their first 10 years of operation. Nonetheless, nuclear reactors still account for less than one-fourth of the energy generated in thermal reactors (77 percent in 2011). The share of nuclear power in Taiwan’s total energy stood at 8.82 percent in 2011, a fraction of that for coal (31.38 percent), oil (46.17 percent) and natural gas (11.78 percent). The share of renewables is even smaller in Taiwan’s energy mix. Power generated from wind grew from 0.004 percent in 2001 to 0.719 percent of total production in 2011. Energy generated from solar increased from a microscopic 0.0002 percent in 2008

to 0.0179 percent of the total in 2011. In the same year, the combined share of solar, wind and geothermal stood at 0.11 percent of the total. The reason for the slow growth in alternatives remains an economic one: The ROC government has kept electricity prices artificially low in order to protect Taiwan’s export-driven economy. Renewable energy production requires high initial costs, and the recovery rate is much lower than for nuclear or thermal energy. The combined effect of low energy prices and high startup cost has rendered alternative energy an unfeasible investment

“Given the lack of direct diplomatic relationships with any of the Middle Eastern states, Taiwan’s single most important relationship with the region— especially the Gulf—is through energy.” for the private sector. All in all, Taiwan’s dependency on hydrocarbon resources cannot be ignored and is likely to remain potent for the foreseeable future. As seen from the brief data provided above, Taiwan is not only energy dependent, in terms of crude oil, it is highly dependent on a region that is economically, politically, and militarily unstable. This mixture of vulnerabilities renders Taiwan’s energy security a


photo: Prince Roy Monument to the coal miners of Pingxi. The government has hailed them as the heroes who made the economic takeoff of the 1960s and 1970s possible.

geopolitical issue that needs to be tackled through high-politics. Securitization requires Taipei to play the leading role in the design, guidance, execution and further assessment of energy strategy.

Interaction via energy Given the lack of direct diplomatic relationships with any of the Middle Eastern states, Taiwan’s single most important relationship with the region—especially the Gulf—is through energy. Considering that the nature of this relationship is not likely to change in the foreseeable future, energy remains the only viable means of interaction with the region as well. Furthermore, energy is still indispensable for the Taiwanese economy, in which industry makes up 35 percent of the total economy and over 30 percent of GDP. Coupled with an absence of much international political clout, the ROC’s over-reliance on the Middle East for energy exposes Taiwan to the negative implications of political and socioeconomic turbulence in the region to a greater degree than many other

countries. Taipei’s need for the US security umbrella also takes away much of the bargaining power that it would otherwise have. Consequently, despite the clear advantages of buying Iranian crude oil (which

“The obvious solution for ROC energy policy is source diversification. One of the most viable candidates for this is Russia.” is marked by a low density and low sulfur content that allows blenders to extract more value from the oil), Taiwan has been forced to cut imports from the country in order not to estrange Washington. Obviously, like any other industry in East Asia, the energy trade with the Gulf also makes sense for Taiwan considering that the Gulf autocracies have firm US support. However, too heavy a reliance on Gulf oil brings about additional security risks. First, although at the moment it seems a distant likelihood, the slippery political ground in the Middle East has the very potential to send the Gulf monarchs into a

Taiwan Energy Security  b  35

chaos reminiscent of the Arab Spring. Especially the situation of the Al Saud family, where in the event of the death of the present king, it is not unlikely that infighting and regime instability might result, which would negatively affect Taiwan’s largest energy partner. Second, the Iran-Saudi proxy war presently underway in Syria might lead to further regional tensions between the two nations facing each other across the Persian Gulf. Finally, the re-emergence of sectarianism and the powerful comeback of Al Qaeda in places such as Iraq, Syria, Lebanon, Yemen and Egypt could result in a further increase in terrorist activities that might eventually impact the security of the energy infrastructure and maritime transportation. It follows that the obvious solution for ROC energy policy is source diversification. One of the most viable candidates for this is Russia. Indeed, there has been an acknowledgement of this for some time in Taiwan. The most notable development in this regard was the 2012 Moscow-Taipei Coordinating

Commission for Economic and Cultural Cooperation meeting at which the two sides discussed the feasibility of opening negotiations for the purchase of oil and natural gas from Russia. However, in order for these aspirations to translate into actual reality, certain issues encountered in the past—such as the unreliable quality of the shipments and complications in securing supplies—need to be addressed for the initiative to succeed. Taiwan’s situation is a textbook case for the framework of energy securitization. Obviously, for Taiwan, hydrocarbon resources are still the single most important source of energy since it is dependent on others for their procurement. Therefore, Taiwan’s energy security strategy will have to remain forward-looking, proactive and diversification-oriented. In addition to off-shore exploration in the near waters and joint ventures abroad in which Taiwan’s oil companies are engaged, Russia and the states of Central Asia provide a tempting alternative to consider for relatively secure sources of energy. n

photo: Maggie Chou A family enjoys the sunset at a wind farm near Gaomei Wetland in Taichung County. Less than 1 percent of Taiwan’s power generation comes from wind.

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Strategic Vision, Issue 13