ONE: PREAMBLE
Following his presidential inauguration in May, President Ma Ying-jeou has been working towards improving cross-Strait relations, normalizing trade between mainland China and Taiwan, and resuming bilateral high-level talks. After several restructuring efforts, the SEF and the ARATS officially restored mechanisms for institutionalized dialogue and negotiations. Regular correspondence was reestablished within months and the SEF delegation arrived at Beijing on June 11, 2008, on a “Journey of Mutual Trust and Negotiations" to discuss several agreements with the ARATS and to promote deeper understanding between the two organizations.
In the First Chiang-Chen Talks, Minutes of Talks on Cross-Strait Charter Flights and the Cross-Strait Agreement on Travel by Mainland Residents to Taiwan were signed. Moreover, SEF Chairman Chiang issued a formal invitation for ARATS President Chen to visit Taiwan before the year-end. His mainland Chinese counterpart agreed to the suggestion of holding the second round of Chiang-Chen Talks in Taipei. Following their agreement, both organizations began preparations by planning the details of cross-Strait plane routes, terminal locations, flight frequency, air cargo shipments, maritime transport and postal service cooperation. The high-profile melamine-tainted food outbreak took place at this time, and both parties agreed to add food security to the list of high-priority issues to be addressed in the next round of cross-Strait negotiations.
Details of the planning and implementation of the Second Chiang-Chen Talks, which were conducted in accordance with the concepts of "Reciprocity, Dignity, and Security," are listed as below. The information is organized into sections describing the pre-meeting preparations; the breakdown of the daily itinerary; highlights of the negotiation talks, including the role the SEF played in the event; and the final outcome of the second round of high-profile talks.

TWO: PRE-MEETING PREPARATIONS

1. Special Task Team
The SEF and the Mainland Affairs Council (MAC) created a special task team to oversee efforts related to ARATS President Chen’s passage to Taiwan and the hosting of the Second Chiang-Chen Talks in Taipei.

2. Preparatory Meeting
To facilitate a consensus between the two parties, the SEF was authorized by the MAC to set up preparatory meeting to confirm details relating to the four priority areas of air transport, maritime transport, postal service, and food security. On Oct. 27, both parties met at the Wuzhou Guest House in Shenzhen, China. Headed by SEF Vice Chairman Kao, the SEF delegation included representatives from the MAC, the Ministry of Transportation and Communications, and the Department of Health. The delegation was greeted by ARATS Vice Presidents Zheng Lizhong and Li Bingcai, who led the relevant mainland Chinese officials in confirming the contents of the four agreements and the itinerary of ARATS President Chen’s visit to Taiwan.
Led by ARATS Vice Presidents Zheng and Li, the first ARATS delegation, comprising 20 officials, arrived in Taiwan on the evening of Oct. 31 and met with SEF Vice Chairman Kao on the morning of Nov. 1 to confirm the details of administrative affairs, personnel security, official documents, and event schedules.

THREE: ITINERARY BREAKDOWN
On November 3, 2008, ARATS President Chen and a 54-member delegation arrived on a weekend charter flight at the Taoyuan International Airport at 11:46 AM. The mainland Chinese officials were greeted by SEF Vice Chairman Kao, who escorted the group to the Taipei Grand Hotel where SEF Chairman Chiang and his wife awaited their arrival.
Altogether, the 74 delegates from mainland Chinese included representatives from the ARATS, the Taiwan Affairs Office, the PRC Ministry of Transport, the PRC Ministry of Health, the People’s Bank of China, the China Banking Regulatory Commission, the China Insurance Regulatory Commission, and the China Securities Regulatory Commission. This was the first time high-level government officials had traveled from Beijing to participate in talks in Taipei, signifying a new milestone in cross-Strait relations.
Upon his arrival in Taipei on Nov. 3, ARATS President Chen met with Madam Koo Yan Zhuo-yun, while the last round of preparations was made by SEF Vice Chairman Kao and his mainland Chinese counterparts, ARATS Vice Presidents Zheng and Li. The Second Chiang-Chen Talks were held on the morning of Nov. 4, and ARATS President Chen made a special trip to pay his respects to the late Taiwanese tycoon Wang Yung-ching during lunchtime. Later that afternoon, after holding a signing ceremony to ink four cross-Strait agreements, the ARATS delegation met with MAC Minister Lai Shin-yuan at the Regent Taipei Hotel. The next morning, after dining with Legislative Yuan Speaker Wang Jin-pyng in an informal breakfast meeting, ARATS President Chen participated in the Cross-Strait Forum on Manufacturing and Sea Transport and the Cross-Strait Financial Summit, which were attended by businesspeople from both sides of the Strait. In the afternoon on Nov. 5, ARATS President Chen toured the Hsinchu Science Park, listened to a briefing by the Science Park Administration, and visited the factories of AU Optronics and Altek, while the mainland Chinese financial business people were shown around the Cathay Financial Plaza and the Gre Tai Securities Market. A press conference was held on the morning of Nov. 6, at which live gifts such as pandas, Formosan serows, Formosan sika deer, and Dove Trees were exchanged. Shortly after the media event, President Ma Ying-jeou met with SEF and ARATS representatives at the Taipei Guest House at 11 AM. After meeting the president, ARATS President Chen made a special trip to Guandu to see Dharma Master Cheng Yen at the Tzu Chi Culture and Communication Foundation. On the evening of Nov. 6, the SEF arranged for the ARATS delegation to watch the renowned Taiwanese cinematic production “Cape No. 7” at the Taipei Grand Hotel before the start of the farewell dinner party, at which the mainland Chinese delegates thanked the SEF and related personnel for their assistance and cooperation. On the morning of Nov. 7, SEF Chairman Chiang and his wife traveled to the Taipei Grand Hotel to bid ARATS President Chen and Chen’s wife goodbye; the ARATS delegation was escorted by SEF Vice Chairman Kao to Taoyuan International Airport, where they boarded a chartered China Airlines plane bound for Beijing. For more details concerning ARATS President Chen’s Taiwan visit, please see the attached document titled “Itinerary of ARATS President Chen’s Taiwan Visit.”

FOUR: NEGOTIATION HIGHLIGHTS
1. Four Agreements Signed
Four agreements were signed at the Second Chiang-Chen Talks: the Cross-Strait Air Transport Agreement, the Cross-Strait Sea Transport Agreement, the Cross-Strait Postal Service Agreement, and the Cross-Strait Food Safety Agreement. The text of the four agreements has been sent for approval by the Executive Yuan. In accordance with Article 95 of the Act Governing Relations between the People of the Taiwan Area and the Mainland Area, a copy of the air and sea transportation agreements has been sent to the Legislative Yuan for approval. The text of the postal-service cooperation and food-safety agreements has also been submitted to the Legislative Yuan. The key points of the four agreements are outlined below:

I: The Cross-Strait Air Transport Agreement
1. Flight Routes
(1) Both parties have agreed to open a direct two-way flight path between Taipei and Shanghai and to establish a procedure for direct handover between the air-traffic control departments on either side of the Taiwan Strait.
(2) Both parties have agreed to continue discussing the opening of a direct two-way flight path in a southern line across the Taiwan Strait as well as the establishment of other convenient flight paths.

2. Regular Charter Flights
(1) Both parties have agreed to lift the weekend-only limit on cross-strait charter flights; passenger charter flights will now be available 7 days a week.
(2) Flight Points for Direct Flights:
A. Taiwan will maintain 8 available flight points.
B. China has raised its total to 21 available flight points.
(3) Number of Flights:
A. Both parties have agreed to increase the total number of cross-Strait passenger flights from 36 to 108 flights per week.
B. The weekly number of flights can be altered accordingly to future market demand.

3. Cargo Planes
(1) Both parties have agreed to launch direct two-way cargo flights.
(2) Airfreight Destinations:
A. Taiwan has opened the Taoyuan International Airport and the Kaohsiung International Airport for cross-Strait air transport.
B. China has opened the Shanghai Pudong International Airport and the Guangzhou Baiyun International Airport for cross-strait air transport.
(3) Number of Flights:
Both parties have agreed to set the threshold at 60 return cargo flights per month; during the peak season for airfreight—between October and November every year—both parties can request an additional 15 return cargo flights if the need arises.

4. Scheduling and Implementation
Both parties have agreed to do everything possible to complete arrangements for regular cargo flights within six months of the implementation of this agreement.

II: The Cross-Strait Sea Transport Agreement
1. Vessel Eligibility
(1) A vessel with capital from either side of the Taiwan Strait, which is registered with both sides.
(2) A vessel with capital from either side of the Taiwan Strait, which is registered in Hong Kong.
(3) Vessels owned by people from either Taiwan or mainland China but are registered at a third country.

2. Direct Shipping Points
(1) Taiwan has opened 11 docking points and ports for direct cross-Strait sea transport.
(2) China has opened 63 docking points and ports for direct cross-Strait sea transport.

3. Mutual Tax Exemption
To avoid the complication of double taxation, companies operating marine transportation services that cross the Taiwan Strait are exempt from business and income taxes on transportation revenue and income earned on the opposite side of the Strait.

III: The Cross-Strait Postal Service Agreement
Both parties have agreed to open cross-Strait services for the direct delivery of ordinary and registered mail, small packages and parcels, express delivery mail, and postal remittances.

IV: The Cross-Strait Food Safety Agreement
1. Prompt Information Notification
The two sides have agreed to exchange information concerning food safety in cross-Strait trade and to provide immediate notification if incidents suddenly arise and affect the health of people on either side of the Taiwan Strait.

2. Handling Mechanism
The two sides have agreed to establish a mechanism for handling major cross-Strait food-safety incidents by adopting the following measures:
(1) To hold emergency discussions and to exchange relevant information.
(2) To suspend the production and export of the concerned products.
(3) To promptly stop sales of identified products by recalling them.
(4) To provide assistance and access to field inquiries.
(5) To verify and announce information each other.
(6) To provide an analysis of the cause of the accident and to make provisions for improvements.
(7) To supervise the responsible parties in handling post-disaster disputes and to safeguard the victims’ rights.
(8) To provide timely updates on the status of the investigation of responsible parties.

3. Operational Exchanges
Both parties have agreed to establish a system of regular meetings and mutual visits by experts from competent authorities on each side, to conduct contacts and information exchanges on food-safety laws and regulations, inspection techniques, and regulatory measures.

2. Meeting Minutes
One: Preparatory Meeting
1. Prior to the Second Chiang-Chen Talks, SEF Vice Chairman Kao and ARATS Vice President Zheng conducted a final round of preparatory talks to confirm the text of the four cross-Strait agreements and to discuss issues related to their implementation.
2. To ensure smooth execution and to foster the desired outcome of implementing the four agreements, air control officials and related agencies from both sides of the Strait met to discuss the procedures, document authentication, and important dates related to cross-Strait air transportation.

Two: Chiang-Chen Talks
1. Review of the Two Agreements Signed in June 2008
After the signing of a bilateral agreement that permitted direct charter flights across the Strait during weekends, public sentiment highlighted the restrictions on the number of flights and flight points as unsatisfactory. In light of this feedback and subsequent cross-Strait discussions, both parties have agreed to complete all the arrangements needed to implement regular charter flights within the next 6 months. Concerning the Cross-Strait Agreement on Mainland Tourists Traveling to Taiwan, the tourism volume between the two sides of the Strait has not yet reached the projected numbers. Taiwanese tourism authorities have agreed to diversify the tour packages offered to mainland visitors, loosen the restrictions on the number of travelers per group, extend the duration of stay, and simplify the application process; mainland Chinese authorities in turn have agreed to increase the number of regions eligible for the cross-Strait tourism program as well as the number of groups permitted to travel to Taiwan.

2. Agreements on Air and Sea Transport, Postal Services and Food Safety Confirmed
The text and contents of the four agreements have been confirmed and signed; they are to come into effect by mid-December at the latest.

3. List of Priority Issues for Future Rounds of Negotiations
(1) Strengthening the order of cross-Strait exchanges
(2) Cross-Strait financial cooperation
(3) Cross-Strait investment cooperation
(4) Cross-Strait industrial and manufacturing cooperation
(5) Cross-Strait fishery cooperation
(6) Cross-Strait cultural and educational exchanges

4. Strengthening Ties and Exchanges between the SEF and the ARATS
(1) Both parties have agreed to institutionalized dialogues such as biannual meetings between the SEF chairman and the ARATS president and to quarterly meetings between SEF secretary-generals and ARATS vice presidents; other bilateral exchanges can be arranged if the need arises.
(2) Both parties have agreed to strengthen ties and exchanges on the level of board directors.
(3) Both parties have agreed to organize professional exchanges.
(4) ARATS President Chen has invited SEF Chairman Chiang to visit China next year to follow up on the negotiations concerning priority issues and cross-Strait agreements.

Three: The Signing of Agreements and the Exchange of Gifts
The Cross-Strait Air Transport Agreement, the Cross-Strait Sea Transport Agreement, the Cross-Strait Postal Service Agreement, and the Cross-Strait Food Safety Agreement were signed at 2 PM on Nov. 4, 2008. The agreement-signing ceremony was followed by a gift-exchange event, during which SEF Vice Chairman Kao and ARATS Vice President Zheng noted the significance of the chosen gifts. Overall, the ceremonies were grand, stately, and fruitful.

3. Academic Seminars
To foster closer bilateral trade and cooperation, to implement the Cross-Strait Air Transport Agreement and Sea Transport Agreement, and to create a solution for the global financial tsunami, the two parties coordinated two seminars for experts from both sides of the Strait to explore new areas and possibilities for advancing cross-Strait economies. SEF Chairman Chiang and ARATS President Chen were the keynote speakers for the two seminars.

One: The Cross-Strait Forum on Business Coopeation and Sea Transport
Held at the B1 De Hou Room of the Taipei Grand Hotel, the forum was presided over by SEF Vice Chairman Kao and ARATS Vice President Zheng. The forum explored methods of strengthening bilateral trade ties, integrating sea-transport operations, and mitigating the effects of the global financial crisis.

Two: The Cross-Strait Financial Summit
(1) Held in the B1 Fu Quan Room of the Taipei Grand Hotel, the summit was jointly presided over by Yen Tzung-ta, director general of the ROC Central Bank’s Department of Economic Research, and Jin Qi, director of the Hong Kong, Macau, and Taiwan Affairs Office under the People’s Bank of China. The summit discussed potential collaborative methods for both economies to weather the storm and regain financial growth.
(2) Experts and financial business people from both sides of the Taiwan Strait presented experiences and lessons learned from the global recession, exchanged theories and mitigation methods on how to weather the economic crisis, and explored methods of fostering closer financial ties and cooperation.

4. High-level Visits
One: MAC Minister Lai receives ARATS President Chen
ARATS President Chen visited MAC Minister Lai Shin-yuan at the Regent Taipei Hotel on Nov. 4, 2008.

Two: President Ma receives SEF and ARATS representatives
President Ma Ying-jeou met with SEF and ARATS representatives at the Taipei Guest House at 11 AM on Nov. 6, 2008. President Ma thanked both organizations for their hard work and efforts. Gifts were exchanged and photographs were taken to commemorate the historic event.

5. Outcome and Significance of the Second Chiang-Chen Talks
(1) ARATS President Chen and his Wife’s First Visit to Taipei
Upon the SEF’s invitation, ARATS President Chen and his wife traveled to Taipei for the first time to participate in the second round of Chiang-Chen Talks. Moreover, both parties conducted their exchanges in a professional and courteous manner, signifying a new milestone in cross-Strait institutionalized dialogue. Normalized relations between the SEF and the ARATS reflect a stable development in bilateral ties, the significance of which will not be lost on Southeast Asia and the rest of the international community.

(2)Four Cross-Strait Agreements are Signed
The four agreements signed at this high-level meeting are all pertinent to the welfare and economic wellbeing of the people on both sides of the Strait. The agreements on air travel, sea transport, and postal services will not only bring people closer but will also lower the costs and increase the efficiency of cross-Strait dealings. The food-safety agreement, which is aimed at safeguarding consumer rights and health, will also serve as a foundation for agencies on both sides of the Strait to cooperate on a professional level. The success of the Second Chiang-Chen Talks signifies the end of the Three No’s era—no contact, no compromise, and no negotiation—and points to the beginning of a new epoch in which Taiwan’s national image and industries will shine again.

(3)The Cross-Strait Forum on Business Cooperation and Sea Transport and the Cross-Strait Financial Summit
The two organizations went to great lengths to coordinate the Cross-Strait Forum on Business Cooperation and Sea Transport and the Cross-Strait Financial Summit. In the face of the global financial crisis, the two economies should work together to mitigate the effects of the worldwide recession and stabilize the regional economy. Closer economic cooperation will enhance the competitiveness of Taiwanese businesspeople in mainland China, normalize bilateral trade ties, and create mutually beneficial outcomes that will serve as the foundation for peace and prosperity on both sides of the Strait.

(4)Consensus on Priority Issues that Require Further Discussion
Both parties have not only reviewed the implementation and outcomes of the two previously signed agreements but have also reached a consensus on the priority areas and issues that need to be discussed in the next round of high-level talks. The SEF will continue to serve as the mediator for future cross-Strait dealings but will always do so with the best interests of Taiwan and its people in mind.

Six: Conclusion
Institutionalized cross-Strait dialogue is dedicated to trading opinions, fostering understanding, establishing trust, and promoting exchanges. The resumption of high-level talks in June was based on the concepts of equal footing, benevolent communications, consensus accumulation, and progressive gains. It was the first step toward normalized bilateral relations and the start of “Peaceful Taiwan Strait, Mutual Economic Growth.” ARATS President Chen’s first visit to Taiwan, which is an act of reciprocity that indicates our nation’s equal status in bilateral talks and exchanges, has also fulfilled the expectations of
people on both sides of the Taiwan Strait. In the future, the normalization of cross-Strait dealings will help safeguard consumer rights, resolve business and trade disputes, and bring long-term growth and stability to both economies. Under federal authority and legislative guidance, the SEF will continue to embrace its role as the mediator of cross-Strait affairs and will complete its mission in serving the people of Taiwan, negotiating cross-Strait agreements, and promoting bilateral exchanges. With the aid of a strong management team and well-rounded staff members, the SEF will strive to fulfill President Ma’s vision of a peaceful and prosperous Taiwan Strait. Based on the president's words -- "facing up to the reality, mutual non-denial, working for the benefits of the people, and cross-strait peace." - the SEF hopes to resolve cross-Strait disputes, to foster closer collaboration and to conduct more high-level visitations in the near future. Last but not least, the SEF looks forward to working with the ARATS in promoting mutual exchanges and contributing to the wellbeing of the people on both sides of the Taiwan Strait.