Vice President Lu, Presidents of the Five Yuans, Ministers, Distinguished Guests, Esteemed Colleagues, Ladies and Gentlemen:

A Happy Double Tenth and greetings to you all!

On this very special occasion of our Double Tenth National Day, we are gathered under one roof to celebrate our past accomplishments, reflect on our past shortcomings, and meditate in earnest on the course of Taiwan's future development.

You will note that the reviewing stand erected in front of the Presidential Office is different from past years in that it is adorned with a giant banner reading "UN for Taiwan, Peace Forever." This message signifies that our quest to gain entry into the UN will not be abandoned simply because of momentary setbacks. The Government of Taiwan will continue to pursue that goal with unwavering determination.

Taiwan is a sovereign nation. Its sovereignty rests in the hands of its 23 million people. Only the people of Taiwan have the right to decide their nation's future. United Nations General Assembly Resolution 2758, passed on October 25, 1971, neither defined Taiwan as a part of the People's Republic of China nor affirmed the proposition that the People's Republic of China has any right to sovereignty over Taiwan. Taiwan and the People's Republic of China are two sovereign, independent nations, and neither exercises jurisdiction over the other. This is a historical fact. This is the status quo across the Taiwan Strait.

The People's Republic of China has neither the right nor the ability to represent the 23 million people of Taiwan. Our people have the right to demand appropriate representation in the United Nations. We have the right to apply for admission to the UN as a new member under the name "Taiwan."

In the past, we have joined Asia-Pacific Economic Cooperation (APEC) under the name "Chinese Taipei," and the World Trade Organization (WTO) using the name "Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu." Though dissatisfied with this state of affairs, we have reluctantly accepted it in view of practical international realities.

Before 1971, the United Nations was beset with quarreling over the right to represent China. Hence, if we were to once more demand restoration of our UN representation under the name "Republic of China," it would not only constitute a direct challenge to Resolution 2758 but cause us to fall back into the anachronistic mentality of belief in "one China" and Chiang Kai-shek's dictum "Gentlemen do not stand with thieves" [i.e. there can be no conciliation with usurpers]. We would succeed only in making ourselves outcasts in the international community and exacerbating the dangers of isolation.

That we have applied for new UN membership under the name "Taiwan" indicates that we do not intend to challenge Resolution 2758 of the UN General Assembly. Nor do we wish to compete with the People's Republic of China for the right to represent China.

This year has seen our first application for UN membership under the name "Taiwan," and although, as expected, our hopes were not realized, Taiwan's membership bid gave rise to unprecedented discussion of the issue in the General Assembly. Representatives of some 140 of the 192 UN member states registered to speak on the question of whether Taiwan's application should be included on this year's General Assembly agenda, and the debate lasted for over four hours. Moreover, media reports on our UN bid were more than four times as many as in last year.

This all goes to show that this year's efforts to join the UN have been a diplomatic success, and have greatly raised Taiwan's visibility in the international community.

On behalf of the government and people of Taiwan, I would like to express our heartfelt thanks and highest respect to our diplomatic allies and their leaders for their support and speaking out at the UN General Assembly.

Notwithstanding the importance of the international community's expressions of support in our quest to gain membership in the UN, the decisive factor, after all, is the question of whether the people of Taiwan are united. A recent public opinion poll indicated that 55 percent of Americans think Taiwan should have a seat in the UN. When asked whether they would support UN membership for Taiwan if our forthcoming referendum on entering the United Nations using the name "Taiwan" is passed, another 15 percent, or 70 percent of the respondents, said "yes." This shows just how much the community of free and democratic societies respects the principle of referendum, a universal value and basic human right.

The principle "sovereignty lies in people" is the essence of democracy, and referendum is the most concrete, most direct expression of that principle. In 2003, we passed the first Referendum Act, and, in 2004, we held the first national referendum. In 2005, the Constitution was amended to abolish the National Assembly and empower the people to ratify constitutional amendments through referendum. In 2006, we mothballed the National Unification Council and its Guidelines for National Unification, dispelling the misconception of "ultimate unification" with China as a foregone conclusion, thereby enabling the 23 million people of Taiwan to enjoy the right to decide the future of their nation via referendum.

On September 14 of this year, the Central Election Commission officially announced its approval of a referendum proposal on the recovery of improperly obtained political party assets, to be held on January 12, 2008 in tandem with the legislative elections. And if the petition drive to hold a referendum on applying for UN membership under the name "Taiwan" is successful in gaining enough signatures by the end of October, and is announced valid upon review by relevant government agencies, we can look forward to holding it in conjunction with the upcoming March 22 presidential election.

From encountering initial resistance and opposition to finally being embraced and actively promoted, referendum has become a political process affirmed by both the ruling and opposition parties, and an indispensable part of Taiwan's democracy. Practical utilization of referendum in the past few years, however, has highlighted the absurdity and unreasonableness of the Referendum Act. The act restricts referendum topics, deprives administrative agencies of the right to initiate referendum proposals, and sets excessively high thresholds for referendum petition signatures and passage of referendum proposals.

All this seriously restricts the people and deprives them of the right to be masters of their nation. Moreover, it runs counter to the democratic principle that sovereignty lies in the hands of the people. I earnestly urge the ruling and opposition parties to speedily remedy the flaws in the Referendum Act. I call on them to complete the review of related legal amendments during the current Legislative Yuan session, and change the ridiculous "birdcage" referendum law currently in effect into one that genuinely empowers the people, and the substance of which lives up to its name.

This year marks the 60th anniversary of the February 28 Incident as well as the 20th anniversary of the lifting of martial law. Looking back over the past half century of progress on the path to democracy, we see that Taiwan's people have steadily realized their aspirations one after another—from the lifting of martial law, abolition of bans on establishing new political parties and newspapers, and nationalization of the armed forces [to ensure their loyalty to the nation rather than to individuals or political parties], to independence of the judiciary, overhaul of the parliament, direct presidential elections, and the establishment of a referendum system. Moreover, ongoing consolidation and deepening of democracy have ensured freedoms, human rights and well-being of Taiwan's people are continually safeguarded.

Regrettably, however, China, on the other side of the Taiwan Strait, has distortedly portrayed our people's efforts in the pursuit of democracy as moves toward "de jure independence." It has opposed and attempted to suppress all of our democratization efforts. Facts demonstrate that cross-strait problems do not derive from Taiwan, which respects freedom, democracy, and human rights, but from China, which is still under totalitarian, dictatorial rule. This is a reality that the international community must squarely face.

In recent weeks, the global community of democracies has strongly condemned Myanmar's military junta for its cruel suppression of the nation's Buddhist monks and citizens, and expressed the intention to impose sanctions on the regime. As a member of the alliance of nations that champion freedom and democratic values, Taiwan is willing to do its share to help restore democratic order in Myanmar as soon as possible. Infringements of human rights and suppression of democracy are definitely not mere "domestic affairs." While showing its keen concern for developments in Myanmar, the international community should also conscientiously examine China's dismal human rights record as well as its brutal suppression of the freedoms of speech, the press, and religion.

While China's slogan for the 2008 Beijing Olympic Games is "one world, one dream," the international community, for its part, should steadfastly demonstrate its moral fortitude in demanding that China adhere to a "one world, one standard" principle. There can be no double standards when it comes to the universal values of freedom, democracy, human rights, and peace.

The size of nations is irrelevant. The international community should not, in fear of China's military might, demand that Taiwan keep quiet. Nor should it, out of concern for commercial interests, turn a blind eye to China's military intimidation and diplomatic suppression of Taiwan, or to its "united front" economic warfare against Taiwan.

In a speech made in Kyoto in November 2005, US President George W. Bush said, "Free nations are peaceful nations, free nations do not threaten their neighbors, and free nations offer their citizens a hopeful vision for the future. By advancing the cause of liberty throughout this region, we will contribute to the prosperity of all—and deliver the peace and stability that can only come with freedom."

President Bush also publicly praised Taiwan's freedom and democracy, describing it as a model for China and other nations. Therefore, the more democratic Taiwan becomes, the more strongly it can exert a "lighthouse effect" for China's democratization, and the more it can contribute to safeguarding security and stability in the Asia-Pacific region. This evolutionary process, moreover, is in line with the common interests of the United States, Japan, and neighboring nations.

With China's rapid rise and relentless military build-up, the "China threat" is no longer confined to confrontation across the Taiwan Strait. In fact, it has already seriously impacted world peace. Members of the international community not only should refuse to join forces with China in suppressing Taiwan's democracy, but should strongly demand that China immediately withdraw missiles deployed along its southeastern coast and targeted at Taiwan, stop military exercises simulating attacks on Taiwan, abolish its so-called anti-secession law, and accelerate political and democratic reforms. We believe that only through China's democratic awakening can there be lasting peace in the world.

Faced with China's ever-more belligerent rhetoric and military intimidation since I took office, I have extended numerous olive branches expressing our desire for peace and conciliation. In return, we have been subjected to Beijing's five-pronged policy of suppression, aimed at denigrating our nation, marginalizing it in the world, cultivating the perception that Taiwan is a local region of China, delegitimizing its government, and undermining its sovereignty. To safeguard cross-strait and regional security and stability, however, we have never diverged from our fundamental policy of maintaining a firm stance and moving forward pragmatically as the basis for pursuing normalization of Taiwan-China relations.

Between 2000 and 2006, the annual number of visits by Taiwan's people to China increased from 3.11 million to 4.41 million, or an average of more than 12,000 visits per day.

Regarding direct transportation between Taiwan and China, whereas during the 2003 Lunar New Year holidays, Taiwan's air carriers first provided one-way, indirect passenger charter flights, during the 2005 Lunar New Year holidays, air carriers of both sides provided nonstop charter flights. Furthermore, in June 2006, four categories of charter flights were launched [passenger flights during major holidays, special cargo flights, medical emergency flights, and other humanitarian flights].

At present, passenger charter flight services are provided for more than ten weeks a year around the times of major festivals, carrying some 100,000 travelers. Moreover, our people make some 600,000 visits to China every year as part of the "mini-three-links" [direct mail and commercial links are already in place, while direct transportation is only provided between Taiwan's Kinmen, Matsu and Penghu islands and ports in China's Fujian Province]. I believe these transportation arrangements have succeeded in satisfying the demands of Taiwan's citizens who wish to visit China.

These figures are an indication that the importance of political considerations in discussions concerning the "three links" [the aforementioned direct links, but between Taiwan proper and other destinations in China] far exceeds that of satisfying transportation demands. Unless one is willing to totally disregard national security imperatives and abjectly surrender, the three links must evolve in an orderly, gradual manner. Certainly, it is impossible to reach the final goal of opening up free and direct links in one huge leap, or to impose any timeline.

As I have often reiterated in the past, the mini-three-links must precede the three links; charter flights must precede regularly scheduled flights; and facilitation of cargo transportation must precede that of passenger transportation. Now, the ball is in China's court. If China truly has the sincere desire to enter into negotiations on facilitation of cargo charter flights, we can look forward to solving a lot of problems.

Regarding economic relations between Taiwan and China: The volume of two-way trade was US$31.2 billion in 2000, and rose to US$88.1 billion in 2006. Over the same period, according to the Investment Commission of the Ministry of Economic Affairs, annual China-bound investment figures increased from US$2.6 billion to US$7.6 billion, and registered investments in China totaled US$46.6 billion, or about NT$1.56 trillion. This goes to show that economic interchange between Taiwan and China has become overheated, not too cold. About 70 percent of all outbound investment goes to China. This cannot be considered normal for any country.

Taiwan cannot cut itself off from the world, nor can it afford to lock all of its economic bargaining chips and lifeblood in China. It is perfectly understandable that businesses strive for profits. For its part, however, our government must consider the impact Taiwan-China trade has on the capital and labor markets as well as on the livelihoods of farmers, fishermen, and people in the middle and lower income brackets. It must also strictly safeguard the sustainable development of industries in Taiwan. Therefore, our economic policy of "proactive management and effective liberalization" vis-à-vis Taiwan-China economic interaction is certainly correct and necessary.

Though China is a very important market, it is not the only or ultimate market. We can never accept a "Taiwan-China common market"—that is, a "one China market" based on acceptance of Beijing's "one China principle"—as that would cause Taiwan's economy to lose its autonomy and render it utterly defenseless. China's cheap labor and agricultural products would flood the Taiwan market, resulting in our being economically absorbed even before we have been politically annexed. Only by keeping a firm grip on Taiwan's economic lifeblood can we ensure our nation's continued existence and sustainable development.

Over the past seven years, some people have tried to promote disparagement of Taiwan's prospects as a political movement. Recently, they have even repeatedly claimed that Taiwan has lost its place as one of the "four Asian tigers." I would like to call upon my compatriots to realize that so long as we cherish Taiwan in our hearts, we certainly will not fail to note its presence as an economic power.

Take, for example, forecasts for this year released by Taiwan's Directorate General of Budget, Accounting and Statistics and by the Central Bank of Korea concerning their respective nations:
‧Each country's economy will grow by 4.6 percent.
‧Taiwan's consumer price index will post a rise of 1.5 percent, South Korea's a rise of 2.5 percent.
‧Taiwan's unemployment rate for the year will be about 3.8 percent, compared to South Korea's 3.3 percent.
‧And the ratio of average incomes in the highest-20-percent and lowest-20-percent income brackets is 6:1 in Taiwan, while in South Korea it is 8:1.

Also according to the two organizations' projections for 2007, although Taiwan's nominal GDP per capita, at US$16,563, will be less than that of South Korea's US$19,921, when evaluated in terms of purchasing power parity (PPP), and discounting exchange rate fluctuations, Taiwan's GDP per capita figure is equivalent to US$31,041 while South Korea's is equal to US$23,331.

As of the end of last year, Taiwan's foreign exchange reserves amounted to US$266.2 billion, while those of South Korea stood at US$239 billion. Our government's outstanding debt-to-GDP ratio was 31 percent as compared to South Korea's 33.4 percent.

Furthermore, the 2007 World Competitiveness Report released by the International Institute for Management Development on May 10 this year ranked Taiwan 18th and South Korea 29th. Meanwhile, in the three major indices of the World Economic Forum's Global Competitiveness Report 2006-2007 released in September 2006—the Growth Competitiveness Index, the Global Competitiveness Index, and the Business Competitiveness Index—Taiwan ranked 6th (first in Asia), 13th, and 21st, respectively, while South Korea ranked 21st, 24th, and 25th.

As the aforementioned statistics and rankings demonstrate, Taiwan is no less impressive, economically speaking, than South Korea, both nations qualifying as an "Asian tiger" in terms of overall economic performance, government finance, domestic real purchasing power, and various competitiveness rankings.

Currently, Taiwan's production values in the important categories of large TFT-LCD flat panel manufacturing, contract IC chip-making, and IC packaging and testing rank first in the world. As of the end of August, this year's business turnover at Taiwan's three major science parks—Hsinchu Science Park, Central Taiwan Science Park, and Southern Taiwan Science Park—stood at NT$1.23 trillion [about US$37.88 billion]. This figure is expected to increase to a record high of NT$2 trillion [about US$60.6 billion] by the end of the year.

In the future, this administration will work to accelerate development of, and attract investment in, the newly expanded facilities of each science park. It will also work to promote precision machinery, communications electronics, and biotechnology to become Taiwan's third, fourth, and fifth trillion-NT-dollar industries, following the semiconductor and flat panel industries. It is hoped that this will help achieve the goal of balanced industrial and regional development within Taiwan. As for the stock market, which reflects our economy's prospects, the Taiwan Stock Exchange weighted index has risen about 25 percent from the beginning of the year, and the overall value of traded stocks has hit record highs.

As can be seen, far from falling out of the ranks of the four Asian tigers, Taiwan has become a leader in numerous high-tech realms. It has expanded beyond Asia to achieve a global presence. Given this shining record, I am confident that as long as we keep Taiwan in our hearts and have confidence in her, she will certainly have high visibility in the world.

At the same time that this administration has pursued economic prosperity, we have never forgotten to work toward social fairness and justice. Over the past year, especially since Premier Chang Chun-hsiung took office, we have been striving in that direction by pushing forward the "Big Investment, Great Warmth" plan. For the first time in a decade, we raised the minimum monthly wage by 9.09 percent, and the minimum hourly wage by 44 percent, from NT$66 to NT$95. Over 1.4 million workers are benefiting from these measures.

In addition, following the enactment of its organic law, the Labor Pension Fund Supervisory Committee was established, whose purpose is to enable 8 million workers to share in the fruits of economic growth and enjoy greater security in post-retirement life by "holding shares in Taiwan."

In the meantime, through cooperation between the ruling and opposition parties, the National Pension Act was enacted on July 20 of this year. It stipulates that a national pension system be launched on October 1 of next year, setting in place the final major piece of our social security network and transforming Taiwan into a modern welfare state.

Unquestionably, this is a landmark program designed to realize social fairness, justice, and solidarity. I would like to urge all of my government colleagues to complete all complementary measures, to ensure that the national pension system can be launched and become fully functional on time.

As for taking care of our farmers and fishermen, the Executive Yuan has raised the monthly payment to elderly farmers, from NT$3,000 to NT$4,000, then to NT$5,000, and recently to NT$6,000. It also approved a program for rebuilding rural villages and completed the drafting of the Farm Village Reconstruction Act. Once the law is enacted, NT$100 billion [US$3 billion] will be allotted to stimulate the rural economy, with priority given to improving the living conditions of disadvantaged citizens. Comprehensive programs will also be launched to beautify farm villages and improve their public facilities. To mitigate the impact of rising oil prices on the fishery industry, the Executive Yuan has approved a program to increase the subsidy for fishing boat fuel to 14 percent as of July 1 this year, while at the same time increasing subsidies for fishing boat insurance premiums.

With respect to helping disadvantaged groups, the Executive Yuan has also completed planning for measures to assist disadvantaged students, including tuition subsidies for children five years of age and under, and to expand assistance to the families of students of all ages. The measures will include the provisions of supplementary after-school tutoring for junior and elementary school students, as well as increased financial assistance for high school, vocational high school, technical college, and university students. An estimated 658,000 students will benefit from the new measures. Thereby, we hope to enable all young people to enjoy equal opportunity in and quality of education.

The Executive Yuan continues to provide assistance and guidance to small and medium-sized enterprises—the backbone of Taiwan's economy—with regard to finance, research and development, and management. On August 20, it appropriated NT$10 billion [US$303 million] from the National Development Fund to invest in small and medium-sized enterprises in cooperation with venture capital funds. This was the first time the National Development Fund departed from its focus on the domestic high-tech sector to invest in SMEs. It is anticipated that 1,000 enterprises will benefit and that 20,000 jobs will be created, injecting new vitality into Taiwan's economy.

With ongoing implementation of the three-pronged policy to assist Taiwan's central and southern areas, its middle and lower classes, and its small and medium-sized enterprises, this administration is on course to meet the goals of increasing investment in Taiwan, creating jobs, closing the gap between city and countryside, and reducing disparities of wealth. In addition to pursuing sustainable growth, we will work hard to build a "wellness economy" that accentuates Taiwanese characteristics and places emphasis on quality and human caring.

My dear colleagues and compatriots:

Tomorrow I will leave for the Second Taiwan-Pacific Allies Summit, to be held in the Republic of the Marshall Islands. Whenever I go abroad, far from home, it makes me realize the preciousness of my own country.

Taiwan and its Pacific sister nations—namely the Republic of the Marshall Islands, Solomon Islands, Republic of Palau, Republic of Nauru, Republic of Kiribati, and Tuvalu—share a deep kinship because we are all oceanic nations, and their peoples as well as our indigenous peoples are all Austronesians.

Since I became President, I have visited all of these nations and have witnessed their efforts in pursuit of prosperity, development, and happiness. When I compare what I have seen with what the 23 million people of Taiwan have undergone in the past half century, I know we should cherish even more what we have today.

In the past few years, Taiwan-born stars, such as Ang Lee, Wang Chien-ming, Chen Shih-hsin, Chu Mu-yen, Kevin Lin, Chan Yung-jan, and Chuang Chia-jung, have had stellar performances on the world stage and continue to bring honor to the nation. It is hard to put into words the pride we feel for their outstanding achievements.

At the same time, however, we feel deep distress when people, for political reasons and in pursuit of power, disparage Taiwan. For in denying Taiwan, they deny all the sacrifices and contributions made by the 23 million people of Taiwan for their nation over the past half century and more.

My dear fellow citizens, Taiwan is a success story. We should not underestimate and look down on ourselves. Taiwan is our homeland, our mother. It is the 23 million Taiwanese people's foundation and source of hope for development. If we lose Taiwan, we will lose everything. Taiwan has never been marginalized or ceased to be one of the four Asian tigers.

As long as we have Taiwan in our hearts, Taiwan will surely always be prominent. We, as her children, must work to strengthen ourselves and unite with a spirit of sincerity, and we must use our hard work, wisdom, and creativity to make her visible to the whole world.

In closing, let me wish you a happy Double Tenth National Day. May our great nation enjoy peace and everlasting prosperity. To all our distinguished guests, fellow citizens, and colleagues, may you enjoy good health and success in all of your endeavors. Long live democracy, and go, Taiwan!

Thank you.

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