from Reuters, 2000-Mar-21:

Taiwan parliament drops trade ban

[Taipei] Taiwan's parliament on Tuesday dropped a five-decade-old ban on direct trade and transport links between the island and mainland China, a legislator said.

Direct links would be approved between Taiwan's offshore islands of Quemoy and Matsu and the Chinese cities of Xiamen and Mawei facing them across the narrow Taiwan Strait.

The measure was approved at a parliament session and does not need government approval.

Parliament also approved direct postal links. It was a dramatic goodwill gesture following the election as president on Saturday of Chen Shui-bian, whose party in the past has openly advocated independence.

A flourishing smuggling trade already exists between the islands and the mainland, with legitimate trade and investment now mostly channelled through Hong Kong. Taiwan companies have invested up to $40 billion in China.

''Passage of this legislation gives legal basis for three direct links between Quemoy and Matsu and mainland China before such links are allowed on the Taiwan mainland,'' Nationalist lawmaker Chen Ching-pao said.

''In other words, Quemoy and Matsu can replace Hong Kong to become conduits between Taiwan and mainland China,'' he said.

A mainland Foreign Ministry spokesman gave a muted response to the historic move.

''We have taken note of that,'' said spokesman Sun Yuxi and declined to comment further.