China is on the ‘charm’ offensive to rein in Taiwan.
Last week, James Chou, deputy director general of the Taiwanese Ministry of Foreign Affairs, stressed that the disputed islands of the South China Sea were the “undisputed territory” of the ROC. Additionally, Chou expressed a strong desire for the ROC to take part in any multilateral mechanism in resolving the long-standing territorial impasse. He said any resolution of the conflict that did not involve the ROC would be “regrettable”.
Chou’s assertion of the “undisputed” nature of Chinese sovereignty in the area echoed the recurring message of the Foreign Ministry of the People’s Republic of China. Both the mainland-based PRC and the ROC maintain the same “nine-dotted line” claim to the vast majority of the South China Sea. It is important to note that the current official policy of both Taipei and Beijing is that there is “one China”, and both governments strongly agree on Chinese sovereignty in the South China Sea. The pivotal disagreement of cross-strait relations hinges on which of the two governments is the legitimate ruler of China itself.
Even more interesting, a high-ranking government official in Taipei has recently called for a ROC-PRC economic alliance in the South China Sea. Chiu Yi, an important member of Taiwan’s ruling Kuomintang (KMT) party and an executive in the state-owned energy company CPC, has called for open cooperation between the PRC and the ROC in extracting resources from the disputed waters: “The seabed around Taiping Island has abundant reserves of oil and natural gas … The merit would be great if a cross-strait joint development project is done.” 
The ROC Foreign Ministry’s recently stated desire to participate in any multilateral mechanisms for resolving the maritime dispute is particularly telling. Beijing’s insistence on a strict “one China” policy has excluded Taipei from most international organizations. However, Taipei’s participation in a multilateral, negotiated settlement to the South China Sea impasse would likely strengthen the joint Chinese claims of sovereignty over key islands.
Rumors are now circulating of a grand bargain being negotiated between Taipei and Beijing. Joint PRC-ROC cooperation in the South China Sea may be exchanged for Beijing’s approval of Taipei’s participation in some international organizations. Issues of sovereignty would need to be carefully addressed in any deal, but the potential for mutual benefit is significant.
Joint PRC-ROC cooperation in the South China Sea would also pose a significant challenge for US policy. The US government has been strengthening military ties with the Philippines and Vietnam with the unstated aim of containing Chinese ambitions in the area. Meanwhile, Taiwan has long been a US ally. If Chinese nationalism remains politically ascendant in Taiwan, and a joint PRC-ROC alliance is formed in the South China Sea, the US will find itself in a very awkward position.
Full article: Taiwan jumps into South China Sea fray (Asia Times Online)