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CEOs to D.C.: Get Real on Asia

MANY CEOs SPEND TIME on the ground in Asia and understand how geopolitical realities are shifting. Yet one gets the …

MANY CEOs SPEND TIME on the ground in Asia and understand how geopolitical realities are shifting. Yet one gets the sense that policy-makers in Washington, of both Democratic and Republican ilk, still see Asia through decades-old prisms.

A case in point is Taiwan. The reality is that at least 1 million Taiwanese work on the mainland and the island is integrating its economy with China’s. One of the last taboo sectors, semiconductors, is in fact moving to the mainland.

So the chances that Beijing is going to launch a military attack on Taiwan are infinitesimal. Plus, Beijing is hosting the Olympics in 2008. So much of the belligerent posturing we hear from both sides is just that, posturing. The goal for the U.S. should be to let the Chinese on both sides of the Taiwan Straits sort out their disagreement by themselves peacefully over time. Washington shouldn’t be destabilizing that process by dramatically raising its level of military support for Taiwan.

Elsewhere, the Bush administration has attempted to isolate North Korea. But no one else in the region wants a collapse. South Korea is opening up modest tourism and economic links. Japan, which is home to roughly 700,000 ethnic Koreans, many pro-North, serves as an economic conduit for the North. It doesn’t want to see a collapse. Nor does China, which fears a human tidal wave across the Yalu River. To be sure, the Koreans, Japanese and Chinese don’t agree on a final outcome: The Koreans want reunification, but neither Japan nor China desire a strong, unified Korea. But the U.S. is isolated in pushing confrontation, particularly now that it is reducing its military forces.

CEOs who have Asian savvy ought to help the new administration break out of the Cold War approach to Asia and recognize the new economic and political realities. Your long-term business interests in the region just may be at stake.

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