Taiwan deal may sour China's ties with US

Angered by the arms sale to Taipei, Beijing announces suspension of military exchanges with Washington and talks on security issues.

China's sharp reaction to a newly announced US arms sale to Taiwan has sparked concern that the fallout could affect broader US-Chinese relations, including recent talks to impose new sanctions on Iran and negotiations with North Korea.

After it was informed of the arms deal, worth US$6.4 billion (Dh24bn), on Friday, China announced suspension of military exchanges with the United States and security talks on a broad range of issues, including arms control and nuclear non-proliferation. "Co-operation between China and the US on key international and regional issues will also inevitably be affected," a statement from the Chinese foreign ministry said. "China will also implement relevant sanctions on US companies involved in the arms sales to Taiwan."

China temporarily suspended military relations with the United States in 2008 after a similar arms deal with Taiwan, which Beijing considers to be a province. The United States committed to supplying arms to Taiwan under the Taiwan Relations Act of 1979. The recent package includes Black Hawk helicopters, Patriot missiles, communications equipment and mine-hunting ships. The Chinese vice foreign minister, He Yafei, said the United States would be responsible for "serious repercussions" if it did not reverse the decision.

The tough Chinese stance comes as the two countries have feuded recently over free speech issues. Google, the California-based internet company, recently threatened to pull out of China citing concerns about government internet censorship policies and cyber-attacks on its computer systems aimed at Chinese human rights activists. Tensions between the two superpowers were already strained on a variety of fronts, including climate change and a dispute over the Chinese currency. Such tensions were expected to flare next month when Tibet's spiritual leader, the Dalai Lama, visits Washington.

Still, the United States is hoping to persuade China to agree to a fourth set of UN sanctions against Iran, something it has been reluctant to do because of deep economic ties to the Islamic republic. China imports significant quantities of Iranian oil and has sizeable investments there. Jing-dong Yuan, a non-proliferation expert at the Monterey Institute of International Studies in California, said the dispute meant Washington "should forget about" Chinese support for more sanctions against Tehran.

"Even before the arms sale, China was reluctant to agree to additional sanctions because of its significant economic stakes in that country," he said. Mrs Clinton met Chinese officials to discuss further Iran sanctions recently and described the meetings as positive. Bonnie Glaser, a China expert at the Center for Strategic and International Studies in Washington, said she expected Beijing to stay engaged on Iran, but there was a risk China could overplay its hand out of anger over Taiwan. "There is a sense in China that their leverage over the United States and their position in the world is growing, and in that sense there might be a little bit of overreaching."

Taiwan split from the mainland at the end of China's civil war in 1949, but Beijing views the island of 23 million as part of its territory that must be reabsorbed. It has hundreds of missiles targeted against Taiwan. China's state-run media was mostly mum on the rift yesterday, but the Xinhua news agency said in a commentary that the world needed "healthy, stable and developing China-US ties", saying the two countries had many "common interests".

Washington also had hoped that the Chinese president Hu Jintao would attend Barack Obama's nuclear security summit in April. Now some doubt that Mr Hu will be there. A spokesman for the US state department, Laura Tischler, said the administration was disappointed by Beijing's response. "We regret that the Chinese side has curtailed military-to-military and other security exchanges. We also regret Chinese action against US firms transferring defence articles to Taiwan," she said.

"The US government's decision to sell Taiwan defensive arms is based upon our evaluation of Taiwan's defence needs," she added. "We believe it contributes to maintain security and stability across the Taiwan Strait." In a briefing on Friday, a senior administration official cited the "very mature relationship" between the United States and China. The official also minimised the affect that the arms deal will have.

"We think we can get through issues like this. We have a lot of other issues with China and other common interests that will continue - we expect we'll continue to explore with them," the official said. [e-mail] * With additional reporting by Agence France-Presse