Sunday, January 4, 2009

Taiwan PAC-3 Sale Delayed: Reduction of Ballistic Missile Deployment Opposite Taiwan Imminent?

According to a Reuters newswire, MND's spokesperson MGen Lisa Chih announced that the People's Republic of China (PRC) may begin a gradual reduction in its short range ballistic missile (SRBM) deployments opposite Taiwan. No confirmation, but it's an interesting announcement. If true, such a move would be largely symbolic given the large number of launchers and missiles that are already in place, and in light of PRC deployments of land attack cruise missiles (LACMs).

The timing of a symbolic freeze or reduction of conventional ballistic missiles also could be interesting. First, the inauguration of President-elect Obama is just over two weeks away, and a goodwill gesture could be an attempt to cast China in a positive light as the new administration settles in.

The announcement also follows a series of public statements on both sides of the Taiwan Strait regarding prospects for cross-Strait military talks. The Ma administration's decision to scale back its annual Hankuang military exercise, holding it once every two years vice yearly. President Ma also made a public statement that hinted at the strong possibility of initiation of peace talks in the near future. Premier Liu Chao-hsuan also told the press that travel restrictions on active duty military personnel may be relaxed, ostensibly a requirement for MND personnel to be able to participate in meetings in the PRC.

The notion of a peace accord, which a reduction in the PRC's force posture theoretically could lead to, is nothing new. In an October 2007 New York Times interview, President Ma discussed the conditions under which he would engage his Chinese counterparts and enter into a "peace accord:"

We have always welcomed the idea of signing a peace accord with China and have been talking about this for the past seven or eight years. We have continued to appeal to China's leaders and government to sit down and have a dialogue on the establishment of a framework for peace and stability. Should a consensus be reached, we could then sign a peace accord and other related agreements. However, we oppose any preconditions or framework being set and any conclusions being reached prior to discussing an agreement. We are even more opposed to missile threats or the use of non-peaceful means or military force to coerce any party into signing a peace accord.

I detailed this concept in my 2000 inaugural address, when I said that as long as China does not intend to use force against Taiwan, then I would honor my "Four Noes" pledge. But today, the international community only pays attention to the proposal made by Hu Jintao regarding a peace agreement, and overlooks the precondition that Hu laid out--that such an agreement would be possible only if it was signed within the "one China" framework.

One, China must openly renounce the use of force against Taiwan. To this end, it must remove the 988 ballistic missiles it has deployed along its southeast coast targeted at Taiwan. Two, China must repeal its so-called "anti-secession law," which represents an attempt to lay a legal basis for a future invasion of Taiwan. Three, and most important, China must give up this notion of the "one China" framework it has insisted upon. In this light, it is very clear now that if we were to sign such a peace treaty under the framework of the "one China" principle, then I think this would mean, for the 23 million people of Taiwan, a treaty of surrender.

Of course, this statement may be pre-election rhetoric, and conditions for entering into negotiations may have evolved since October 2007. However, in his 2009 New Year's address commemorating the 30th anniversary of the PRC's January 1979 Message to Compatriots on Taiwan, Chinese President Hu Jintao echoed Ma's call for initiation of talks that could lead toward some form of peace agreement.

Finally, a symbolic freeze or reduction of ballistic missiles opposite Taiwan coincides with a delay in consummating a letter of offer and acceptance (LOA) for procurement of PAC-3 missiles and additional PATRIOT fire units. The Bush administration notified Congress of its intent to sell as many as 330 PAC-3 missiles and four additional fire units in October last year. The total value, if all options were to be exercised, is as high as U.S. $3.1 billion. Since October, a jump in unit cost for the PAC-3 missile is said to be holding up a signed LOA, which ultimately could lead to a reduced procurement. In an 8 Dec 08 Taipei Times editorial, John Tkasic noted Legislative Yuan members citing as much as an additional US $800 million has been added into the draft LOA, a major jump above previous quotes. Other sources have noted that PAC-3 unit cost has risen to as much as US $5.9 million, a significant jump from previous years. The rationales given for the higher price tag include "research and development" costs and "non-recurring engineering."

Lockheed Martin Missiles and Fire Control, headquartered in Dallas, Texas, is the prime contractor for the missile. Its Camden, Arkansas manufacturing facility (formerly under Loral Vought Systems), employing over 450 people, is responsible for missile integration and assembly. Boeing’s Air & Missile Defense System in Huntsville Alabama, supported by its Anaheim, CA facility for program management and design support and its El Paso facility for circuit cards, is responsible for the missile seekers. Aerojet, headquartered in California and with facilities in Virginia and Arkansas, produces both the solid rocket motor for the missile boost and the individual attitude control motors for homing guidance maneuvers during flight.

Raytheon is the prime contractor for PATRIOT ground systems, as well as the 200 some odd PAC-2 Guidance Enhanced Missiles (GEMs) that Taiwan currently has in its inventory. In 2007, Raytheon captured a program valued at between US $500 and $900 million to upgrade Taiwan's existing three PATRIOT fire units in the greater Taipei area. Raytheon also is supporting the US Air Force's Electronic Systems Command (ESC) in the development, manufacturing, and installation of a large UHF phased array array radar for early warning of ballistic missile attacks, as well as monitoring of air activity in the Taiwan Strait. However, the radar program, which the USG approved in 2000 and contracted in 2005, has experienced significant delays.

Should disagreements over PAC-3 unit costs continue, there could be an indefinite delay in concluding an LOA. The Ma administration, and/or a Democratic administration that has long been skeptical about missile defenses, may be thinking about ways to reciprocate for China's symbolic gesture. PAC-3 missiles could be the bargaining chips.

However, MGen Chih asserted that "we would look favorably at this development (in China), but we need to work on our own safety and not rely on someone else's goodwill." She added "we won't relax our own preparations."

More commentary on this later...

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