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CHINA issued a mixture of threats and blandishments to Taiwan yesterday in a speech marking the first anniversary of Jiang Zemin's eight-point plan for reunification.

President Jiang himself was absent from the top level conference at which premier Li Peng gave the keynote speech.

Mr Li reiterated a standing threat to invade, promised to make Taiwan master of its own destiny, inveighed against President Lee Teng-hui and warned foreign powers to stay out of this 'internal' quarrel.

Despite reports that China had drawn up a timetable to resume sovereignty of Taiwan, Mr Li gave no details of China's plans.

 But he stressed that China would not allow Taiwan's March presidential election, which is expected to return Mr Lee to power, to be used to change the island's status.

 Beijing would also continue to discourage voters from choosing pro-independence candidates in the island's first fully-democratic presidential election.

 'Whatever changes might occur in the way in which the leadership in Taiwan is chosen, they cannot change the fact that Taiwan is a part of China and its leaders only leaders of a region in China,' Mr Li said.

However, he stopped short of repeating the invective heaped on President Lee after his private visit to the United States last year.

'It will lead nowhere if some people use the change of Taiwan leaders as an excuse to put their separatist activities in a legal guise,' he added, placing responsibility for the crisis on the other side.

Mr Li warned that China had not 'forsworn the use of force' but insisted that 'this is not directed at our Taiwanese compatriots but at foreign forces who attempt to interfere in China's reunification and those who seek independence'.

 'The reunification of the motherland is exclusively China's internal affair, in which no foreign force may interfere in any way,' he said in remarks particularly directed at Washington that suggest absorbing Taiwan will become Beijing's top priority after 2000.

'During the period of the Ninth Five-Year Plan, the Chinese Government will resume the exercise of sovereignty over Hong Kong and Macau. Therefore, settling the Taiwan issue will be prominently put in front of all Chinese people.' Mr Li went on to blast the 'perverse acts' of some leaders in Taiwan and accused them of deliberately creating a false impression of improving relations with the mainland while stockpiling military equipment.

'This demonstrates they have been plotting independence under the pretext of detente,' he said.

His comments came as the Chinese Foreign Ministry indirectly criticised Washington for the passage of the aircraft carrier USS Nimitz through the Taiwan Strait on December 19.

 'The Taiwan Strait is for international navigation. All foreign warships can exercise the right to innocent passage,' said spokesman Chen Jian.

 'But in view of the current special situation in the Taiwan Strait, it is needless to say that we are highly concerned for warships' passage through these waters.'  Virtually all of Taiwan's major political figures rejected Mr Li's claim that the island belonged to China.

 Stating that Taipei was also pursuing unification, Kao Koong-lien, acting chairman of Taipei's official Mainland Affairs Council, said Beijing was equating the People's Republic of China with China and claiming that Taiwan was part of it.

 'We absolutely cannot accept this. The People's Republic of China has no right to represent all of China and nor does it have sovereignty over Taiwan,' he said.

  The presidential election was a democratic action and had nothing to do with Taiwan independence.

 'Any such distortion of Taiwan's democratisation exposes their fear of democracy and freedom,' he said.

  President Lee did not comment on the premier's speech, but all the island's other presidential candidates rejected Mr Li's claim.

However, investors on the Taipei Stock Exchange responded favourably to Mr Li's comments, with the market rising 111.5 points to finished at 4,803.80.

The market plunged over 160 points on Monday after Hong Kong newspapers suggested Mr Jiang would issue a timetable for unification.



Taiwan is ours, says Li