HONG KONG -- The conciliatory inaugural address May 20 by Taiwan President Chen Shui-bian, taken together with a major statement a few days earlier by Beijing, show that both Taiwan and mainland China are eager to avoid a confrontation. It is now conceivable that, given good will and flexibility on both sides, they may be able to edge away from a confrontation.

In his speech, Chen voiced understanding of Beijing's insistence on its "one China" principle, even though he made it clear that Taiwan could not accept it. However, he spoke intriguingly of the European Union, which, he said, "has successfully integrated the common interests of the people of Europe." The EU's experience "has far-reaching implications," he said, and the trend toward regional integration "has led to fundamental changes in the conventional thinking of national sovereignty and territorial boundaries."

In his speech, Chen said that, given the consent of the Taiwan public, in the future "the Republic of China and the People's Republic of China -- or Taiwan and China -- can seek to establish relations in any form whatsoever."