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Discovering Xiamen
Special> China International Fair For Investment & Trade> Discovering Xiamen
UPDATED: August 12, 2009 Web Exclusive
Letting Go of the Past
Dadeng Island, a former battle frontier gears up for renewed cross-Strait trade

The summer heat in the coastal city of Xiamen, southeast China's Fujian Province, not only comes from the weather, but also is intensified by tourism. Tourists from all over the world enjoy their vacations here, including the relatively remote Dadeng Island.

Located in the southeast waters of Xiamen's Xiang'an District, the Dadeng Isles are comprised of three islands—Dadeng, Xiaodeng and Jiaoyu. Known as the Three-Hero Islands, they cover an area of 13.2 square kilometers, with a population of approximately 20,000 people. It is the closest area on the Chinese mainland to Kinmen of Taiwan—the two places stand face-to-face across the Taiwan Strait, with the shortest distance less than 2 kilometers.

Kinmen used to be the then Kuomintang regime's forefront of military antagonism against the Chinese mainland after the founding of the People's Republic of China in 1949. Tensions escalated in August 1958, with Kinmen and Fujian Province bombarding each other with thousands of shells.

Three-Hero Island Park in southeastern Dadeng was crumbled to dust after the August 1958 battles, but has now become a patriotism education base and a scenic spot. The weapons exhibition, tunnel fortification and gunfire ruins at the park are reminders of the cross-Strait tensions at the time. But a nearby trading market presents a striking contrast to the solemn and gloomy park, since it is the only one on the Chinese mainland to trade petty commodities with Taiwan face-to-face.

Dadeng and Kinmen have nurtured close trade ties since ancient times. In fact, many residents in Dadeng had relatives in Kinmen with whom they traded commodities across the Strait. Unfortunately, Dadeng became the forefront of cross-Strait tensions immediately after the founding of the People's Republic of China in 1949. Cross-Strait trade in the area was inevitably affected. As cross-Strait tensions eased in the 1980s and 1990s, fishing boats from Taiwan reached Dadeng frequently; people-to-people trade resumed spontaneously and gradually gained momentum.

In 1998, the Dadeng Cross-Strait Petty Commodity Trading Market was established with the approval of China's State Council and the Central Military Commission. The initial business area covered 122 mu (about 1,830 hectares), 10 percent of the total 0.85 square kilometers, with 504 booths and a total investment of 45 million yuan ($5.63 million). It aimed at regulating petty commodity trade, enhancing cross-Strait exchanges, pushing forward economic development and, more importantly, facilitating business between the two sides, particularly Taiwanese businessmen and enterprises on the Chinese mainland.

The market made it possible for local residents from both the Chinese mainland and Taiwan to start up small businesses. Legal trading in Taiwanese commodities consisted of six categories--food and oil, native and livestock products, textiles and clothes, handicrafts, light industrial products, and medicines.

Since May 1, 1999, the market has been on the right track after going through various challenges, and now has a bigger scale and more influence.

According to Yang Deping, head of the general office of the market's Administrative Commission, in 2008 alone, the market's gross trade volume hit 386 million yuan ($55.4 million), and the volume of imported Taiwanese goods amounted to $19.2 million, compared with merely 124 million yuan ($16.5 million) and $2.746 million, respectively, in 2001.

Yang said all preferential policies and service agencies were included in the planning program at the initial stage of market construction. In 1999, for instance, the Xiamen Government issued a managing regulation for the market--cumulative total trade of imported Taiwanese goods under and including 1,000 yuan ($127) would enjoy a duty-free policy. In 2007, the approved standard rose to 3,000 yuan ($429). The move, in Yang's view, has "largely stimulated trade."

In fact, the initial development of the market was not quite smooth--cross-Strait relations became strained in the late 1990s, when the then Taiwan leader Lee Teng-hui in an interview with Deutsche Welle defined cross-Strait relations as "state-to-state, or at least special state-to-state relations." The Chinese mainland objected to his characterization.

Under such circumstances, Taiwanese boats were forbidden from landing on the Dadeng shore. Instead, trade between the two sides could at best take place at sea. Consequently, the Dadeng market faced a gloomy situation in which only 70 to 80 booths out of 504 ran businesses at the time. Fortunately, the market is now back on the right track thanks to the normalization of cross-Strait relations in recent years.

Dadeng is now the frontier and pioneer area in cross-Strait exchanges, especially after the realization on December 15, 2008 of the "three links"--direct postal, transportation (especially airline), and trade links between the Chinese mainland and Taiwan.

"Since the Chinese mainland has opened up further and deeper, we sincerely welcome business and investment from Taiwan," Yang told Beijing Review.

The First Cross-Strait Forum was held in Xiamen in May this year, which was also a grand meeting for both sides with the most people and the largest scale. According to recently issued plans, Dadeng has been chosen as the location for future Cross-Strait Forums, which indicates the unique significance of Dadeng Island in cross-Strait relations.

In the wake of new development momentum, the Xiamen Government has already decided to renovate and expand the market, expecting it to become the biggest theme park and industrial base for trade and tourism across the Strait. The market will also improve cross-Strait exchanges and push forward Xiamen's development.

At present, Xiamen is accelerating the construction of a sea tunnel connecting Xiamen to Dadeng Island. The estimated travel time will be halved to only 30 minutes when the tunnel is completed by the end of this year. With the influx of tourists to Xiamen, a better Dadeng market will embrace a brighter future.

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