Premier Yu Kuo-hwa and his delegation returned to the ROC on January 19 after a visit to the Bahamas, the Dominican Republic, and Guatemala. The group was not only met with impressive formal ceremony, but also local political leaders expressed great "personal friendship" toward the ROC and the Premier.

The results of this visit were more successful than anticipated. The originally planned activities--conferring honors, dinners, the exchange of diplomatic relations-- are naturally significant for their form. Nevertheless, both the ROC side and their counterparts, within these official forms, made efforts to cultivate deeper and closer friendship. And Premier Yu's disciplined "English gentleman" style won the respect of both his English- and Spanish-speaking hosts.

Add to this that the Taiwan development strategy proved of great interest to these nations. This is especially true when the ROC's society with its excellent distribution of wealth is compared to the large gaps between rich and poor in Central America.

Premier Yu emphasized what President Lee Teng-hui calls the "Taiwan Experience" in his talks with government leaders in the countries visited. He promoted the virtues of Taiwan's flexible, small and medium enterprise based economic structure. The Premier believes that this structure is not only the only way to maintain export led growth and adapt to changes in the international market, but is also the best locus of a stable society with an equitable distribution of income.

This small- and medium-sized base also happens to suit perfectly the ROC's "flexible diplomacy focussed mainly on aiding Southeast Asia and the Caribbean area" because Taiwan's development experience with small and medium sized enterprises can be used to help these areas implement economic and social reforms. No wonder leaders in the three countries continually expressed "envy" and hoped for "the aid of experience."

In fact, such aid has already begun. For example, ROC experts provided guidance for Guatemala's revision of its export processing zone management methods. The Bahamas and Dominican Republic can learn from the development of the communications industry in the ROC Such aid is a key to flexible diplomacy.

Based on his experience as economist, central banker, and now the highest ranking official in the executive branch, Premier Yu was able to grasp hold of this economic and diplomatic duality. The use of this economic power in diplomatic occasions was clearly a meaningful and effective strategy.

Naturally, there are no guarantees in diplomacy. Despite the success of this trip, because each country has different political and economic structures, the ROC's flexible diplomacy must become even more dynamic and vibrant.

First, in both Guatemala and the Dominican Republic there are large gaps between rich and poor, illiteracy is high, and the military retains considerable strength. Our relations with the Guatemalan military are excellent, but the achievements of the civilian government are hard to predict. If there is turmoil in society or the economy, the outcome will deserve close attention.

Second, promoting flexible diplomacy means accompanying it with substantive benefits. But our diplomatic units have been able to utilize public (like the "Overseas Economic Cooperation Fund") or private (such as the "Caribbean Area Investment Promotion") economic resources effectively to deepen relations in only a few cases. Premier Yu noted that aid is central to the ROC's playing an important international role; this calls for better coordination between top levels of economic and foreign policy agencies.

Third, many problems of economic aid involve not money but technology and skilled personnel. The ROC has done quite well in the area of agricultural technology; but if it can promote technology exchanges with small and medium enterprises, it can win more friendship and establish deep roots for "base level diplomacy."

As for overseas personnel, training is not yet practical, rotations are not able to increase career potential, and salary has suffered from the appreciation of the NT. These are all limiting factors for implementing the government's "extroverted diplomacy." On this trip, while the performance of diplomats overseas was in general exce arrangements. There is a need for an "organizational review" of practical actions of ROC diplomats. I suspect that it is not only the Central America embassies which are like this.

As for Premier Yu himself, though he is sometimes criticized as "conservative" at home, nevertheless his image as a banker and his careful, thorough work style are welcome attributes abroad. He certainly hopes to be able to use his advantages in diplomacy to increase room for maneuver as premier.