Ⅰ. Review and Outlook of the Situation at Home and Abroad

1. The International Situation

--Thanks to the assault of modern-day free thinking and the aspirations of satellite nations for democracy, the Soviet Union has had no choice but to alter its global strategy and seek detente with the countries of the West to avoid further isolation. As a result, breakthroughs have been achieved in nuclear arms talks, the Soviet Union has withdrawn troops from East Europe, and there has been an easing of regional military conflicts.

--Since Mikhail S. Gorbachev began advocating glasnost and perestroika, several of the Communist nations of East Europe have been emerging from long years of closure and isolation. Opposition forces have been permitted to take part in elections in Poland and Hungary, and in Poland a cabinet has been formed of non-Communists and openly demanded establishing equal bilateral relations with the Soviet Union, developments which are having a profound and far-reaching effect on Communist countries around the world.

--At Gorbachev's summit meeting in mainland China, the Soviet Union agreed to withdraw troops from Outer Mongolia and the Sino-Soviet border, and future developments and the reaction of the Chinese Communists have aroused the concern and attention of the whole world.

--As military confrontations gradually ease, peaceful contests among nations will become more intense, and economic and trade competition will become a challenge faced by every country. The formation of regional economic organizations that is now in the ascendant will certainly create trade barriers, deepening the intensity of competition.

--The effect of newly industrialized countries entering the international trade battlefield with their rich forces in the future cannot be overlooked.

--The foreign debt of the Third World continues to grow, forming another variable that is deeply troubling to all countries of the world.

Faced with the new international situation, we must apply our national strength toward creating opportunities for breakthroughs, expanding friendly relations, opening up diplomatic space, raising our ability to compete, and maintaining stable growth in international trade. Those are the tasks we must actively plan for at present.

2. Mainland China

--Although the Communist regime has been striving to carry out economic reforms to stave off the collapse of its economy, its adherence to autocracy in government has caused its economic reforms to show poor results. Its stumbling reform measures have given rise to such adverse side effects as graft, corruption, and soaring prices at the same time as they whetted the ardent hopes of the people for complete reform, resulting in the mass movements in Tienanmen Square.

--The bloody suppression in Tienanmen Square not only exposed the true nature of the Communists' tyrannous regime, it also pointed up the internal contradictions among the political ruling class. Although the fourth plenum of the Communists' thirteenth national party congress held at the end of June superficially dampened intraparty fighting, it in no way eliminated the utter despair of the people in the entire Communist system. The outlook for the Communists' economic reforms in the foreseeable future is dim, owing to sanctions by the countries of the world and the passive resistance of our compatriots on the mainland, and internal struggles will flare up again at high levels with even greater intensity.

--The fleeing overseas of mainland intellectuals, the defection of Chinese Com munist personnel stationed abroad, the renunciation of party membership by overseas mainland students, and flights to freedom by Communist air force pilots all show that the Communist regime is besieged by crisis and the day of its thorough defeat is not far off.

--Exiled pro-democracy figures from the mainland have formed a foundation that has obtained a broad response from overseas mainland students and scholars, and their vital national spirit and determination to struggle are hastening the fusion of anti-Communist forces at home and abroad. The Communist regime will have to pay the price for its butchery and tyranny.

As to the situation on the mainland, the "Taiwan experience" created by the government and citizens of the ROC must serve as beacon for future change on the mainland, and guiding the mainland back toward the proper course of democracy and freedom is the common responsibility of the government and the public. Our policies must be broad in spirit, our attitude must be compassionate in feeling, and our work must be positive and practical in method. With the concerted efforts of the government and the public, the task of reunifying the nation can be completed.

3. The Bastion for National Recovery

--Politically, we must preserve and protect our system of constitutional government while seeking to carry out full democracy. Allowing the establishment of new political parties and the registration of new newspapers has created a scene of great vitality, at the same time as political operations and activities have tended toward reason and harmony. The upcoming elections will increase the number of seats in the Legislative Yuan and raise the vitality of the National Assembly.

--In diplomacy, we have actively striven to break out of isolation and have achieved notable results.

--Economically, prices have been stabilized and the money supply has been effectively controlled. Economic growth is expected to reach seven percent this year, foreign trade to surpass US$130 billion, and the per capita gross national product to approach US$7,000.

--In social welfare, we are expanding the scope of insurance; advancing welfare measures for children, the elderly, and the disabled; and strengthening work in medicine and environmental protection.

--In culture and education, we are improving public education, increasing opportunities for higher education, expanding adult education, and assisting private schools and guiding their development.

Rather than attempting to go into all of the government's programs one by one, I have provided a written report with detailed contents to each Legislative Yuan member for reference. It cannot be denied, however, that the development of various aspects of society has brought about a number of problems that have not as yet been completely solved. For example, the adjustment of the adaptability of various government systems has not yet been completed, traditional rules of politics have been subject to strong attack, and the behavior standards of a democratic society have not yet been firmly established, leading to incidents of anomie and disorder. The development of society in a pluralistic direction and the government's ability to adapt to a changing situation must be strengthened. The public consensus with regard to national development is inadequate, creating confusion and differences in value concepts that have led to a deterioration in law and order, urban traffic congestion, soaring realty prices, serious environmental pollution, rampant economic speculation, insufficient recreational facilities, and a widening gap in the distribution of wealth. These are the objects of public dissatisfaction and castigation. We must face all these serious problems with endurance and determination. We must eliminate corruption, do away with special privileges, and pursue the public interest without regard to private concerns, valiantly advancing to meet the challenges and overcome the difficulties ahead. Just as President Lee Teng-hui directed, "The administration of the government must have fervor; only then can it cope with the challenges of the times." So since being appointed to serve in the Executive Yuan, I have asked the entire personnel of the administration to strive together for openmindedness, probity, initiative, and efficiency, and I hope each one of you in the Legislative Yuan can give us your strong support.

Ⅱ. Implementation of the Four Major Administrative Programs

In my June 13 report to the Legislative Yuan, I named (1) pursuing the realization of full democracy; (2) expanding the scope of services to the public; (3) steadily advancing our work with regard to the mainland; and (4) actively promoting national construction as the future directions of our administrative work. During the three months since then, I have been constantly engaged in studying, planning, and promoting work toward those programs, holding numerous ad hoc meetings with in-depth discussion at the Executive Yuan, meeting with various agencies of the Executive Yuan to propose concrete administrative plans, and holding seminars for management personnel in the Executive Yuan to develop a consensus and put team spirit into play in striving together to implement the administration's policies.

1. Seeking the Realization of Full Democracy

Thoroughly carrying out a constitutional, democratic government has been our persistent aspiration. The series of political reforms that the government has pushed forward over the past two years--including the lifting of martial law, the lifting of restrictions against new newspapers and new political parties, guaranteeing the rights of assembly and demonstration, and reforming the Law of Election and Recall of Public Officials--have made our democracy ever more sound and mature. Concrete achievements include:

--As of the present, 225 newspapers have been registered with the government for distribution, among which 109 have already been published. Freedom of the press has become a fact acknowledged by all.

--Since the Civic Organizations Law was promulgated early this year, 37 political parties have been legally registered, laying a fair and rational basis for multiparty politics under the rule of law.

--The promulgation of the Law on Assemblies and Parades has provided rules to follow for public assemblies and demon strations. Since the law was put into effect, 2,583 outdoor assemblies and demonstrations have been legally held, showing that legal guarantees of the people's freedom of expression are complete.

--The revision to the Law of Election and Recall of Public Officials has further expanded the space for election campaigns and increased election fairness.

--Following the elections at year's end, there will be thirty more supplementary legislators joining the Legislative Yuan and improvements in the structure of the National Assembly to raise its vitality can be foreseen.

--The principles for tax receipts and allocations are being studied for improvement to supplement local financial resources and strengthen local development.

--The Bureau of Investigation in the Ministry of Justice has set up a department to eliminate graft and corruption so that an image of clean and able government can be built up.

--The administrative plan to rectify and clean up elections is being implemented with strictness to prevent the incursion of bribery and violence and make sure that the three elections at year's end are carried out in a manner that is fully fair, impartial, and open to the public.

2. Expanding the Scope of Services to the Public

That the interests of the public should be considered in government work at all times is a fundamental principle of democracy. The Executive Yuan's program to ensure that agencies at all levels pay attention to strengthening service to the public has been quite effective in improving their service attitude and raising administrative efficiency. Along with constant advances in society, however, public expectations of the government are continually being raised. Since taking office, I have specifically asked agencies at each level to attach great importance to public response and expand their scope of services to the public. The main courses of action are:

--Holding lectures and study groups with government workers at all levels to establish correct service concepts and improve service attitudes, advancing from eliminating measures that inconvenience the public to loving and caring for them.

--Suggestions from organizations that represent the will of the people must be handled by administrative agencies on an individual basis, with a timely and effective response strictly demanded.

--Public opinion and the aspirations of the people must be viewed with importance and concern. Basic-level units especially should actively work at all times to solve the public's problems and difficulties.

--Two-way communication channels between the government and the public must be established and constantly maintained; public opinion surveys must be held regularly to learn about the needs of the people; and the propagation of government measures must be strengthened to win the support of the public in establishing a new government image of openmindedness probity, initiative, and efficiency.

--Scientific tools must be utilized in conjunction with up-to-date information systems to accelerate the efficient handling of public applications.

3. Steadily Advancing Our Mainland Work

"Building up Taiwan to recover the mainland" is a fundamental government policy. With the chief goals of our political call to the mainland being democracy, freedom, unification, and prosperity for all, we must advance our work in a steady, active, and positive manner while paying heed at all times to the political, economic, and social situation. The broad exchange and contacts engaged in by people on either side of the Taiwan Strait during the past two years through international conferences, athletic events, visits to relatives, postal communications, and telephone calls have shown widespread longing for the "Taiwan experience" among our compatriots on the mainland and have proved the correctness and farsightedness of our mainland policy.

The government began allowing visits to relatives on the mainland in November 1987, and during the past half year the Executive Yuan's Mainland Affairs Council has pushed forward a number of major measures that have all had a positive effect:

--Permitting the resettlement to Taiwan of former military personnel and their families left on the mainland.

--Allowing the faculty and staff of public schools to visit their relatives on the mainland.

--Permitting members of the mass media to travel to the mainland to report stories and produce films and television programs.

--Opening up indirect telephone calls for people on the two sides of the Taiwan Strait.

--Improving steps for postal correspondence with the mainland, making it faster and more convenient.

--Allowing civic groups to travel to the mainland to take part in international conferences and athletic events.

Following the Tienanmen massacre, the government repeatedly issued solemn statements condemning the Communists' brutality and calling for sanctions from the international community, and it issued a series of measures in support of the mainland democracy movement to provide prodemocracy figures from the mainland with moral and material support through various channels. Our major courses of future action are:

--Establishing an order of priorities for further liberalization measures with a responsible, steady attitude and flexible, expedient methods.

--Establishing temporary provisions for relations between people of the areas of Taiwan and the mainland in adherence with established policy to set up a legal framework for nongovernmental contacts across the Taiwan Strait.

--Strengthening the functions of the Mainland Affairs Council, raising its responsibilities, and studying the establishment of a private intermediary organization to handle affairs related to nongovernmental contacts across the Taiwan Strait.

--Continuing to expand the "Taiwan experience" to spur the mainland to effectuate at an early date such liberalization policies as democracy, economic freedom, social equality, and freedom of public opinion.

4. Actively Promoting National Construction

National construction is a never-ending task, in which our efforts of the past have left a shining record for history. The ten, twelve, and fourteen major development projects that the government has promoted over the past ten-plus years for steady economic and social development have all been key programs closely involving the national economy and the people's livelihood. On this basis we will continue to map out a long-term national development strategy, to be incorporated in our administrative programs each year and carried out with tight planning and management as we stride toward new goals.

In my policy report to the previous legislative session I listed eleven key administrative areas. Today I would like to report on the state of implementation of each area over the past three months. A separate booklet has been compiled on related plans and programs for your reference. [For details on the implementation of the eleven key areas, please see the article "So Proudly We Hail!", p. 11.]

Ⅲ. Conclusion

The four major programs and eleven key areas reported on above are the most salient of the government's current administrative plans, aimed in essence at outlining a blueprint for future national development, and I hope you will be unsparing in your criticism and suggestions with regard to any points that may be inappropriate.

Members of the Legislative Yuan: This year is the fortieth anniversary of the fall of the mainland. Many of us still recall that time just after the government moved to Taiwan, when aid from the international community had been cut off, when everything on the bastion of national recovery was waiting to be done, when the Communists across the strait clamored to "wash Taiwan in blood," when the storm raged for a time, and the situation was precarious. History proves that only a nation that has withstood the trials and tempering of time can long endure. Through our toil and labors over the past forty years, we have not only stood up and forged our own path but have earned the admiration of our compatriots on the mainland and the respect of countries around the world. Before us we see the key moment when the darkness of night is coming to an end and the dawn is about to break, but we also know that the march along the road to success is not easy going. Full of confidence and high in morale, relying on wisdom and informed judgment, let us contribute toward the advancement of the national interest and the welfare of the people. What history asks of us is this: that we neither shame our forebears before us nor dishonor posterity after us.

Members of the Legislative Yuan: Shortly after assuming office as premier, I called on the personnel of the Executive Yuan to "show devotion and dedication; success or failure lies in unity." Today I would like to encourage each of you and each of my fellow citizens to act in the same way. If only we work together and go forward in concert, I am certain we can write another glorious page in the history of modern China.

[Picture Caption]

Premier Lee Huan viewed his administrative report to the Legislative Yua n with great seriousness and did a lot of homework beforehand.

Premier Lee freely discussed the international situation with several members of the foreign media he received during this year's national day celebration. (photo by Vincent Chang)

The ROC has achieved a number of major advances in diplomacy recently. Shown here is the president of Guatemala accompanied by Premier Lee on a tour of Nine Tribes Cultural Village during his recent visit to Taiwan.

Premier Lee freely discussed the international situation with several members of the foreign media he received during this year's national day celebration. （photo by Vincent Chang）

The ROC has achieved a number of major advances in diplomacy recently. Shown here is the president of Guatemala accompanied by Premier Lee on a tour of Nine Tribes Cultural Village during his recent visit to Taiwan.