Taiwan's 2008 presidential elections may still be a little more than 11 months away, but the campaign is well underway, with both candidates pledging to improve relations with the island's biggest security threat and largest trading partner: China. VOA's William Ide has this report from Taipei.

As in many places around the world, economic ties with China are playing an ever-increasing role in politics in Taiwan.

The mainland is potentially a military threat to the island of Taiwan, but it is also an increasingly significant economic partner. As of last June, Taiwan had invested more than $50 billion in businesses on the mainland, and it is estimated that a million Taiwanese live and work there.

Beijing's history with Taipei is complex.

After the defeat of the Japanese in World War Two, Mao Zedong's Communist army fought Chiang Kai-shek's Nationalist troops for control of China. Mao won in 1949, and Chiang and his Nationalist government fled to Taiwan.

China claims the self-ruled island is part of its own territory, and threatens to take it back by force if it seeks formal independence. To back up that threat, it has deployed hundreds of missiles along its southeastern shore facing Taiwan.

Ma Ying-jeou, a former Nationalist Party chairman and mayor of Taipei City, is the opposition's candidate in the elections. He believes that to improve ties with China, Taiwan needs to find a way to put its disputes over sovereignty aside, and focus instead on peace negotiations with the mainland.

"The Taiwan Strait should not be a flash point in East Asia, it should be a builder-up for peace and prosperity," he said.

Speaking with foreign correspondents in Taipei this week, Ma outlined a sweeping range of changes he plans to implement if elected, including moves to lift restrictions on trade with China, allowing companies from Taiwan to invest more on the mainland. He also supports measures to allow more mainlanders to visit as tourists, as a way of boosting the island's economy.

Ma believes that Beijing wants peace and not conflict with Taiwan. He argues that as China prospers, it is becoming more sophisticated in the way it handles its relations with Taiwan and the rest of the world.

"Obviously they [China] have a big stake to lose if war really breaks out between Taiwan and the mainland," he said. "Each side will probably suffer a setback of economic development for decades."

Ma may have a better chance of reopening negotiations with Beijing, because his party supports eventual reunification with China.

His opponent, Frank Hsieh, is a member of the independence-leaning Democratic Progressive Party of President Chen Shui-bian. Since Mr. Chen stepped into office, China has refused to talk to his administration. Hsieh admits this is an obstacle, but believes it can be overcome.

Speaking with foreign reporters through an interpreter, Hsieh said that when Mr. Chen was elected in 2000, and even when he was re-elected in 2004, China refused to talk with the DPP administration.

"I think that for China to accept the reality that the people have chosen a DPP president, I need to win by a larger margin this time for China to come to terms with the reality that this is actually the choice of the people," he said. "Of course though, we are assuming that China's behavior is rational, that in good reason, that they should accept the reality and engage in a dialogue with the DPP leadership."

Hsieh says he, too, will pursue policies to expand trade links with China, but also stressed the need for Beijing to give Taiwan the respect it deserves - and more room in the international arena.

Hsieh says that more than policy, attitude is the key: how Taiwan treats China, and how China treats Taiwan. He cast doubt on Ma's expectation that China is willing to co-exist with Taiwan: Beijing says there will eventually be re-unification, whether peacefully or by force of arms.