Taiwanese President Tries to Restart Peace Talks

In his most conciliatory speech since taking office in 2000, the independence-minded leader said he was ready to resume negotiations after a five-year gap, on the basis of a previous agreement he had earlier rejected.

The National Day address, which also included praise for China's reforms, appeared aimed at striking up a new relationship with the mainland, which views Taiwan as a renegade province that must be reunited by force if necessary.

It comes less than a month after a major shift in Beijing's leadership, under which the former president Jiang Zemin - considered a hardliner on the issue of Taiwan - gave up control of the military to the current leader, Hu Jintao, who has stressed the need for a "peaceful rise" for China.

Commentators warned earlier this year that the threat of war was greater than at any time in a decade.

Mr Chen accused China of targeting Taiwan with 600 ballistic missiles, but called on both sides to step back from the brink. "The threat of military force represents the greatest shadow of terror and forces of darkness across the Taiwan Strait," he said. "Therefore, I propose that both sides should seriously consider the issue of arms control and take concrete actions to reduce tension and military threats."

He called for confidence-building measures, including a new code of conduct and the reassertion of the negotiating principles laid down in 1992 when Taiwan and China accepted the principle that they were "one country", but agreed to differ about their interpretation of what that implied.

Mr Chen had rejected this fudge, but said yesterday it was a "not necessarily perfect, but acceptable" basis for the resumption of dialogue.

But he also said that his government would push ahead with plans to buy £10bn of arms from the United States and reform the constitution, a move that China has warned could lead to war.

Beijing has yet to respond, but it is likely to remain suspicious about the intentions of Mr Chen, whose core supporters favour independence.