I will not declare independence, I will not change the national title, I will not push forth the inclusion of the so-called "state-to-state" description in the Constitution, and I will not promote a referendum to change the status quo

Chen Shui-bian

He stopped short of bowing to Beijing's insistence that he accept the principle that there is only one China and Taiwan is a part of it.

Such a statement would have been widely seen on the island as putting Taiwan on an inexorable path to surrendering its sovereignty.

As most people in Taiwan had expected, Chen Shui-bian took an oblique approach to the One China principle, so much emphasised by Beijing.

He addressed it only by saying that he believed leaders on both sides possess enough wisdom and creativity to jointly deal with the question of a future One China.

China: Chen 'evasive'

That clearly falls well short of Chinese leaders' repeated demands.

China put pressure on Taiwan ahead of the inauguration

A statement published by China's official Xinhua news agency criticised him for refusing directly to accept the One China principle.

It described his approach as evasive and vague.

Yet Mr Chen balanced this side-stepping of the One China issue with a number of statements which are likely to carry some weight in reassuring Beijing.

He reiterated his pre-election pledges not to declare independence, change the name of the state or call a referendum on Taiwan's future unless Beijing moved to use force against the island.

No constitutional change

He said he would not enshrine in the constitution outgoing president Lee Teng-hui's insistence that Taiwan and China should relate to each other as separate states.

Significantly he also indicated that he intends to leave in place Taiwan's 1991 National Reunification Guidelines and an advisory board named the National Reunification Council.

These were established by the previous Nationalist KMT government with a view to setting out a theoretical blueprint for long-term reunification - even though China had in recent years become increasingly frustrated with the vagueness of the KMT's commitment to One China.

Mr Chen did not directly address Beijing's demand that he acknowledge publicly that he regards himself as Chinese, yet he did speak of the blood ties and common cultural and historical background of Taiwan and China.

Moderate Chinese riposte

Beijing's initial reaction seems relatively moderate in its tone, compared with some of the government's statements over recent weeks.

Initial responses from mainland Chinese academics, interviewed on Taiwanese television stations, have also been conciliatory.

One Beijing political scientist said that while his government would certainly not be satisfied, Chen Shui-bian's emphasis on reconciliation sounded a positive note.

Both sides could now "take a breath", he said. He added that China, despite its series of military threats against Taiwan, was now likely to wait somewhat longer to consider its approach to the island's new leader.

Still a flashpoint

Mr Chen's speech may have set the tone for his new approach to cross-straits relations.

But it actually revealed little new about how he means to tackle concrete issues in the relationship.

He may have defused some of the angry rhetoric which has prevailed over recent months and weeks.

But the basic dynamic of the problem remains unchanged. The Taiwan Strait continues to be a potential military flashpoint with powerful forces pulling in dangerously contradictory directions.

On one side there is Taiwan's maturing sense of its separate identity and on the other the growing nationalist pressure in China to resolve the legacy of the 1940's civil war, which sent Chiang Kai-Shek's defeated KMT into exile on the island.