Brain Fertilizer

If we can get through the next 12 months without major incident, that is.

China will continue to speak softly in managing its tricky relations with Taiwan, after brandishing the big stick seemed to backfire on Beijing, analysts said. China's communist government may offer to let the 2008 Beijing Olympic torch pass through Taiwan, and dangle economic goodies, in an attempt to undermine any moves towards independence on the prosperous island.

Previous hardline tactics, including missile launches and threats of force, only boosted anti-China politicians and sentiment in Taipei, experts say.

China angered Taiwanese two years ago by passing a law pledging potential use of force if Taiwan declared independence.

"Behind the scenes, there has been this kind of adjustment," said Niu Jun, an international studies professor at Peking University in Beijing.

Elections in Taiwan this year and next will be key tests of whether the carrot is working better than the stick did.

If voters uphold the opposition Nationalist (KMT) Party camp's parliamentary majority in elections later this year and give it the presidency next spring, cross-strait relations could improve, as the KMT has said it would reach out to Beijing.

The KMT, backed in part by Taiwan businesses active in China, takes a conciliatory but guarded view of the Communist government, while current President Chen Shui-bian's party distrusts Beijing and advocates moves toward independence.

Experts believe Beijing would prefer to deal with the KMT, its former rival.

In pursuit of reunification with the island that split from China in 1949 after a civil war, Beijing will keep to its soft line toward democratic, self-ruled Taiwan as long as the Chinese economy stays strong and Taiwan avoids all-out independence, experts say.