The recent remarks by Taiwan (ROC) President Lee Teng-hui and the government’s confirming comments that cross-strait relations are "state-to-state" in nature has sparked a wave of discussions and much controversy. This is evident both in the domestic and international media, and among policy-makers in Taiwan, China, and in third powers, especially the United States. However, we feel that the propaganda war that is now well under way has not produced a clearly articulated explanation and interpretation of both the timing and the meaning of this announcement. To help to redress this imbalance, we would like to try to set out what we feel are the main points that ought to be taken into account.