I think Taiwan's economy needs an overall structural readjustment. Our new model focuses on innovation and research. This is different from our growth model in the past, which was centered on the manufacturing industry.

We have always had diverse channels of communication across the strait. These include not just official communications but also people-to-people contacts... There are differences between the positions of the two sides of the strait. In Taiwan, we have done our best to minimize that gap. I believe that the Chinese realize the goodwill we have put forth at the inauguration.

If China do take economic measures to apply pressure to Taiwan, they will have to think about the price that they are going to pay. Because the surrounding countries will be looking very carefully at what measures China will take against Taiwan.

I think that the society and our democracy are mature enough to place emphasis on the quality and the value of the individual politician, rather than their gender. Some people will find it fashionable to have a woman leader, but I think the reason people chose me as the leader of this country is because my policies and my values suit the needs of Taiwan today. We represent people who want to have change in the society.

I am not clear what the U.S. means when they use the term "entity." For us here in Taiwan, we believe that we are a country, a democratic country.

China is still our largest trading partner; however, complementarity between our economies is decreasing. We had the ability to organize a manufacturing process, and then we moved our manufacturing capability to China to make use of their labor pool.

Different generations and people of different ethnic origins have different views on China. But they all agree on one thing. That is democracy.