SHANGHAI, May 2 (Xinhuanet, by Tian Sulei ) -- Visiting KMT Chairman Lien Chan from Taiwan said here Monday Taiwan faces a "crucial moment," when it must decide what direction it will take in cross-Strait relations.

"Almost all the world's major countries have placed great importance on the mainland, viewing it as an important place to improve competitiveness and expand markets," Lien said at a luncheon with representatives of Taiwan businessmen on the Chinese mainland.

TAIWAN SHOULD SEIZE THE CHANCE

"In such a situation, Taiwan would suffer a serious negative impact if it keeps a closed mind," said Lien, who is leading a 60-member delegation of the KMT, Taiwan's major opposition party, on a "journey of peace" to the mainland.

Lien said now is a crucial time to "seize the market and business opportunities and a way out" on the mainland.

The KMT was China's ruling party before 1949, when it lost the civil war to the Communist Party of China (CPC) and retreated to the island of Taiwan. It ruled Taiwan for around 50 years before becoming an opposition party.

The mainland has vigorously pushed for peaceful reunification with Taiwan, while the Taiwan authorities are trying to sever links with the mainland in attempts to seek "Taiwan independence. Tensions across the Straits have been high.

The KMT and its "Pan-Blue" coalition, which as a whole holds a majority in Taiwan's "legislature," adhere to the "one-China" principle and seek closer integration with the mainland.

The delegation, invited by the CPC Central Committee and its General Secretary Hu Jintao, arrived in Shanghai Sunday for the last leg of its eight-day mainland visit that begun on April 26.

Lien said he admires the rapid economic growth achieved by the mainland, calling the GDP growth of nearly 10 percent each year "stunning." He urged Taiwan businesses to "grasp the opportunity."

The room for cooperation between the two sides is "very great,"Lien said. He mentioned marketing, brand management, business administration, development and manufacturing as possible sectors of further cooperation.

Taiwan businessmen have invested in more than 60,000 projects in the mainland, with contractual investment hitting almost 80 billion US dollars and 40 billion dollars being actually used.

Indirect trade volume between the mainland and Taiwan totaled more than 400 billion dollars, and Taiwan has obtained an accumulated trade surplus of 270 billions dollars. In 2004 alone, the trade volume across the Straits reached more than 78 billion dollars.

Lien called on the Taiwan authorities to "act in line with the trend of the times and the common aspiration of the people" in handling cross-Strait affairs.

ESTABLISHING ECONOMIC COOPERATION MECHANISM

In his luncheon speech, Lien also called for establishing an economic cooperation mechanism, a "common market" mechanism, across the Straits.

Lien said the KMT and the CPC have agreed to open two forums topromote cross-Strait exchanges, one on peaceful development and the other on economic, trade and cultural affairs.

He said an economic and trade forum has been established, with KMT Secretary-General Lin Feng-cheng and director of CPC Central Committee's Taiwan Work Office Chen Yunlin to represent the two sides in the forum.

"Establishment of such a platform is of vital importance," saidLien. "As currently there's still no sign of official contacts between the two sides."

He said it's best for authorities to push for the cross-Strait economic cooperation mechanism, but in the absence of efforts fromthe authorities, the KMT hopes to play a role through promoting the establishment of the two forums.

"We cannot just let time pass," said Lien.

Speaking at a press conference earlier Monday morning, Lien said promoting all-round economic and trade exchanges is the biggest goal of the visit, saying it is "the most practical issue that could be approached at this stage."

AUTHORITIES' ROLE

Lien urged the Taiwan authorities to actively prepare for talkswith the mainland side on signing a peace accord, saying that ending the hostility would surely bring a more peaceful environment to Taiwan.

He said the KMT and the CPC have reached agreement on promotingthe signing of a peace accord between the two sides of the Straits.

He also urged the Taiwan authorities to push for the implementation of the 12-item consensus reached between KMT Vice-Chairman Chiang Pin-kung and director of the CPC Central Committee's Taiwan Work Office Chen Yunlin in an earlier KMT mainland visit,saying they are far more significant to Taiwan than to the mainland.

"General Secretary Hu Jintao told me the 12 items are all for the benefits of Taiwan people," Lien said at the press conference.

MEETS WANG DAOHAN

On Monday Morning, the KMT delegation met with Wang Daohan, president of the mainland-based Association for Relations Across the Taiwan Straits (ARATS) in Shanghai, to express its hope of resuming cross-Strait dialogue.

Wang said despite the political differences between the two sides, "We're all Chinese linked by the same blood and cultural background," said Wang. "Therefore we should work together to promote peace, development and cooperation in cross-Straits relations, strive for a win-win situation and contribute to the glorious future of the Chinese nation."

VISIT PRAISED

The visit has been widely praised by the China media as a big success. The visit culminated on April 29 with a meeting in Beijing between CPC leader Hu Jintao and KMT leader Lien Chan, thefirst meeting between top leaders of the two parties since the 1960s.

A press communique issued after the meeting says the CPC and KMT have agreed to work together to promote cross-Straits exchanges and cooperation in five aspects, including promoting theformal end of the state of hostility and pushing all-around economic cooperation and trade across the Straits.

The KTM delegation is due to leave Shanghai for Taiwan Tuesday.Earlier, it had visited Nanjing, Beijing and Xi'an.