'Only when Taiwan is no longer being isolated in the international arena can cross-strait relations move forward with confidence,' he said.

After decades of thwarting Taiwan's efforts to expand its international space, China is now willing to consider ways to help the island do that.

China's President Hu Jintao, in his capacity as head of the Chinese Communist Party (CCP), met Mr Wu Po-hsiung when the chairman of Taiwan's ruling Kuomintang (KMT) visited Beijing in May.

Mr Hu expressed understanding of Taiwan's need for international space.

He promised that once official negotiations resumed, Taiwan's participation in international bodies such as the World Health Organisation (WHO) could be discussed.

Taipei knows that it will be Beijing that decides how much 'space' it has. Its participation in international organisations thus far has been limited to those for which statehood is not a requirement - such as the Asia-Pacific Economic Cooperation forum and the World Trade Organisation (WTO). For years, Taiwan has sought, but failed, to join the WHO and United Nations (UN).

Mr Hu had mentioned the island's membership in the WHO, but Beijing would need to tread carefully, lest its support be misinterpreted as a weakening of its long-held 'one China' principle.

Chinese scholars trying to find a solution to this problem have turned to history for guidance. Two schools of thought have emerged.

The first looks to the former Soviet Union. A tightly knit federation of republics, it had a total of three seats in the UN: one for the Soviet Union itself, the other two for Ukraine and White Russia, members of the Soviet federation. This was the result of specific historical conditions at the time of the UN's founding: British dominions like Canada and Australia had seats, so Josef Stalin insisted on the same treatment for his Soviet empire.

The second school looks at China's own experience. When the UN was founded in 1945, the Chinese UN delegation consisted only of KMT men except for a sole CCP member. The communists had already gained control of a substantial part of China but the People's Republic of China (PRC) had not been established. In other words, the early Chinese seat in the UN was shared between the KMT and the CCP.

Could not China's UN seat be shared again, under the overall banner of China?

To substantiate their arguments, some scholars note that when the liberal-minded CCP leader Hu Yaobang was in power in the early 1980s, he had gone as far as to say that the country's name - the PRC - could be changed, if necessary, to accommodate Taiwan, whose official name is Republic of China (ROC). He had envisioned the two sides loosely unified under the common factor in their respective names: China.

The crux of the problem is whether Beijing is willing to recognise Taipei as a political entity. For the past 60 years, it had refused to do so, its argument being that the ROC had ceased to exist after 1949.

Any settlement has to start with the fact that the ROC exists and that the PRC's jurisdiction does not extend to Taiwan. This reality has to be accepted. The rise of a new generation of Chinese leaders, less bogged down by historical baggage, opens a possibility it might.

How would a political settlement look ultimately? Some scholars suggest that a 'Greater China Union', somewhere between a confederation and a federation, might be feasible. Both sides would recognise a common identity, the same Chineseness, but Beijing would allow Taipei to not only maintain its political system and way of life but also have considerable international space.

There is now a climate of conciliation across the Taiwan Strait, which bodes well for a viable political solution for Taiwan. Other ingredients for a solution include: a forward-looking leadership on both sides, further political liberation in China, continued economic integration across the Strait, a greater sense of a common Chinese identity, and encouragement from the international community, especially the United States.

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