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Taiwan's first referendum

• China: Taiwan threatens stability
• Factsheet:  China
Chen Shui-Bian

TAIPEI, Taiwan (Reuters) -- Taiwan will hold its first-ever referendum to coincide with Saturday's presidential election in a move that has infuriated arch-foe China and alarmed the United States.

Beijing, which says Taiwan is a renegade province that must be recovered, by force if necessary, views the ballot as a dry run for a vote on independence that could lead to war.

Parliament passed a referendum law last November that allows the president to call a "defensive referendum" when he deems Taiwan's sovereignty is under external threat.

Chen says China's deployment of 496 missiles aimed at Taiwan constitutes a national security threat.

Opposition presidential contender Lien Chan, who is running neck-and-neck with Chen, declared the referendum illegal and meaningless. His party is airing advertisements urging supporters not to vote in the referendum.

The referendum will ask voters two questions.

1. The People of Taiwan demand that the Taiwan Strait issue be resolved through peaceful means. Should mainland China refuse to withdraw the missiles it has targeted at Taiwan and to openly renounce the use of force against us, would you agree that the government should acquire more advanced anti-missile weapons to strengthen Taiwan's self-defence capabilities?

2. Would you agree that our government should engage in negotiation with mainland China on the establishment of a "peace and stability" framework for cross-Strait interactions in order to build consensus and for the welfare of the peoples on both sides?

The referendum will be rendered void if fewer than 50 percent of voters collect a referendum ballot paper. Picking up a paper ballot constitutes as taking part in the referendum.

The referendum is approved if more than 50 percent of those who take part cast yes votes.

A total of 16,497,746 voters are eligible to vote in the referendum. Results are expected by 10 p.m. (1400 GMT).

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