IT BELONGS to China, but Chinese officials want to spend billions of dollars transforming an island in the Taiwan Strait the size of Malta into a money-spinning model of cross-strait co-operation with a jointly run government. China and Taiwan have not co-operated over territory since the two sides split in 1949 after the Chinese civil war. The island of Pingtan stirs troubled memories in Taiwan. On one end of the island, on a hilltop overlooking a sandy bay, stands a concrete tower, which marks the spot where, in 1996, more than 100 Chinese generals gathered to watch a huge military exercise aimed at intimidating voters and candidates in Taiwan before the island's first direct presidential elections that year. Pingtan officials now try to play down the past. They focus instead on the island's 100km (60 miles) of sandy, mostly undeveloped, shoreline, hoping it has the same pulling power as the beaches of Hainan, a (much larger) tropical island off the southern coast that has become the playground of China's rich. There are plans to build five-star hotels, golf courses and yacht clubs. In 2010 the opening of a 4km bridge from the Chinese mainland to the island brought its picturesque villages within easier reach of the usual ruination by land-hungry developers. Another central-government document issued in November said that Pingtan should be turned into a “common home” with “common management” aimed at pursuing cross-strait co-operation at a higher level. In February a senior Chinese official said the posts of deputy director of the Pingtan management committee, as well as four deputy heads of departments under the committee, could be held by Taiwanese (for vastly higher salaries than Chinese civil servants would normally be paid). There would be no question, in other words, of letting Taiwanese be in charge of the place, but they would hold higher positions than any they have previously held in China.

Pingtan officials have offered other inducements too. The island would be a duty-free enclave, with business taxes lower than most of China. Residents could open bank accounts in Taiwan dollars and drive Taiwan-registered cars (a ferry service to the Taiwanese city of Taichung started up in November). In an exhibition hall devoted to Pingtan's plans, a map showing how the island might look in 2030 shows a road across the strait linking it to Taiwan. Officials do not say whether this would involve a tunnel or a bridge, but at around 100km in length, either would be the longest of its type in the world.

If it is ever built. The administration of Taiwan's president, Ma Ying-jeou, who begins a second term on May 20th (see article), has responded coolly to the whole Pingtan venture. A senior Taiwanese official says his government was never properly consulted about the scheme, and scoffs at the possibility of it ever being realised. Officials have also reminded Taiwanese citizens that they are forbidden (by Taiwan) to work for the Chinese government. They have described the Pingtan project as a Chinese experiment with its long-proposed (and long-rebuffed) “one country, two systems” formula for reunification, which they fear would be used to reduce Taiwan to the status of another Hong Kong. Even the most China-friendly of Taiwanese abhor this notion.

Undeterred, the governor of Fujian province, Su Shulin, said in March during a tour of Taiwan that by 2015 some 250 billion yuan ($40 billion) would be spent on developing Pingtan island. “We would like to open the package and let everyone look inside to see whether the gift comes from genuine goodwill or has strings attached,” he said.