AUTHENTICITY COUNTS: Wang Yung-sheng introduces his products to consumers and teaches them how to tell the difference between real and fake ones (ZHOU XIAOYAN)

Wang Yung-sheng is the boss of Yidianyi Art Collection Co., a slowly growing jewelry and handicraft chain based in Taiwan. With four stores on the island off southeast China's coast and six on the mainland, Wang spoke promisingly of yet another store on Dadeng Island in Xiamen, Fujian Province.

Dadeng Island, home to the newly built Dadeng Town market, has offered duty-free Taiwanese products since 1999. Built as an extension of the Dadeng Cross-Straits Petty Commodity Trading Market, the Dadeng Town market is the only one of its kind on the Chinese mainland to trade petty commodities with Taiwan.

"This is our first store in Fujian and we plan to use this as a foothold for further expanding businesses outside the major cities like Beijing and Shanghai," Wang told Beijing Review.

Wang isn't alone. Covering an area of 70,000 square meters, the Dadeng Town market is home to 206 stores, among which 40 percent are Taiwanese that look to expand their businesses on the mainland.

Burying the hatchet

Located in the southeast waters off Xiamen's Xiang'an District, Dadeng and two other islands (Xiaodeng and Jiaoyu) are the closest mainland territory to Taiwan's Kinmen.

The proximity, while currently providing a convenient venue for trade and exchange, has been flash points between the mainland and the tiny island during the early part of the 20th century. Kinmen was the ruling Kuomintang regime's forefront of military antagonism against the Chinese mainland following the founding of the People's Republic of China in 1949. Tensions in the 1950s resulted in bombardments of each respective island.

As cross-Straits tensions eased in the 1980s and 1990s, fishing boats from Taiwan frequented Dadeng, trading commodities with mainland residents. Although technically classified as smuggling, they reflect both sides' urgent needs to trade with their compatriots across the Straits.

In 1998, the Dadeng Cross-Straits Petty Commodity Trading Market was established, aiming to regulate petty commodity trade, enhance cross-Straits exchanges, push forward economic development and, more importantly, facilitate businesses between the two sides.

The market legalized trading activities between both sides and made it possible for local residents from both the mainland and Taiwan to start up small businesses. Legal trading in Taiwanese commodities consisted of six categories: food and oil, native and livestock products, textiles and clothes, handicrafts, light industrial products, and medicines.

But the initial development of the market was anything but smooth. Cross-Straits relations were strained in the late 1990s when then Taiwan leader Lee Teng-hui defined cross-Straits relations as "state-to-state, or at least special state-to-state relations." The Chinese mainland objected to his characterization. As a repercussion, Taiwanese boats were forbidden from landing on Dadeng's shore. Trade between the two sides was limited to boat-to-boat exchanges on the open water, and the Dadeng market seemed certain to be swallowed by the sea with only 70 to 80 of its 504 booths occupied and open for business.

Normalization of cross-Straits relations in recent years has allowed the market to resume normal business operations, with major improvements being achieved after the realization of the "three links"—direct postal, transportation (especially airline), and trade—in 2008 between the Chinese mainland and Taiwan.