How Chinese is it? A newly refurbished—and now nominally "Asian"—National Palace Museum recently mounted a landmark Song Dynasty show

For more than half a century, since Chiang Kaishek carried off nearly 3,000 crates of choice treasures from Beijing's imperial art holdings, Taiwan has served as custodian of the world's finest collection of Chinese art and antiquities. But in January, Taiwan's government decided to downplay that link--or as many see it, that debt--to China by altering the charter of the National Palace Museum, where those works are stored. References to the collection's true origin in the Imperial Palace [a.k.a. Forbidden City] in Beijing were removed and the museum's very identity was reconfigured as "Asian" instead of "Chinese."

The move is part of Taiwan's ongoing effort to wipe "China" off the names of national agencies, utilities and corporations, and to bolster a distinct Taiwanese identity. As this nation-building project has advanced in recent years, the issue of what to do with the National Palace has become an increasingly awkward one. How can Taiwan say it's different from China while holding on to many of the PRC's most valuable cultural heirlooms?

The question is extremely difficult for Taiwan's government. Sticky concerns over ownership have hampered visual-arts exchanges between Taiwan and China for years, even as those in music and theater have flourished. Lately, however, a number of breakthroughs have taken place at Taiwan's major museums, including the National Palace Museum and Taiwan's main showcase for modern art, the Taipei Fine Arts Museum. After years of estrangement, the top museums in China and Taiwan are talking to each other and, in certain circumstances, even lending each other works.

One of the major milestones came at the National Palace, which for the first time ever exhibited borrowed works from China alongside items from its own collection. The pairing happened in "Grand View," one of the most comprehensive exhibitions ever of Song Dynasty art and a show that celebrated both the museum's 80th anniversary and its Feb. 8 grand reopening following a three-year, $21-million renovation. For the festivities, the museum invited one of the most important contingents it has ever received from China, including two curators from its mainland counterpart, the Imperial Palace Museum in Beijing.

The Beijing curators were reluctant to get caught in a political morass by discussing their visit, but when I reached one of them by phone, his point was probably the most salient one, if also the safest. "We think conducting exchanges with the Taipei National Palace is very important," said Yu Hui. "Once they organized this forum, we immediately said we would attend."

On both sides, there is now a real eagerness to connect. These feelings culminated in another breakthrough late last year between the Taipei Fine Arts Museum and the National Art Museum of China. Each institution dipped into its permanent collection to lend more than 100 paintings to the other, producing "The Blossoming of Realism: The Oil Painting of Mainland China Since 1978," which was mounted in Taipei, and "1950-2000: The Odyssey of Art in Taiwan," which appeared in Beijing. The shows opened last October and reflected divergent histories following the civil war that split the two sides in the 1940s.

"We're familiar, and yet we're strangers," said Taipei Fine Arts Museum director Huang Tsailang. "They want to improve their understanding of Taiwan, and Taiwan also hopes to see a clearer progression of what was happening in China." Even more than that, he continued, through these two shows each side allowed the other to present "an exhibition and explanations that they put forward by themselves." If there was a catch, he said, it's that the exchange "may have been much easier ... because this was modern art. With the Palace collection, you have a conflict over the rights to ownership."

China's Palace Museum was founded in Beijing in 1925 by the government of Sun Yat-sen as a way of opening centuries of imperial collecting to the public. Chiang Kai-shek first moved the collection to various locations in the 1930s to keep it from the invading Japanese. When he lost China to Mao's Communists in the late 1940s, he carried the finest selections from the trove to Taiwan, and in 1961 paraded an exhibition across the U.S.--stopping at New York's Metropolitan Museum, Washington D.C.'s National Gallery and museums in Boston, Chicago and San Francisco--as evidence that his was the authentic Chinese government.

The collection's current home, modeled on the imperial architecture of Northern China, is an edifice built north of Taipei in the mid-1960s. At present, for fear that China will try through lawsuits or political pressure to seize works that travel outside of Taiwan, the National Palace Museum will only lend to four countries--the U.S., Germany, Austria and France--all of which have passed laws guaranteeing museum loans will be returned to Taiwan.