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For 60 years, the National Palace Museum has stood in the forested hills north of Taipei as a symbol of the Chinese civil war that never ended. Its collection – more than half a million artifacts that were once housed in the Forbidden City – is considered by the Communist government in Beijing to have been stolen by the fleeing Kuomintang, making the museum's very existence an affront.

As the two heavily armed Chinas glowered at each other across the Taiwan Strait, the rivalry between the National Palace Museum in Taipei and Palace Museum in Beijing remained so bitter that the two institutions wouldn't even refer to each other by name. Just as many insist that there can only be one, unified China, Beijing claims there can only be one Palace Museum, even if it exhibits only the artworks that were abandoned as less valuable when the Nationalists withdrew to Taiwan (which refers to itself officially as the Republic of China) in 1949.

But this year, the walls built in anger have quietly started to fall away. The director of the National Palace Museum, Chou Kung-shin, travelled to Beijing in February to hold her first official talks with Zheng Xinmiao, the director of the Beijing museum. She had a bold request to make – that Beijing loan her museum 37 artifacts from the Qing dynasty period so that the Taipei museum could for the first time exhibit all the belongings of the Yongzheng emperor, a despot who died nearly 300 years ago.

To Ms. Chou's delight, Mr. Zheng agreed, and two weeks ago a portrait of Yongzheng, dressed in gold and with a string of pearls draped around his neck, was put on display in the front room of the National Palace Museum, marking the first time the two museums have co-operated on an exhibit. In another breakthrough, many among the eager crowds who flocked to see the showing have been tourists from the Chinese mainland.

After six decades of stalemate, the sudden willingness of the Beijing museum to loan its treasures to Taipei reflects how far and how fast relations between the two sides of the Taiwan Strait have warmed in the 16 months since Taiwanese President Ma Ying-jeou assumed office and declared his intent to seek better ties with the mainland.

The changes have been as simple in nature as they are astonishing for those who live here. Last December saw the first direct flights between Taipei and the Chinese mainland, ending years of tiresome shuttling via Hong Kong. February saw the establishment of the first direct postal services and shipping links across the strait. In April, Taiwan began allowing Chinese investment in some sectors of its economy and opened its doors to Chinese tour groups. In exchange, China dropped its long-standing opposition to Taiwan joining any international forums, allowing the island to take up observer status at the World Health Assembly under the neutral name of “Chinese Taipei.”

Ironically, it was the return to power of the Kuomintang, the same movement that fought the Communists 60 years ago, that paved the way for warmer ties after eight years of antagonist relations while Taiwan was ruled by the pro-independence Democratic Progressive Party. Under Mr. Ma, the party decided to partly bury the hatchet with its long-time enemy in order to try and escape the crippling isolation Beijing has imposed on the island.

“The ruling party, under President Ma, has a different understanding of how the world is. It's very different than a decade ago. … The world has changed and China has become much larger,” Chao Chien-min, Taiwan's deputy minister of Mainland Affairs, the department that handles relations with Beijing, said in an interview.

“Just in the East Asian area, dozens of free-trade agreements – collective and bilateral – have been concluded in the past few years and we have not been able to be included in any of them [because of opposition from China]. We cannot allow that trend to continue. We have to do something, and relations with mainland China are a very important part of the equation.”

While the new links have been broadly welcomed in Taiwan as practical and overdue, the government's next proposed step, signing a tariff-reducing trade agreement with China, is already generating opposition as a step too far. Though details of the proposed agreement have not been made public, many are concerned that any deal will effectively make Taiwan an economic appendage of China, as no guarantees have been made that Beijing will follow up by allowing Taiwan to join regional and international trade groupings.

Many in Taiwan's pro-independence movement – which is currently hobbled by the scandal surrounding former president Chen Shui-bian's conviction on corruption charges – worry that Mr. Ma, in his haste to win international plaudits for reducing tensions with the mainland, will in the process give Beijing the levers to bring the island back under its effective control. Some believe Mr. Ma, who was mayor of Taipei before winning election as President last year, is being badly outplayed by the more veteran Chinese President Hu Jintao, who marked the 60th anniversary of Communist China earlier this month with a speech calling for Taiwan's “peaceful reunification” with the mainland.

“The direction [of improving ties] is okay. But regarding how to manage it, I have not only reservations, I have serious doubts about Ma's ability to manage relations,” said Antonio Chiang, a newspaper columnist who was deputy head of the National Security Council during Mr. Chen's presidency. The improving ties with Beijing, he said, “are not an achievement for Ma. They are an achievement for Hu Jintao. … Now Hu can claim reconciliation with Taiwan as his biggest legacy.”

Mr. Ma's administration acknowledges it remains suspicious of Beijing's intentions even as it pushes for better relations. Mr. Chao suggested Beijing should allow Taiwan to join more international organizations, such as the United Nations Framework on Climate Change and the International Civil Aviation Organization as a confidence-building measure. And this week, Mr. Ma himself said it was difficult to move forward on improving ties while China maintains more than 1,000 missiles pointed at the island.

Polling conducted by Mr. Chao's Department of Mainland Affairs found that while some 63 per cent of Taiwanese supported warmer ties with the mainland, there was little support for unification, either now or in the near future. The wide majority preferred the ambiguous status quo for now, and outright independence remains a more popular idea than reunion with Beijing.

Sixty years after Taiwan's de facto split from the rest of China, even many of those who have immediate family on the other side say that while they welcome closer ties, the cultural gulf between the two peoples has grown too large to be completely patched over.

“I consider [Taiwan] my home now. I feel a distance when I go back to what was my once my hometown,” said Chang Yu-fa, a retired historian who was a 13-year-old boy in 1949 when he was separated from his family and taken with a group of schoolmates to Taiwan by the Kuomintang. He didn't see his family again until 1989, when he returned to his native Shandong province after being invited to Beijing on an academic exchange.

Now a father of two and grandfather of three, Prof. Chang said that while mainland China has changed dramatically in recent years, it lacks the democracy and freedom of speech that Taiwanese have taken for granted for decades. As a result, he said, Taiwanese think differently and have different values than even their direct kin on the other side of the Taiwan Strait.

“I think most of the people in Taiwan hope that China will accept the existence of Taiwan and treat us equally. … It would be hard to get the second generation of people whose parents came to Taiwan to think of China as their country, not to mention younger generations.”

The negotiations over the loan of the portrait of the Yongzheng emperor illustrate not only the success so far of the Ma-Hu rapprochement, but also how delicate the way ahead remains. Ms. Chou of the National Palace Museum said it was necessary to shelve some messy details in order to make the joint exhibition happen. Arguments were put off, rather than resolved.

“We're the National Palace Museum and theirs is the Palace Museum, so we avoided using names. And we didn't talk about [competing claims over final ownership of the artifacts] either. By avoiding those two things, we were able to achieve co-operation,” she said with a chuckle.

But Ms. Chou said the Taiwanese museum couldn't consider returning the favour and lending artworks to Beijing so they could be displayed in their old home in the Forbidden City. There's just no guarantee, she said, that anything sent to Beijing would ever be returned.