President Chen Shiu-bian told television viewers on Sunday he intended to go ahead with the 20 March 2004 vote.
The first referendum calls on China to remove its ballistic missile threat and renounce any use of force to resolve the sovereignty dispute.
But the pro-independence Democratic Progressive Party (DPP) leader is also likely to push for a second ballot on a new constitution in 2006 – a move analysts say is equal to declaring independence.
The moves may prove dangerous. China has 496 missiles targeting Taiwan, and Chen’s plans earned a rebuke from Washington last week.
China has considered Taiwan part of its territory awaiting reunification ever since the two sides first split in 1949.
Beijing has threatened to invade the island should it declare independence and views the referendum as a step in the wrong direction.
“Playing victim of a foreign power or bravely challenging one always works to unite supporters during campaigns," said social psychology professor Huang Kuang-kuo of National Taiwan University.
“My guess is he will push through the referendum anyway no matter what. This is a risky campaign strategy"
“The fiercer the foreign threat is, the stronger people will rally behind him. This is typical manipulation of the public and nationalism."
Pushing for independence
A senior researcher at Academic Sinica, Taiwan's top academic institute, Hu Fo also believes Chen is pursuing the island’s independence sooner rather than later.
“My guess is he will push through the referendum anyway no matter what. This is a risky campaign strategy," Hu said.
Hu added that Chen might have underestimated Washington's opposition to his referendum drive.
But styling himself as a true "son of Taiwan", who rose from poverty to earn an unexpected victory in 2000 presidential elections, the 53-year-old former lawyer is unlikely to back down.
In August 2002, he irritated Beijing by saying "each side of the Taiwan Strait is a country."
Despite trailing in opinion polls to rival Lien Chan of the Kuomintang (KMT), Chen continues to enjoy widespread support, mostly among working class voters who identify with his struggle for power and humble origins.