Analysis

Winnipeg Free Press - PRINT EDITION

Taiwan's yen for China

By: Harry Sterling

Posted: 07/4/2012 1:00 AM | Comments: 0

The nature of Taiwan's attitude towards relations with China, its former adversary, remains the primary preoccupation of that country's government and population.

This is the key reality which emerged from a visit to that dynamic island nation of 28 million during the recent re-inauguration of President Ma Ying-jeou.

Any ambivalence the Taiwanese may have concerning their relationship with the world's second-largest economy and emerging political and military superpower is fully understandable considering the decades of tension between them since Chiang Kai-shek's nationalist government was forced to flee to Taiwan following its 1949 defeat by Mao Zedong's Communist forces on the mainland.

It was only in 1993 that the two sides hesitantly started to begin a process of direct contacts. That process, however, was hampered in 2000 when the pro-independence-inclined Democratic Progressive Party led by then-president Chen Shui-bian came to power -- Chen is now serving a 17-year sentence in prison for fraud.

Ironically, the initial attempt to lessen tension by opening up direct links on a limited scale escalated dramatically when President Ma's anti-Communist Nationalist Party (Chiang Kai-shek's Kuomintang Party) took office in 2008.

In a further irony, President Ma, the one-time mayor of Taipei, Taiwan's capital, was himself born on the mainland, as were many of his party's top members.

In an effort to appeal to Taiwanese voters, however, Ma adopted a policy of no reunification, no independence and no conflict -- in effect a status quo policy that avoids a showdown between those who favour formal outright independence and the small minority which still might favour reunification with China.

With regard to the latter group, a senior Taiwanese official pointed out that whereas 20 short years ago only about 15 per cent of Taiwan's population would describe themselves as "Taiwanese," now only 15 per cent would classify themselves as "Chinese" in a nationalist sense.

Notwithstanding those who would still like to see Taiwan someday declaring its formal independence, Ma's non-confrontational approach to China has been quite positive by almost anyone's standards.

Taiwan now has investments of more than $100 billion in China. Ten of China's Top 20 companies purportedly are actually Taiwanese controlled. Eight million Chinese work for Taiwanese firms. One million Taiwanese businessmen, some with families, live in China.

Although until recent years direct air service to China was non-existent, now 40 Chinese cities have direct air links with Taiwan and 10,000 Taiwanese travel to China on a daily basis. In 2011, more than five million Taiwanese visited China and 1.7 million Chinese tourists visited Taiwan.

Chinese companies are keen to invest in Taiwan, only restricted from investing in commercial real estate. Some 50 per cent of Taiwan's coal imports come from China.

Interestingly, a Taiwanese trade official said in order to strengthen Taiwan's domestic economy, the government was trying to convince Taiwanese firms operating in China to consider investing more in Taiwan, thus reinforcing its economic potential and employment levels. Another said the government did not want the closeness of bilateral relations "to melt too fast like ice," suggesting this would undermine Taiwan's national interests in the process.

Given the advantages both countries derive from their vastly improved relationship, what explains the ambivalence of some Taiwanese towards the changed relationship between the two former adversaries, especially since recent polls indicate 70 per cent of Taiwanese support the current status quo policy of Ma.

Some express concern that if social unrest in China escalated over such things as controversial land seizures and systemic corruption among the Chinese elite, China's new leaders, once in power, might try to deflect growing domestic tension by reverting to a more bellicose position towards Taiwan's current de facto autonomy. The U.S. commitment to defend Taiwan, however, would presumably act as a deterrent to forestall China actually contemplating military action against Taiwan.

They might also, it's thought, once again block Taiwan's attempts to become an observer or member of international bodies, as was the situation in the case of Taiwan's wish for observer status in the World Health Organization, something which many Canadian parliamentarians supported. Others are concerned a new leadership might use its trade and investment power to lure some of the remaining 23 states still maintaining diplomatic relations with Taiwan to shift relations to China.

Although such a doomsday scenario might seem unlikely due to the advantages both countries enjoy from their mutual co-operation, at some point, the Taiwanese might have to confront the critical question as to just how long the status quo can survive within an evolving relationship between a superpower of more than 1.3 billion people and a tiny nation of 28 million. It's a question friends of Taiwan, including Canadians, might also keep in mind in coming days.

Harry Sterling, a former diplomat, is an Ottawa-based commentator. He writes frequently on Taiwanese-China relations and recently spent a week in Taiwan receiving briefings on Taiwan's relationship with Beijing.

Republished from the Winnipeg Free Press print edition July 4, 2012 A11

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