The Korea Herald


[Dimitri Bruyas] Resolving Taiwan’s policy toward China long overdue

By Korea Herald

Published : Dec. 10, 2018 - 16:53

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No one likes dealing with a difficult situation. But now is the time to get things done for Taiwan’s Democratic Progressive Party, which will hold a by-election on Jan. 6 to replace its chairperson, President Tsai Ing-wen, following the party’s crushing defeat in the Nov. 24 local government elections.

The date was decided on Wednesday at a meeting of the party’s Central Executive Committee, but the question of whether Taiwan should maintain its policy toward China before the next presidential election is long overdue.
This is not a minor issue in our highly polarized political system.

Supporters of the president argue that the results of the “nine-in-one” elections are an indication that the government should follow its course on cross-Taiwan Strait policies, while her opponents contend that she should stop postponing decisions and engage in a dialogue with China on the basis of the “1992 Consensus.”

The answer to these questions, however, lies in our perception of time.

Why? We all have a different perception of time, which often feels like it may drag at some time and speed up otherwise.

This difference between how time passes and how we experience it, however, is the most important indicator of the soaring gap between Taiwan’s people and the DPP leadership, who moved away from the “China collapse theory” and converted to the “China threat theory.”

The latter was a popular concept among the members of the ruling party over the last 10 years, until China eventually became the world’s second-largest economy and started exerting a growing international and regional influence.

The result has been an increasing importance of the “China card” to rally people behind the party since the DPP came into power in May 2016.

Overplaying ‘China Threat’ theory

Time and again, we have been told of Chinese government’s alleged attempts to meddle in Taiwan elections in a move to boost the president’s reform agenda and pave the way for her reelection.

In the run-up to the Kaohsiung election, however, the ruling party failed to convince voters that China’s alleged influence on social media platforms was part of a “disinformation campaign” responsible for the unexpected surge in the popularity of the candidate from the opposition Kuomintang, Han Kuo-yu.

Han, 61, clearly defeated his main rival, the DPP candidate, Chen Chi-mai, on a platform of economic development for the port city which he openly described as “outdated and poor.”

Declaring his victory in front of a massive crowd of supporters, Han pledged to spare no efforts to address the air pollution situation in Kaohsiung -- one of the residents’ main concerns. The mayor-elect also announced plans to set up a “cross-strait working group” to promote trade.

In the runup to the elections, however, the president called on Taiwan expatriates to return home, saying “the whole world is watching whether Taiwan’s people will vote for a China-leaning party or chose one that is committed to democracy and human rights.”

Kaohsiung people still made a well-considered decision and elected a new mayor who has never concealed his support for the 1992 Consensus.

Denying the negative economic outlook

The Academia Sinica, Taiwan’s biggest research center, on Dec. 5 cut its forecast for the nation’s gross domestic product growth this year to 2.64 percent and said it expects it to slow further to 2.45 percent next year, as trade tensions are likely to continue to influence financial markets.

Demand from China, Taiwan’s largest trade partner, has already taken a hit and firms have negative views on their business prospects next year.

At the same time, the ruling party has failed to explain that Taiwan also needs to face the possible fluctuations of the US economy, an eventual downturn in Chinese economic growth, and expected outflow of foreign funds to emerging markets such as Indonesia, India and Thailand.

Fubon Financial also estimates the economic growth next year at around 2.4 percent, and according to US financial services giant Moody’s, Taiwan should address its growing population aging problem too.

Even if the US and China have agreed to a 90-day suspension on new tariffs, Taiwan-based companies with manufacturing facilities in China are being pushed by their brand clients to repatriate production to lower the risk from the trade war. The move, however, could have a limited impact on Taiwan economy whose unemployment rate is already at around 3 per cent.

Another problem is that the US-China trade war might drag on for up to 10 more years, according to Terry Gou, the founder of Foxconn Technology Group, who warned on Dec. 4, of fundamental changes to export markets as the US could continue to build barriers to prevent China from acquiring key technologies and components.

Downplaying decrease in foreign visitors

To the government, Taiwan is not affected by the sluggish economy; even though bars, hotels, restaurants, attraction parks and landmarks of various cities have already seen large decreases in tourists in recent years.

Authorities are always keen to blame the sharp decrease in the number of Chinese tourists to the increasingly strained cross-strait relations; yet fell short of announcing concrete measures to deal with the likely continued drop in tourist arrivals this year.

The typical response to the rhetorical question -- Why don’t people come to Taiwan anymore? -- is always the same: We welcome Chinese tourists although they cannot come due of the politicization of cross-strait affairs. This is just a self-congratulatory assessment of an anticipated policy failure.
According to the Tourism Bureau, the 10 millionth arrival was recorded on Dec. 1.

Since it is the fourth year that Taiwan has reached the 10 million mark, authorities said that there will be no special celebration of that milestone, but rather a special event will be held when the number surpasses last year’s total.

In 2017, Taiwan recorded 10.7 million foreign visitor arrivals. There has been just one consolation this year: The 10 million milestone was reached two weeks earlier.

Maintaining status quo

We understand that the exercise of power can impact any political party‘s perception of time, but Taiwan opposition and ruling parties should nonetheless agree that time is not on our side and push for a better integration of Taiwan in the global economy.

At the same time, we hope that the ruling DPP would come up with a new strategy to address China’s rise to superpower status instead of playing the China card whenever it chooses.

Even if the ruling and opposition parties cannot agree on the country’s China policy for the next 20 years, they should still admit that time in not on Taiwan’s side.

Most people don’t know, but mainland China accounts for over 40 percent of Taiwan’s exports, of which 80 percent are intermediary goods that are assembled before being sold in China or exported overseas.

Promulgating the New Southbound Policy in 2016 to boost trade and investment ties with the Association of Southeast Asian Nations was for sure a right step in the right direction, but relocating manufacturing in the region cannot be a substitute for discussing trade and investment ties with Chinese authorities.

Taiwan has not signed a free trade agreement with an ASEAN state so far, meaning that Taiwan components are subject to sometimes hefty tariffs by Southeast Asian countries.

On the other hand, Taiwan has already signed one of the most important preferential trade pacts with mainland China -- the Economic Cooperation Framework Agreement -- in 2010; but local politicians have been unable to overcome partisanship.

As long as we keep delaying decisions without a guarantee on better outcomes, however, time will not remain on the Taiwan side.

By Dimitri Bruyas

Dimitri Bruyas is editor-in-chief of the China Post in Taiwan. The Asian Writers’ Circle is a series of columns on global affairs written by top editors and writers from members of the Asia News Network and published in newspapers, websites and social media platforms across the region. -- Ed.

(Asia News Network)