Taiwan: Strait Talking


More than sixty years after the establishment of the People’s Republic of China when Chiang Kai-shek’s nationalists fled to the island, Taiwan remains at the core of domestic and foreign policy decisions for Beijing. Despite enjoying de facto independence, having never been directly ruled by the CCP, Taiwan is considered by Beijing to be an inalienable part of its territory and the goal of ‘reunification’ is one of its highest priorities. This is resisted in Taiwan where most people favor retention of the status quo; that is, neither a declaration of de jure independence – a move that would almost certainly provoke an angry reaction from the mainland – nor a move to accept CCP rule over the island. The issue is a sensitive one in China at both the political and societal levels and any suggestion of support for an independent Taiwan ordinarily sparks heated responses from China, which accuses its protagonists of trying to ‘split’ China. It is a complex, emotional, and seemingly intractable problem.

Chinese Annexation and Japanese Colonialism

Taiwan was formerly known as Formosa in the West

Known as the island of Formosa in its past, Taiwan’s history over the past two hundred years has been complex. The largest island of the Formosa island chain located off the southeastern coast of mainland China, it was originally the home of aborigines and the occasional Chinese migrant, refugee, and pirate. Neither Western nor Asian powers showed any sincere interest in acquiring the island until the late seventeenth century, when China brought Taiwan under its authority in order to quell pirates using the island as a base of operations. China largely left the island untouched until the Qing Dynasty was forced to cede the island to Japan after its loss in the First Sino-Japanese War of 1894-5. Qing subjects were given a two-year grace period to sell their property and move to mainland China if they so wished, but very few Taiwanese saw this as feasible and most remained under Japanese rule. An 1895 effort by pro-Qing Taiwanese officials to challenge impending Japanese rule was quickly put down by Japanese forces.

During Japan’s fifty-year control of Taiwan, the occupying government imposed harsh rule on the island, showing no tolerance of dissent, and limiting lucrative jobs and business contracts to Japanese living on the island. Aboriginals and Chinese were treated as second-class citizens. Despite this harsh rule, the Japanese helped to develop Taiwan’s economy and brought with them technology that was unseen on the Chinese mainland. They also helped to enlarge Taiwan’s railroad and other transportation networks, built a widespread sanitation system, and developed the public school system. Rice and sugarcane production also increased greatly under Japanese occupation. Thus, by the end of the World War II the island of Taiwan was much better off than mainland China. That it was largely saved from the ravages of the Japanese occupation that were meted out on the mainland certainly helped in this, but it is an uncomfortable truth for those on both sides of the strait that Taiwan owed its position of relative economic strength to its former occupiers.

The Republic of China

Japanese rule over Taiwan came to an end after they surrendered to the Allies at the end of World War II in 1945. At this time the approximately 300,000 Japanese living in Taiwan were repatriated back to Japan. After Japan’s surrender Taiwan once again fell formally under Chinese rule, which was by this time under by the Chinese Nationalist Party or Kuomintang (KMT), with China now formally called the Republic of China (ROC). Celebration of the island’s return to Chinese rule was short lived. Tension soon built between the locals on the island and their new government. The source of this tension was two-fold. Firstly the KMT government questioned Taiwanese loyalties after their having been subject to fifty years of Japanese rule. The KMT thus continued Japan’s policy of treating the Taiwanese as second-class citizens. Secondly, as the KMT was fighting a civil war with the Communists in China, they took every resource available on the island to support their war efforts.

These tensions culminated in the 228 Massacre of 1947, so called because it occurred on February 28th. What started off as police harassing an old woman who was peddling cigarettes turned into island-wide riots in which local residents attacked mainland immigrants and their property. KMT leader Chiang Kai-shek and Taiwan governor Chen Yi responded by bringing in military reinforcements to restore order to the island. The result was the execution of as many as 4,000 Taiwanese. The 228 Massacre was the start of the nearly four-decade White Terror in which the KMT established a dictatorship over the island and suppressed any organized dissent.

The Chiang Kai-shek Memorial Monument in modern day Taipei

In 1949, Chiang Kai-shek was forced to flee to Taiwan after Mao Zedong and the Communists took control over all of mainland China and founded the People’s Republic of China (PRC). Eventually, 2 million people, most of them soldiers, KMT party members, intellectuals and business elite where evacuated to Taiwan. These refugees brought with them many national Chinese art treasures, as well as gold in foreign currency reserves. Most people on the island believed this would be the end of the KMT as Mao amassed an invasion force in the Chinese province of Fujian, directly across the Taiwan Strait from the island. In addition, the US, the KMT’s largest provider of funds and material, announced it would take no further steps to support Chiang in his fight against the Communists. It appeared that it was simply a matter of time before the PRC would gain control of the island.

The situation changed quickly in 1950, however, when communist North Korean soldiers crossed the attacked the US ally South Korea. US President Harry Truman, fearing communist attempts to take over all of Asia, reversed his policy on Taiwan and sent the US Naval Seventh Fleet into the Taiwan Strait to protect the island from Chinese invasion. This led to a political and military stalemate that is still basically in effect today. Because of the Cold War, most Western nations and the United Nations regarded Taiwan’s Republic of China as the sole legitimate government of China until the 1970s, when the most nations began switching their recognition to the PRC, a response to a thaw in relations with the US that saw it achieve mutual diplomatic recognition by 1978. Initially, Taiwan held the seat on the United Nations Security Council under its formal name of the Republic of China, recognized as the sole legitimate government of all of China. In November 1971, the seat was transferred to the PRC, since which time Taiwan has had no formal representation at the UN despite some sporadic attempts to achieve this.

Taiwan’s accelerated economic growth since World War II has transformed it from a largely agrarian island into an industrialized, developed society. The IMF categorizes it as an ‘advanced’ economy, and the World Bank considers it to be a ‘high income’ economy. One of the strengths of its economy is its advanced technology industry, which plays a significant role in the global economy. Although most of this manufacturing is now outsourced to mainland China, Taiwanese companies still control the production of a large portion of the world’s consumer electronics.

Political Reform


The Sun Yat-sen Memorial in Taipei

Chiang Kai-shek died in April 1975, just over a year before the death of his old foe, Mao Zedong. Chiang’s son, Chiang Ching-kuo, took over. The younger Chiang slowly instituted political reform, allowing more native Taiwanese to enter into the bureaucracy and tolerating limited dissent. One example of the latter was the Tangwai. While the KMT did not allow any opposition parties to develop before 1987, it did allow for candidates to run for office independently. Thus some independent activists and politicians founded the Tangwai. The Tangwai, whose name literally translates as “outside the party”, was a loose coalition of people whose main commonality was opposition to the KMT’s dictatorship. The KMT did occasionally persecute its members, namely in response to a 1979 protest held in the southern port city of Kaohsiung. Nevertheless, KMT leaders largely tolerated the organization.

The Democratic Progressive Party (DPP), the island’s first enduring opposition party, was founded in 1986, a year before such parties officially became legal. The DPP’s makeup was similar to that of the Tangwai in that members were united predominantly in their opposition to the KMT. In fact, the DPP was made up largely of former KMT members. However, within a few years of its founding, the party had established itself as a pro-Taiwanese independence party that promoted a Taiwanese cultural and national identity.

Chiang Ching-kuo died in 1988 and was replaced by his hand-picked successor Lee Teng-hui, the first native Taiwanese to become ROC president and KMT chairman. Lee continued with Chiang Ching-kuo’s reforms, working within the KMT and with activists to open up more government positions to competitive election. For example, the National Assembly and Legislative Yuan, the government’s two legislative bodies, had their first general elections in the early 1990s, and Taipei, the island’s capital, had its first competitive mayoral elections in 1994, which was won by the DPP candidate Chen Shui-bian.

Shi Yali / Shutterstock.com

Taiwan’s current president is the KMT’s Ma Ying-jeou

Taiwan’s democratic reforms continued through the early 1990s and culminated with the island’s first ever direct presidential election, held in 1996. Interestingly, in a world where dictatorial parties tend to get punished in free elections, the KMT’s Lee Teng-hui won what was widely considered to be a fair election. China reacted angrily to the possibility of elections in Taiwan and engaged in military exercises in the Taiwan Strait in a naked attempt to intimidate politicians and voters on the island. The move backfired as it led to the US intervening by sending its aircraft carrier into the area as a warning to the Chinese. The move also appeared to harden both the determination to democratize as well as the opposition to any suggestion of ‘reunification’ with the mainland. Four years later, taking advantage of a split KMT ticket, DPP candidate Chen Shui-bian was elected and succeeded Lee, becoming the first non-KMT president of Taiwan and marking the first change in government brought about by democratic elections anywhere in the Chinese speaking world.

Despite grand hopes that the new ruling party brought with them into office, Chen’s eight years as president were largely disappointing. There were many causes of this disappointment. For example, Chen came to power during a global economic downturn. As Taiwan has an export-based economy, the slump in demand significantly harmed many Taiwanese livelihoods. Additionally, China refused to deal with Chen, declaring him to be a Taiwanese separatist with whom they could not deal. While economic ties between the two sides continued to strengthen, political ties significantly worsened. Another problem lay in people’s expectations of Chen himself. Chen, as president, actually had relatively little power to keep his campaign promises. The power his predecessors enjoyed were largely due to martial law and other temporary revisions the government put in place during the KMT’s dictatorship. As the country instituted democratic reform, many of these presidential powers were taken away and given back to the legislature, where the writers of the constitution originally allocated them. This left Chen mostly powerless to enact some of the reforms he promised. Lastly, many in Chen’s administration, and ultimately Chen himself, were accused of corruption. After Chen’s terms as president ended, he was indicted on charges of bribery and is now in prison serving a 19 year sentence, though he maintains that the trial was politically motivated.

The teahouses of Jiufen

The KMT took back the presidency in 2008 with the election of Ma Ying-jeou, showing the resilience of this once dictatorial party. Ma has moved to improve relations with the mainland, recognizing the futility of antagonizing Beijing and the enormous potential of cross-straits trade, though he has always stopped short of advocating imminent reunification. The KMT remains rhetorically committed to the goal of reunifying with the mainland, though insists that this cannot be under the rule of the CCP. Though this had previously been an unacceptable stance to Beijing it has become the lesser of two evils in contrast to the pro-independence stance taken by many in the DPP. Ma was re-elected in January 2012 with more than 51% of the vote on an impressive turnout of over 74%.

Relations with China

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Taiwan’s army is focused almost entirely on one possible aggressor

Despite having a mature and stable government, a thriving economy, and an active civil society, Taiwan’s status in the international community remains in limbo. The reason for this is the position of China. Beijing insistence that Taiwan is a part of China that must eventually come under Beijing’s rule, whether peacefully or by force, remains a stumbling block for Taiwan in many of its dealings with the international community. Though Taiwan has never made a formal declaration of independence, partly because of the KMT’s stance that Taiwan is part of one China but also because of the fear of serious reprisals from Beijing if it did so, Taiwan maintains its de facto independence. In other words, Taiwan is independent for all practical means and purposes. It maintains set geographical boundaries, a government to rule over lands within those boundaries and this government and its state are recognized by its population. The international realm is not so clear. Other states do recognize Taiwan’s passport but most do no conduct formal bilateral relations with the island, although many maintain links in an unofficial capacity. There are 23 states that maintain diplomatic relations with Taipei instead of Beijing, a reduction from 71 in 1969, the most significant among them being Guatemala, the Dominican Republic and the Vatican. A practice of the PRC and Taiwan competing for diplomatic recognition among states seems to have come to an end; according to a document released by Wikileaks, Panama made moves to switch its recognition to the Beijing but was asked to remain with Taipei in order not to cause diplomatic embarrassment at a time when cross-straits relations were improving. Taiwan is therefore not able to enjoy de jure independence, which means it is not independent according to law. This means that Taiwan cannot join many international organizations that require statehood for membership. These organizations include the UN and the Organization for Economic Co-operation and Development (OECD). Additionally, when joining in other international events and organizations, Taiwan must join under some alternate name, such as its official Olympic title of Chinese Taipei.

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The US continues to supply F16s to Taiwan, despite objections from China

The status of Taiwan cannot be ignored in any aspect of China’s international relations; it is impossible for any state in the international system to have diplomatic relations with Beijing without recognizing the PRC’s sovereignty over the island. This is especially pronounced in the relationship with the US, and in almost every high level political meeting it is incumbent on the representatives of the US to reiterate their support for the “one-China policy”. However, there is a nuance to this acceptance by the US in that it explicitly opposes any actions or statements that would “unilaterally alter Taiwan’s status”. This applies to both Taiwan and the PRC, meaning that Taiwan has an insurance policy in its relationship with the US that ought to deter China from making the first move in any conflict. The special relationship that exists between the US and Taiwan is at the root of this sensitivity, but it is more serious than a linguistic exercise in diplomacy. The US has, on several occasions, demonstrated its willingness to defend Taiwan should it be subject to an unprovoked attack from the PRC. This was evidenced in the 1996 deployment of warships to the Taiwan Strait in response to PRC missile testing in the region. Additionally, the US has continued to meet its legal obligation to provide Taiwan with defensive arms which provokes strongly worded protests from Beijing on each occasion. Since 1990, according to a US Congressional report, Taiwan has requested major purchases in every calendar year except for 2006 and 2009. One of the most recent purchases, agreed in January 2010, included 114 PAC-3 defense missiles and 60 Black Hawk helicopters in a deal worth almost $6.4 billion; one of the largest ever agreed. In September 2011, the US reached a decision to refurbish Taiwan’s fleet of F-16s, fitting them with AESA radars (a form of stealth technology) but stopping short of approving the sale of new planes, but going far enough to anger China. While there are now some calls among American academics to rethink this alliance, it is unlikely to alter in the near future. The involvement of the US seems to assure that the future will be one of an easy maintenance of the status quo. While far from a perfect a solution, this is probably the best option for all concerned.

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China Airlines, Taiwan’s national carrier, now flies direct to the mainland

The period of Chen Shui-bian’s presidency was certainly a low point in cross-straits relations, but the recovery since Ma’s election in 2008 has been impressive and encouraging. Political gestures have been important in this process, most notably the historic visit to the mainland by then-chairman of the KMT, Lien Chan, in 2008. Following Lien’s trip Beijing relaxed rules on Taiwan residents visiting the mainland and on mainlanders visiting Taiwan. The result was a dramatic increase in grassroots exchanges across the strait, with up to 3000 mainland tourists visiting the island every day. Direct flights were permanently established in the same year as Lien’s visit and have expanded consistently ever since, with a total of 558 weekly direct flights between the island and one of 41 cities on the mainland. Taiwanese investment in the mainland is thought to be greater than from any other territory, though the exact figures are obscured by a tendency for the investment to be channeled through tax havens such as the British Virgin Islands. More than one million Taiwan residents – around 5% of the population – now live on the mainland.

Future Trends

Taipei 101 was the tallest building in the world for a time

While maintaining such an unconventional status within the international arena does present some symbolic challenges for the Taiwanese, the situation across the Strait right now remains stable and even mutually-beneficial for both sides. By some measurements, Taiwan is the number one source of FDI into China, providing valuable capital and knowledge from Taiwan’s world-class IT industries. In turn, these economic ties have allowed Taiwanese companies to remain cost-effective even as the island has shifted away from a labor-intensive to a knowledge-intensive economy. These economic ties have also gone some way in tempering Beijing’s saber rattling towards the island. One example of this was seen in 1996 when local officials in Fujian province, an important destination for Taiwanese capital, encouraged Beijing to show restraint during missile tests in the Strait, lest they scare off investors from the island. While CCP leaders say that economic factors would not deter an attack on the island if warranted, the prospect of the flight of Taiwanese capital from China certainly raises the potential cost for any Chinese action.

Although most states in the world continue to pay lip service to China’s ‘one China’ policy, they also maintain informal relations with Taiwan in their day-to-day affairs, particularly in the economic sphere. The US, in particular the US Congress, is Taiwan’s most ardent and powerful supporter. The involvement of the US and the potential for a conflict between to the world’s two greatest powers means that the cost of China acting unilaterally with regard to Taiwan is high, though the complexities of the forces competing for influence in China over this issue mean that it cannot entirely be ruled out. Oddly, one of the most potent sources of political tension in the region – the dispute between China and Japan over the Diaoyu/Senkaku islands – has provided an opportunity for improved relations between China and Taiwan, since both share a rhetorical position on the matter. Nevertheless, the most likely future path for Taiwan and its relationship with the mainland is one of an uneasy maintenance of the status quo; it is in neither side’s interests to act unilaterally and the scope for common ground is too narrow to allow an agreement to be reached in the foreseeable future. Taiwan will not gain the independence that some of its people seek, but it is unlikely to be swallowed whole by China any time soon.