Peer Pressure and Fly-bys: China's Taiwan Goals Revisited
China and Taiwan agree that there is only one true China. The problem is that they disagree on who should be running it. (My bet is on the one with the bigger guns).
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This week saw 25 Chinese fighter jets fly into Taiwanese airspace, the latest incident in a series of excursions over the past few months by the Chinese military into Taiwanese controlled areas. The US has warned of an increasingly aggressive China, and debates have emerged as to whether this show of force is meant as a warning to the US or a signal of China’s intentions to reunify with Taiwan.
But wait, I hear you ask, were China and Taiwan ever unified in the first place? Technically, yes. Once they had cleared out all the pirates, the island of Formosa became a prefecture of Fujian province in the mid-seventeenth century, and became a full-blown province in its own right in 1887. Though one could argue that based on recent history Japan has just as much right to stake a claim in Taiwan as does the PRC (they promised America they wouldn’t though), the burning question in the present day is whether the One-China Policy will ever be realised, and if so, will it be based on a PRC or ROC vision?
The One-China Policy is a fairly straightforward idea complicated by the fact that the PRC and ROC governments refuse to be seen agreeing on anything. It essentially states that there is only one state named ‘China’, not two separate states, namely the PRC and the ROC. However, in mainland Chinese communications, the phrase ‘one China principle’ is used almost exclusively, and states that the PRC under the CCP is the legitimate leadership of this united China, and Taiwan is in no way to be recognised as a sovereign state. Of course, Taiwan’s government argues the opposite: the Nationalists who retreated to Taiwan after the civil war were technically never defeated, and so any legitimate Taiwanese government still has sovereignty over mainland China as well as Taiwan. For the purposes of this short newsletter, we’ll be sticking with the phrase One-China Policy where we have to mention it at all.
So what do these expensive, fancy air shows over the South China Sea mean for cross-Strait relations? Are China and Taiwan moving closer to unification? Will the new nation be led by the CCP or will their grand schemes be thwarted by an upsurge in Taiwanese nationalism? Will the revolution be won through military might or through the almighty power of consumerism? Let’s discuss.
A brief history of China-Taiwan relations
If you listen to the Sinobabble podcast (you should, it’s pretty good) you’ll know that following their defeat in the Chinese Civil War in 1949, the Nationalist government set themselves up in Taiwan where they ruled as a dictatorship for the next 40 or so years. The country eventually turned into a democracy in the 1990s, with the Democratic Progressive Party (DPP) established as a rival to the incumbent Nationalists (KMT), and power being passed back and forth between the two ever since.
The CCP has been unable to simply walk into Taiwan and take it by force due to the ROC’s backing by the US military. US support of Chiang Kai-shek’s Nationalist government on the mainland throughout WWII was essentially carried over once the party fled to Taiwan, as the US continued to be afraid of communism (see: the Cold War). US support also allowed Taiwan to become a fast-developing nation and a tech hotspot, though despite their continued ostensible support of Taiwan, all official diplomatic recognition and relations were transferred to the PRC in the late 1970s. The US remains the semi-official ‘third-party’ in all entanglements between the mainland and Taiwanese governments to this day.
In the early 2000s, the CCP felt ready to revisit the Taiwan question once again. In 2004, the State Council’s Taiwan Affairs Office proclaimed that preventing the legal recognition of Taiwan as an independent state was China’s top priority, but it would not actively seek reunification at that time, due to their efforts to characterise China’s growth as a peaceful rise. They solidified this position in 2005 with the Anti-Secession Law, and a consensus emerged between the interested parties (PRC, ROC, USA) to maintain stable, peaceful relations.
The stabilisation of relations meant that China was able to foster an all-important economic bond with Taiwan. In 2008, the “three links” was launched, which allowed for direct flights, shipping, and postal service across the Taiwan Strait, a crucial development in transportation, trade, and communications relations. Since then, economic links between the two states have only grown stronger. Subsequent Taiwanese governments have failed in attempts to divert economic interests away from the mainland due to low costs and similarities in cultures. This has created a strained situation where mutual dependence on economic ties have managed to prevent a political bust-up between the two states, but have ironically caused much tension in Taiwanese domestic politics.
The latest issue to add further fuel to the fire is the question of Taiwanese nationalism. Though KMT-led governments until 2016 steered clear of making a strong statement either way, their DPP rivals have accused them of transforming into the party of reunification and effectively selling Taiwan to China. Now the idea of Taiwanisation - an identity completely separate from that of China - has been gaining traction, especially under Tsai Ing-Wen’s leadership. It is now no longer just a case of unification under one government or the other, but of whether or not a unification will take place at all. As the DPP and other independence movements in Taiwan continue to push the issue of Taiwanese national identity, the question of who has the power to enforce their world view now rises to the forefront.
You can’t spell ‘country’ without ‘UN’
Unfortunately for the Taiwanese, this question may have already been answered about 50 years ago.
Taiwan’s lack of official position on the world stage has not only hurt its ability to negotiate its standing with the PRC, but has also caused other unforeseen problems. In 1971, the PRC replaced Taiwan as the representative of ‘China’ in the UN, with the ROC also losing its position on the Security Council. This was accompanied by a transference of diplomatic relations by essentially all countries from the ROC to the PRC. Subsequent requests for the ROC to join the UN under the name ‘Taiwan’ and not China have been denied.
As it is not a member of the UN, Taiwan is also not allowed to be a member of the WHO. This caused some issues during the covid-19 pandemic, where Taiwan was banned from emergency meetings and denied access to expert briefings. This caused outrage, with Taiwan arguing that at such a time, when global cooperation was crucial, these moves were discriminatory and possibly dangerous. When Taiwan became a leader in the fight against the virus, the WHO refused to acknowledge or discuss the situation, continuing to lump Taiwanese statistics in with China’s.
Taiwan’s precarious status has been leveraged rather effectively by the PRC. Prior to 1971 Taiwan refused to have relations with any country that recognised the PRC, but now the tables have turned, and the PRC refuses to recognise anyone who recognises Taiwan. This pressure extends to seemingly small gestures, for example allowing Taiwanese flags at international sports events, or banning the Taiwanese national anthem during the Olympics, where it competes under the title ‘Chinese Taipei’. But the real problems emerge where China is able to affect Taiwan’s diplomatic and economic relations.
Attempts by Taiwan in the early 2000s to get other economies in South-east Asia to defect to Taiwan backfired and angered the US. Attempts by the island state to try and join economic groups such as the ASEAN and the newly formed Regional Comprehensive Economic Partnership (RCEP) - which includes all ASEAN countries as well as Australia, New Zealand, Japan, South Korea and China - have been continually blocked by the PRC. China has used both aid and threats to prevent countries from establishing independent ties with Taiwan.
All this means is that by international standards, the PRC is seen as more of a country than Taiwan, which appears to have been relegated to ‘place’. With the odds stacked against them, it seems unlikely that even the most popular of domestic independence movements and international solidarity social media groups will be able to convince the rest of the world that Taiwan deserves to be a sovereign state too.
Thus it seems that integration is more likely than the alternative. But will that unity be forged in flames, or does the CCP have the ability to bring about a peaceful M&A deal through its economic prowess alone?
War or economic integration?
In 2014, a student-led movement called the Sunflower Movement broke out in Taiwan to protest the signing of the Cross-Strait Service Trade Agreement, an economic package between the PRC and Taiwan that opened up several sectors in each state to greater investment from the other. Despite the fact that most parties agreed the deal was more favourable to Taiwan than the mainland, the students feared that the PRC would use this agreement as leverage to facilitate moves towards unification.
Despite the failure to meet their goal, the students had cottoned on to something important - despite the disproportionate benefits for Taiwan, China’s influence on Taiwan’s relatively small economy was much greater than whatever Taiwan could hope to achieve. In seeking stability, the incumbent KMT government had admitted that Taiwan’s dwindling influence in regional and global economies meant that reliance on close relations with the mainland were becoming not just desirable, but inevitable.
By 2014, 40% of Taiwan’s trade was with the mainland, with 80% of the island’s foreign direct investment (FDI) going to mainland businesses. Taiwan also has over 100,000 businesses set up on the mainland, and is one of the largest investors in the free trade port that the PRC has established on the island of Hainan. However, while Taiwan's economy has seen the benefits, the people do not necessarily agree. Outsourcing labour to China has meant an increase in unemployment, especially among the younger generation. While Taiwan’s overall unemployment rate is around 3.9%, youth unemployment hovers around 12%. There’s also the issue of increased mainland tourists, who are great for local businesses, but who locals describe as uncouth and spendthrift, causing a social and political rift while economic ties grow stronger.
These economic ties also have the potential to be used as a weapon. With so much of its trade dependent on the mainland, any kind of disruption such as sanctions could easily send Taiwan’s economy into a downwards spiral. Taiwanese companies based on the mainland find themselves subject to frequent random inspections, with companies more supportive of the CCP receiving more favourable treatment. Taiwan’s efforts to relocate investment elsewhere and become less dependent on the mainland, for example with its 2016 “New Southbound Policy”, have yet to make any significant headway.
Military exercises in the area have also sparked panic in the past. In 1996, for example, missile tests by China caused Taiwan’s stock market to plummet. While that case wasn’t deliberate, China certainly has the power to reproduce the effect, and has recently tested these capabilities on other countries such as Australia, as well as individual companies as seen with the Xinjiang Cotton incident.
With such a strong presence in Taiwan’s economy, and the ability to put a strangle-hold on possible external economic relations Taiwan may seek to forge, the PRC clearly has the upper hand. Their ability to massage this relationship into one that transforms Taiwan’s economy into one that is inseparable and thus indistinguishable from the mainland’s will depend on the CCP’s ability to keep a long-term grip on the situation.
No deadline
This long-term view may well be in the PRC’s best interests.
Some observers have begun pointing out that with the ‘fall’ of any semblance of a semi-independent or democratic Hong Kong, it’s just a matter of time before the CCP flexes its muscles and waltzes into Taiwan. But China hasn’t been pushing actively for reunification, instead choosing to focus on preventing the formation of a legally independent, internationally recognised Taiwan, promoting harmonious relations, and stymieing the tide of Taiwanese nationalism. In my opinion, the fighter jets signal intimidation more than impending warfare.
While reunification of all parts of China was identified as a core aspect of his ‘China Dream’, Xi seems to be sticking to the ‘wait and see’ strategy of previous administrations. In 2014, he stated that the main goal for Taiwan was “peaceful reunification; One Country, Two Systems”, adding that “no secessionist act will be tolerated. The path of ‘Taiwan independence’ is unfeasible.” Under the PRC’s long-term ‘boxing in’ strategy, Taiwan’s international influence and legitimacy has been in steady decline. As it continues to be marginalised in international economic and political affairs, it will have no choice but to be drawn ever closer into China’s sphere of power.
While the Taiwanese public seem to be moving towards a more independent stance, bolstered by Tsai Ing-Wen’s more confident leadership, the social sentiment simply doesn’t match up with the economic and political realities (or the military ones). The island and the mainland are moving inexorably closer together, while other countries seem to be moving further away from Taiwan. In the end, China has no deadline, and seems happy to wait for the two to drift together. The rest of us may have to wait another 50 years to see whether or not they finally connect.
Sources
BBC, Taiwan: 'Record number' of China jets enter air zone
BBC, Why Taiwan has become a problem for WHO
Bethany G. Russell, Economic Warfare: China’s Financial Alternative to Military Reunification with Taiwan
Jing Huang, Xi Jinping’s Taiwan Policy: Boxing Taiwan In with the One-China Framework
Laurent Didier,Economic diplomacy: The “one–China policy” effect on trade
Lowell Dittmer, China and Taiwan. Fitful Embrace. (Book)
Nikkei Asia, Taiwan casts net for trade deals as China blocks RCEP entry
The Diplomat, Perfecting Taiwan’s New Southbound Policy
VOA, Taiwan Cannot Compete with China on Aid to Keep Foreign Allies
Wikipedia, Treaty of San Francisco
Wikipedia, Milk Tea Alliance
Yiu Chung Wong, Independence or Reunification? The Evolving PRC–Taiwan Relations