March 2006
Who Decides Taiwan's Future?
Over the past half century, Taiwan has emerged as what President George W. Bush has called a "free and democratic and prosperous" society. It has one of the world's richest populations and a robust democratic policy. But Taiwan continues to face major challenges, including ongoing difficulty in consolidating democracy in the face of highly partisan politics, a significant threat from the opposite side of the Taiwan Strait, and fragile economic growth. How can Taiwan break through political gridlock on governmental reform and defense spending? How can the United States and Taiwan work together to ensure the island's security? What are the obstacles to an even more prosperous economy and vibrant society on Taiwan? Who, ultimately, will decide Taiwan's future? On March 22, AEI and the Heritage Foundation hosted Ma Ying-jeou, mayor of Taipei and chairman of the Kuomintang, who answered these and other questions.
Ma Ying-jeou
Mayor, City of Taipei, Taiwan
The changeover of power in 2000 when the Democratic Progressive Party (DPP) became the ruling party of Taiwan resulted in high expectations of President Chen Shui-bian. Chen's initial approval rating of nearly 80 percent can largely be contributed to the list of "five no's" for managing cross-Strait relations that he initially declared during his first inaugural address, for example. However, over the past six years, things have changed significantly, and Chen's popularity has sharply declined.
In March 2005, the Chinese mainland adopted the Anti-Secession Law. However, as mainland China has never been noted for its adherence to the rule of law, it does not need a piece of law as the basis for launching an attack against Taiwan. The Anti-Secession Law is undesirable for three reasons. First, the reasoning behind the law is based upon a complete misunderstanding of popular opinion in Taiwan. In Taiwan, only a small minority promotes de jure independence for Taiwan, while the vast majority, including the president, supports maintaining the status quo. Second, as with all cross-Strait matters, issues of secession and independence should be decided bilaterally, not unilaterally. Third, all cross-Strait matters should be conducted by peaceful means.
Over the course of six years, the great expectation that initially surrounded the Chen administration has eroded into stagnation, and has ultimately resulted in confrontation--largely due to a number of actions by Chen, as well as the passage of the Anti-Secession Law. Politically, the relationship across the Taiwan Strait has been somewhat bumpy since the year 2000.
On the other hand, the economic relationship has continued to boom regardless of political issues. First, in 2005, bilateral trade across the Taiwan Strait reached $71 billion, with Taiwan having a trade surplus of $49.7 billion. Second, the accumulated amount of investment of Taiwanese businesses on the Chinese mainland is estimated at $100 billion, but could be as high as $170 billion. Third, there are around 1 million Taiwanese people living, working, or studying in mainland China. Thus, looking at cross-Strait relations from a historical perspective, this is probably the first time in history that the two sides have had such strong economic ties.
But despite the boom, there are clouds ahead. Ten ASEAN countries are working toward a free trade agreement (FTA) with China that could be followed by FTAs with Japan and South Korea. If Taiwan cannot become part of ASEAN, its economic development will decrease by one full percentage point. Taiwan will be faced with a "hollowing out" effect that will result from Taiwanese companies moving their factories to the mainland to avoid higher tariffs. If Taiwan continues to be left out of regional economic integration, its economy could be in serious trouble.
The origin of the problem lies in the serious lack of mutual trust across the Taiwan Strait, resulting in the inability to find a common ground for negotiation. The second problem is the lack of consensus, both within Taiwan itself and across the Taiwan Strait. Third, there is a lack of shared vision for the future, particularly in regards to the "one China" policy. However, the Kuomintang (KMT) already took care of this issue with the 1992 Consensus reached between Taiwan and mainland China, which indicated "one China, different interpretations." This consensus could serve as the basis for discussions in the future.
Should the KMT return to power in 2008, it would handle cross-Strait issues quite differently than the DPP has done. First, the KMT will resume the interrupted negotiations based on the 1992 Consensus. Second, the KMT will try to reach some sort of peace accord lasting anywhere from thirty to fifty years to formally terminate the state of hostilities across the Taiwan Strait. Third, the KMT would like to normalize the economic relationship across the Taiwan Strait. Fourth, the KMT will promote greater international participation of Taiwan by developing some sort of modus vivendi for Taiwan to conduct its international affairs. Fifth, the KMT will attach great importance to cultural and educational exchange.
In terms of relations with the United States, it is necessary to remember that the KMT's proposals are intended to maintain the status quo. Taiwan should not pursue independence from mainland China. On the other hand, Taiwan should not pursue immediate unification either. Thus, the best policy for now is maintenance of the status quo. This is compatible with the U.S. security role in East Asia. By improving relations with the mainland, Taiwan could help stabilize the situation in East Asia, and the U.S. role in the region could be made easier. While Taiwan still needs the United States to help Taiwan maintain an adequate defense capability, the United States will be much less likely to be involuntarily drawn into a major war with mainland China. Thus, the security relationship between Taiwan and the United States will be enhanced and become more stable, to the interest of both sides.
The best approach for Taiwan is to maintain good relations with the United States, Japan, and the mainland at the same time. Taiwan should be peacemaker, not a troublemaker. Taiwan wants to become a responsible stakeholder in East Asia and does not want to rock the boat in regional waters. Thus, if the KMT comes back to power in 2008, it hopes to make the policy previously described into a reality.
AEI intern Karla Herdzik prepared this summary.
