By Emma Emeozor
Taiwan’s new president, Lai William Ching-te, is not bothered walking a tight rope between boosting the economy and holding back China’s threat to the Island. He is confident of delivering his electoral promises. Issues on the front burner of his administration include: Taiwan’s relations with China, strengthening ties with the United States, addressing geopolitical frictions over trade and technology. Others are foreign affairs, national defense and cross-strait affairs
His confidence is informed by the fact that he has a clear understanding about national policies and the direction of governance followed by his predecessor, President Tsai Ing-wen. According to him, his predecessor told him that “public opinion, national security and upholding the nation’s constitution” are key determinant to the success of the President.
“She emphasized to me that the President’s first job is to safeguard the country and uphold the constitutional system of freedom and democracy. Second, we must listen to public opinion and take care of the people. Third, faced with difficult challenges, we should collectively discuss a course of action forward. This way there will be less impediments.”
But if there is less impediments for the president internally, how about some of the Island’s foreign allies that are unreliable? “We cooperate with our diplomatic allies in a sincere way, holding to the principles of mutual benefit and reciprocity, in a recent media chat.
He is confident that the “harmful actions” of diplomatic allies who decide to swap allegiances to China, will not affect Island’s status as “a beacon of freedom and a bastion of democracy in the world,” adding that Taiwan was not deeply worried “on this issue of recognition.”
Lai was quick to reiterate his inaugurate comment on Taiwan’s dignity and equivalence with China. He insists that Beijing must accept the fact that Taiwan (Republic of China) exists and therefore it “should be sincere in building exchanges and cooperation” with his administration, being “the popularly-elected legitimate government of Taiwan.”
It was a clear message when Lai said: “Each issue should be mutually beneficial and reciprocal” to both Taipe and Beijing. “As we conduct exchanges and cooperate with one another, we should share a common conviction to enhance the well-being of people on both sides of the Taiwan Strait, working toward an objective of peace and mutual prosperity, he added.
Recall that China reacted angrily to Lai’s inauguration speech when he said that Taiwan and China are not subservient to each other. Lai insists that what he said was the “truth.”
He told Times that “What I said was the truth. Moreover, I was not the first person to express this truth. My intention was not to provoke. During her 2021 National Day Address former President Tsai said as part of her Four Commitments that the ROC and PRC are not subordinate to each other.
“Former President Ma Ying-jeou had also once said the ROC is a sovereign and independent state and that neither side of the strait is subordinate to the other. Third, I stated this in accordance with Articles 2 and 3 of the ROC Constitution, given that on Taiwan we have our own people, land, sovereignty, and government. According to international law, we are already a sovereign and independent country. My goal is to bring the people of Taiwan together.”
Some observers are already asking how Lai would deal with Chinese President Xi’s impatience about resolving the Taiwan issue. But the President has an answer, noting that “peace and stability across the Taiwan Strait are indispensable elements of global peace and prosperity.”
Lai is conscious of the pledge he made to the international community in his inauguration speech: that he would uphold his predecessor’s “Four Commitments.” He says “We will neither yield nor provoke. We will maintain the status quo and fulfill our responsibilities.”
He wants the Chinese president to “understand that conflict in the Taiwan Strait and disruptions to peace and stability in the Indo-Pacific region will not be accepted by the international community,” just as he requested the Chinese leader “to jointly shoulder with us the responsibility of maintaining peace and stability, building regional prosperity, and advancing world peace.”
China’s economy is currently experiencing crisis. Experts seem divided over the impact China’s economic problems could have on Taiwan. While some say it could make the Island vulnerable, others believe it is an opportunity for the duo to work together for mutual benefit.
But Lai thinks differently. He says a stable China leads to a safer Taiwan while a prosperous Taiwan can also bring about progress in China. This is even as he wishes to see a growing economy in a more stable society in China.
But what does he think about economic relation between China and Taiwan? He said: “Indeed, economic relations between Taiwan and China are the result of divisions of labor within global supply chains. In the past, China was the world’s factory as well as the world’s market.
“Further to Taiwan, many countries invested in manufacturing in China and sold products manufactured at home via China to the entire world. But today things have changed because China’s business environment has worsened.
“China has placed ever stricter controls on the free market. They have adopted a policy of placing state-owned businesses first, at the expense of the private sector. China’s intellectual property rights protection has also long fallen short of international expectations.
“In addition, China’s military expansionism in the East and South China Seas has impacted regional peace and stability. This is why capital investment from Taiwan and other countries is no longer heading to China at the pace it was in the past. Taiwanese companies have pulled out of China’s manufacturing sector en masse, favoring countries in the Indo-Pacific, including Japan, the United States, and Europe.
“In 2010, investments in China accounted for 83.8% of Taiwan’s total foreign investment. During the same period of time, over half of Taiwan’s foreign trade was dependent on China. Parts and equipment produced in Taiwan were sent to China for assembly or used in the production of other goods, and then the finished products were sold internationally.
“Last year, investment in China accounted for only 11.4% of Taiwan’s total foreign investment. Taiwan’s foreign trade with China also fell from its previous high of over 50%, totaling 35.5% in 2023. Despite this, Taiwan’s economic growth rate has averaged 3.15% over the past eight years, ranking first among the Four Asian Tigers.
“During former President Tsai’s eight-year term, the stock market grew by 155.5% and its value increased 1.8-fold. When former President Tsai first assumed office, the stock market was a little over 8,000 points; it has now surpassed 20,000 points.
“In other words, even as China’s economy has continued to decline, Taiwan’s economy has continued to grow and has not been affected by China. Taiwan’s new government is willing to assist China and advance peace and prosperity across the Taiwan Strait.”
On the risk of denying China access to Taiwan semiconductors following United States export restriction, Lai said: “In this era of smart technologies, semiconductors have become crucial industrial products. In the future, if all aspects of life including food, clothing, housing, and transportation are to be technologically advanced and intelligent, semiconductors will be indispensable.
“The industry runs on a global division of labor. From research and development, design, manufacturing, raw materials, and equipment, it is a worldwide industrial chain. Taiwan is involved in integrated circuit design, wafer manufacturing, and end-of-line packaging and testing, but raw materials are distributed across other countries.
“For example, components, equipment, and technology are sourced from the United States, Japan, and the Netherlands. As we can see, this is an industry with a global division of labor. Although Taiwan has an advantage in the semiconductor industry, Taiwan also has a responsibility to promote global prosperity and development.
“Consequently, if semiconductor companies, including Taiwan Semiconductor Manufacturing Company (TSMC), decide to expand in the United States, Japan, Europe, or other countries consistent with their own business interests, the government will respect their decisions.
“Geopolitical changes will continue to impact the dispersion of semiconductors companies. Given that the restructuring of global supply chains is not specific to any single country, I do not believe that this will increase the risk of conflict.
Beijing has ruled out holding dialogue either with Lai’s administration or his political party, the Democratic Progressive Party (DPP). But the president is not troubled. He has answer for China and those who are thinking the stance of Beijing will cow Taipe and indeed Taiwanese to capitulate to China’s threat. “The people of Taiwan and all political parties, regardless of affiliation, should recognize and respond to the PRC’s core objectives of annexing Taiwan.
“Only by coming together domestically and strengthening our global linkages can we maintain our sovereignty, freedom, and democratic way of life. By doing so, we will have the capacity and opportunity to determine our own future. No political party should sacrifice national sovereignty for political gain.
In April 2024, the Hualien district of Taiwan experienced devastating earthquake. Responded, offering aid to the victims but the government of Taiwan rejected the offer. Lai offered reason for the position of the government where he served as Vice President.
“Taiwan very much cherishes the expressions of concern and support it received from the global community. International assistance creates a positive feedback loop that helps us come together at times of need. This helps support global development and stability.
“With this being said, at the time, China had offered 100 prefabricated homes, which was not what the people affected by the Hualien earthquake required at the time. When central Taiwan was struck by a strong earthquake on September 21, 1999, the government had provided such homes to alleviate housing shortages at the time.
“However, over the past 20 or 30 years, Taiwan has accumulated greater experiences and capacities with search and rescue and post-disaster reconstruction. We have moved past the period of requiring prefabricated housing.”
The resumption of negotiation for the cross-strait service trade agreement (CSSTA) has remained a topical issue. Some observers have argued that it will enable Taiwan-China close economic integration. But Lai think otherwise when he said that “the time for this has long passed.”
Giving insight to his position, he said, “Many Taiwanese businesses have left China. Looking ahead, we can see substantive differences opening up between Taiwan’s economy and China’s present economic structure.
“If the CSSTA were passed, Chinese business owners could come to Taiwan and set up shop with as little as six million NT dollars. And it is not just a matter of the owners, they could also bring employees over. This would greatly affect Taiwan’s local economy.”
Lai was resolute when he commented on Beijing’s lobby of the Global South to back its push for Taiwan reunification with China “I hope that all countries will respect the choice of Taiwan’s people. The will of the people should not be subject to decisions made by a majority or show of hands (in international for a). Neither should our people be threatened by violence or the threat of war.
“China is presently engaged in lawfare, which is affecting support for Taiwan internationally. While Taiwan will do its best to speak up for our own rights and interests, I hope that the international community will also continue to assist, understand, and support Taiwan. This is because if China’s attempts at lawfare were to succeed, this would affect Taiwan’s global backing, be it in times of peace or war.
“Domestically in Taiwan, a lot of people are struggling with a growing but slow economy, rising prices, and stagnated wages. What is your plan to try to help the average Taiwanese person?
I have been deeply focused on supporting the salaries and lives of our grassroots workers.
“I also prioritize reducing the gap between the rich and poor, as well as efforts to give our young people a brighter future. I will faithfully implement the Minimum Age Act that was passed under President Tsai Ing-wen. With this act, minimum wage increases will be based on how the GDP or prices increase. More importantly, we must help our industries upgrade and our economy transform.
“In my inaugural address, I said that economic development will take a threefold approach. First, we will have a clear vision for a smart, sustainable future. In other words, we must use technology to address climate change and respond to the global era of smart technologies. We will have an innovative economy and create a new Taiwan that is both smart and sustainable.
“Second, we will expand the space industry, exploring the future by developing medium- and low-orbit satellites and drones. We will also use our strengths as a maritime nation to explore the ocean, helping related industries grow and develop in many directions.
“Third, we will help our enterprises expand their presence and markets internationally. We will improve Taiwan’s investment environment and take care of our small and medium-sized businesses while helping our industries deploy all over the world.
“This will grow Taiwan’s economy, leading to development and creating an environment conducive to higher wages. During my election campaign, I put forward a National Project of Hope. With this, we will invest more in our society, take better care of both young and elderly people, as well as all those who need care. We will alleviate the wealth gap, while supporting the people’s welfare and the future of our young people.”
Though Lai’s party, the DPP won the presidency, it failed to win majority seats in the Legislative Yuan (Taiwan’s Parliament). This development has afforded the opposition parties advantage over the ruling party in legislative matters. Some analysts have argued that this will create ‘political discomfort’ for the presidency. But Lai understands the implication of the opposition parties controlling the parliament. However, he remains confident that it will not slow down the Island’s development.
“I remain fully confident about the future development of Taiwan. This is because of our democracy. After decades of collective effort, as well as the numerous sacrifices and contributions of many people, the vitality and values of democracy are deeply imbued within the Taiwanese people. These democratic values are an important foundation as I promote future national policy priorities.
“In my inaugural address, I mentioned that a divided legislature is the will of the people. This provides an opportunity for each party to share their ideas and jointly bear the responsibility of serving the nation. At the same time, if any one party does not live up to public expectations, I trust that people will respond accordingly so that the country can still move forward.
“In my address, I also pointed out Taiwan will continue to move in the direction of democracy, peace, and prosperity, linking us with the international community.
“I will pursue policies that further entrench Taiwan’s democracy, maintain regional peace, and allow Taiwan to engage with the international community to enhance global prosperity and development. This roadmap will benefit both our country and its people. I do not think opposition parties will strongly oppose bills related to this roadmap.”