Last weekend, Taiwan witnessed one of the most important elections held in the country in past four years. Incumbent President Ma Ying-jeou defeated opposition candidate Ms. Tsai Ing-wen by 800,000 votes in the January 14 election. By winning 51.6 percent,or 6.8 million of entire votes, President Ma and the ruling Kuomintang (KMT, Nationalist Party) secured a second four-year term in office, ending the Democratic Progressive Party's (DPP) hope for a return to power. In the parliamentary election also, held on same day, KMT maintained majority by winning 64 seats out of 113, while DPP won 40. Two smaller parties, People First Party (PFP) and Taiwan Solidarity Union (TSU), also made substantial gains by winning three seats each in proportional representation sectors.
Many observers interpreted the election results to be Beijing's victory, as the Chinese government had never concealed their preference for Ma. Certain Taiwanese media even attributed DPP's failure to Tsai's pro-independence stance during the campaign. Indeed, since Ma was first elected into presidency in 2008, his government has adopted several unprecedented policies to improve relations with Beijing, including resuming semi-official talks, establishing regular cross-strait flights, and allowing Chinese tourists to visit Taiwan. In 2010, in spite of vehement opposition by the opposition camp, KMT government even signed the Economic Cooperation Framework Agreement (ECFA) with China, a free trade agreement aiming at establishing a closer economic partnership with China and integrating Taiwan's economy into the booming Chinese market.
Ma's policy did create an image in Taiwan and elsewhere that the KMT is in favour of seeking greater economic cooperation with the mainland, even though policies as such will sacrifice Taiwan's security and dignity. Throughout the election campaign, Ma stressed that his China policy was based on two principles: "maintaining the status quo across the Taiwan Strait" and "one China, respective interpretations". The latter one - referred to by the media as the "1992 Consensus" (under which both sides agreed to disagree over how to define "One China") - was particularly opposed by Tsai. However, neither Tsai nor the DPP made a concrete proposal on how they would deal with Beijing once they win the election. From this perspective, Tsai and the DPP lost the election not because they adopted a pro-independence stance, but because they failed to propose a formula that is more attractive to the voters than Ma's "status quo" and "1992 consensus."
Since the KMT will remain in power in the next four years, its policy toward Beijing -seeking closer economic ties while reducing hostility - is likely to continue. Nevertheless, Ma also faces certain challenges. Whether his government can respond to these challenges properly will not only determine the fate of the island state, but also affect the power structure and security environment in East Asia.
First is whether Ma will start political negotiations with Beijing in his second term. Chinese leaders wish the KMT to stay in power because they are convinced that Ma also accepts the principle of One China. Yet, accepting "One China" does not mean Taiwan will accept the formula of "One Country, Two Systems" proposed by Beijing, which will downgrade the political status of Taiwan to that of Hong Kong and Macao. Ma himself has been extremely careful in talking about Taiwan's future status as any proposal on ultimate unification with China is considered as a political suicide in Taiwan. Beijing will surely force the KMT to negotiation table in next four years while the Taiwanese society is unlikely to reach a consensus on the issue. In this scenario, Ma and his KMT government will be in a difficult position, and if not handled well, could lose trust from either the Taiwanese public or Beijing.
The next is Taiwan's foreign policy and strategic posture. Although China is rising to be a new superpower in East Asia, economically and militarily, its relations with neighbours are hardly amiable. Territorial disputes with Japan and India remain barriers to a true reconciliation between China and these two giant neighbours. China's assertiveness in South China Sea in recent years also face strong reactions from ASEAN countries like Vietnam and the Philippines. If the KMT government continues to place reconciliation with Beijing as top priority and does not oppose China's militarism, it will create an image - at least among her Asian neighbours - that Taiwan is going "bandwagoning" with Beijing. It will further place Taiwan in a more isolated position and reduce international support for Taiwan as a bulwark against China threat.
Finally, so far Ma and his government have been unable to find a better way to reduce Taiwanese firms' investment risks and enhance personal safety in China. Today Chinese market absorbs 30 percent of Taiwan's annual exports, compared to 16.8 percent a decade ago. Taiwanese investment in China, estimated to figure at US$80 billion, accounts for more than 60 percent of Taiwan's approved outward investment in accumulation. It is estimated that over one million of Taiwanese citizens are working in China. Given that Chinese economy will continue to grow at a rate of 8 or 9 percent, this trend is not likely to change in near future. However, increasing social unrests in Chinese society, uncertainties of its political future, and high crime rates in certain cities, still haunt Taiwanese investors. Although ECFA has been put into practice for a year and half, there exists no formal agreement between the two sides on protecting Taiwanese citizens, their properties and investments in China. Business leaders in Taiwan have long been calling for signing a bilateral investment treaty (BIT) with China. Both sides even negotiated for a while, but there is no sign of breakthrough yet. In other words, Ma will face more pressure from investors and business communities, demanding more concrete safeguards and regulations in the future.
The election results show that the voters have endorsed Ma's policy of maintaining good relations with Beijing. But whether such strategy will further make Taiwan safe remains unclear. Yet one thing is for sure: how a democratically elected leader deals with a hegemonic and authoritarian neighbour will continue to be a hot issue for policy-makers as well as academic scholars in the next four years.
(Dr. Mumin Chen is an Associate Professor at the Graduate Institute of Political Science, National Chung Hsing University, Taichung and member of international affairs section, Taiwan Think Tank, in Taiwan. He is currently a Visiting Fellow at Observer Research Foundation, New Delhi).
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