Taiwan’s Leadership Faces Uncertain Future Under China’s Watchful Eye Commentary
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Taiwan’s Leadership Faces Uncertain Future Under China’s Watchful Eye

The world watched as Taiwanese voters cast their ballots to elect their new president on Saturday, the Democratic Progressive Party’s (DPP) Lai Ching-te, Taiwan’s current Vice President.  

The 2024 election poses a challenge for Taiwan, as the nation strives to maintain the status quo and its degree of autonomy as China escalates its military actions across the Taiwan Strait.

Lai’s historic win reflects voter concerns over Taiwan’s fate amid pressure from China and vital domestic issues as Lai inherits the task of balancing tensions with Beijing and advancing defense reforms. The election outcome, closely watched by China and the US, could increase tensions in cross-strait relations as the US reaffirms its “rock solid” support for Taiwan while China courts countries to sever diplomatic ties with Taipei.

The DPP’s victory on Saturday follows two consecutive terms in office for the party. Throughout this period, Taiwan’s President Tsai Ing-wen focused on deterring Beijing while giving top priority to strengthening Taiwan’s defenses. These efforts involved extensive and high-profile military exercises, in direct response to Chinese maneuvers, and a significant expansion of Taiwan’s military capabilities, such as the unveiling of a new submarine last year. China, which views Taiwan as part of its territory, escalated military activities, flying bombers and fighter jets over the Strait as it did on Saturday.

Lai’s position closely aligns with that of President Tsai, and Lai is committed to maintaining the existing status quo. His campaign emphasized a commitment to continuing President Tsai’s policies, although he has occasionally deviated from expectations, adopting a more assertive foreign policy position than President Tsai, as seen in the country’s December 2023 presidential debate.

In Beijing’s view, Lai is considered a separatist and a consistent “troublemaker” due to remarks he initially expressed in 2017 as premier, openly advocating for Taiwan’s formal independence, which Beijing views as a red line. A significant focal point of the Biden-Xi meeting during the APEC summit was President Xi’s wish to unify the island with the mainland, which he deemed “inevitable.” In his New Year’s address, President Xi repeated his statement on Taiwan saying, “China will surely be reunified.” However, President Xi’s biggest problem may be at home, not Taiwan. Nonetheless, reunification may be a “prestige strategy” for the Chinese Communist Party as it struggles with failure at home.

As the dust from Saturday’s celebrations settles, Lai will face the realities of economic challenges at home and a divided legislature. While news networks bustled about China’s threats to Taiwan’s democracy, there was a noticeable lack of coverage on domestic issues.

Saturday’s victory demonstrates the DPP’s popularity, but the absence of a majority vote in the three-way race meant Lai did not receive a clear majority from voters. The Lai administration will face an uphill climb and might need to strategically adapt its approach as it continues many of President Tsai’s policies. 

President Tsai’s approach has led Taiwan to gradually diminish its trade dependence on China and instead welcome other markets. This shift has yielded substantial economic growth and increased domestic investment during the last eight years. Taiwanese manufacturers have shifted their focus from exclusive reliance on low-cost contract manufacturing to the semiconductor sector and exports of information technology products, making the development of high-value, high-margin products the core of Taiwan’s domestic industrial transformation and economic value in the post-COVID-19 era. However, Lai will face the same challenges confronting his predecessor, such as soaring housing costs, a declining national birthrate and a widening wealth disparity. Furthermore, he must grapple with the formidable tasks of boosting wage growth, generating employment opportunities for the youth, and advancing talent development.

If Lai cannot reverse economic issues on the homefront, his administration may have to strategically adjust its approach. Beijing may take advantage of Taiwan’s economic troubles and increase its mix of political, military and economic pressure on the Lai administration while trying to engage with the opposition in the Legislative Yuan. This would complicate domestic politics in Taiwan and escalate tensions between Beijing and Taipei, thus potentially destabilizing the Indo-Pacific security environment.

Despite concerns over soaring housing costs, low wages, inflation, and political weariness with the DPP among young voters, Taiwan opted for the DPP over its rivals, selecting a duo with domestic and international expertise. Lai, who served as Taiwan’s vice president for the past eight years, brings substantial experience in handling domestic matters. His running mate, Hsiao Bi-khim, has a background as Taiwan’s top representative to the US, which bolsters their foreign relations capabilities. Despite voters’ reservations about granting the DPP another term in the executive branch, experience was the decisive factor in this election.

However, no party holds a legislative majority. While the DPP has a plurality, its lead is slowly eroding as the Taiwan People’s Party (TPP) secures some seats previously held by the DPP. There is a possibility that the Kuomintang (KMT), if results remain steady, could secure a plurality. In that case, 2020 KMT presidential candidate Han Kuo-yu could possibly assume the presidency of the Legislative Yuan. No single party will seem to achieve a majority, underscoring the importance of the TPP as a pivotal coalition partner for any party that secures a plurality of seats. 

A divided legislature may impact Taiwan’s relations with China and the US. If different parties have conflicting views on China’s policy, it can be challenging to maintain a unified stance in negotiations or responses to China’s actions. This could potentially create uncertainty and volatility in cross-strait relations.

Effective collaboration with Ko Wen-je, the TPP’s presidential nominee, will be indispensable to prevent legislative gridlock. Despite his unsuccessful presidential bid and absence from the legislature’s membership, Ko holds a pivotal position within his small party as chairman of the TPP. He is poised to exert significant influence over the party’s policy directions in the coming years, including the crucial election of the Legislative Yuan’s president on February 1, 2024, marking the beginning of the next legislative session. The primary challenge for the incoming Lai administration and the opposing KMT lies in vying for the support of the TPP after a fiercely contested election season. Depending on Ko’s stance on specific issues, the TPP retains the flexibility to collaborate with either party.

Given the fluidity and ambiguity of Ko’s platform during the campaign and his populist inclinations, it is challenging to anticipate his positions on domestic and foreign issues. Lai could be forced to adopt a more restrained China policy since KMT and TPP have advocated a more conciliatory tone during their campaigns as they pushed for closer economic ties with China. Lai’s administration will face challenges in advancing its agenda unless it coordinates with the TPP or focuses only on issues with broader consensus. Taiwan’s democratic process of compromise will be put to the test, highlighting the contrast between a democratic system and authoritarian rule across the Strait.

Taiwan showed its commitment to upholding its democratic principles through free and fair elections on Saturday. The people showed their resilience in the face of China’s intimidation, contrary to what Beijing may have hoped for and some concerns held by observers in the US. The rule of law underpins Taiwan’s capacity to maintain its autonomy and exercise self-governance, as it ensures elections are made by procedures and norms decided by Taiwan’s people.

While uncertainty surrounds what China is ready to do with Taiwan, the island heads into an uncertain future, watched closely by the world.

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