President Tsai-Ing Wen is mindful of Chinese efforts to isolate her country © AFLO/Press Association Images
President Tsai-Ing Wen is mindful of Chinese efforts to isolate her country © AFLO/Press Association Images

What does the future hold for Taiwan?

26 September 2018

There’s an everyday phrase that sums up how many Taiwanese feel about their country right now: “gong gu gyanh dou tei”, which can be translated literally as “stupid turtle going backwards”. In Taiwan, ‘stupid’ is not necessarily an insult. The phrase simply describes the act of taking a retrograde step.

For all practical purposes, Taiwan has been independent since 1950 but, under relentless pressure from its noisy neighbour China (which officially defines the island as a “wayward province”), the country is suffering a serious bout of self-doubt.

Only 17 countries still recognise Taiwan as an independent state. Six of those are small island nations in the Pacific. The only African country to maintain diplomatic relations with Taiwan is eSwatini (as Swaziland is now officially known). China has stepped up its “namefare” campaign, a crusade to persuade other organisations not to call its neighbour “Taiwan”. Earlier this year, it censored 44 websites belonging to airlines that used the T-word and/or showed it was a separate state. IKEA is now facing similar pressure.

The two nations have only co-existed at the Olympics because Taiwan has entered using the name Chinese Taipei. After some citizens demanded a referendum to change that name, the East Asian Olympic Committee cancelled its decision to award the 2019 Youth Games to the Taiwanese city of Taichung.

You might think that China has bigger fish to fry – what with the blowback on some of its Belt and Road Initiative projects in Asia and the Uighur unrest in the western province of Xinjiang – than to obsess about an island half the size of Scotland which, with a population, of 23.7m, is home to less people than Shanghai.

Yet many Communist Party leaders regard Taiwan’s mere existence as a personal affront. Chinese state television recently alleged that the island republic is using “money, love, seduction and internet hook-ups” to turn students into spies before sending them to the mainland. (Ironically, China is credibly accused of using students for espionage in Australia.) Taiwan could also become collateral damage in the messy trade war between China (the destination for 40% of its exports) and the US, traditionally its key military ally.

The demise of Taiwan’s HTC smartphone brand – effectively sold to Google last September for $1.1bn – was another blow to national morale. HTC had been considered the country’s best hope of developing a vibrant global brand.

Global profile remains an issue for Taiwan which usually only attracts global media coverage when China criticises it. The online efforts of the official tourist agency haven’t helped. One Facebook video promoting the country as a holiday destination quotes a young woman as saying, “I can walk around the street without worrying someone wants to rape me”.

All that said, Taiwan has surmounted much greater problems in the past. As Daniel Runde has noted in Forbes magazine: “Without mineral, carbon or agricultural wealth, Taiwan established itself as a dynamic, technologically oriented economy by improving its human capital.”

Taiwan’s government aims to create its own Silicon Valley as a hub for internet of things innovations and is investing in the development of smart machinery, defence technology, biochemistry, healthcare technology, green energy, recycling and next tech agriculture. An ambitious program to improve the nation’s digital infrastructure was also announced last year.

People in other countries may be baffled by the Taiwanese downbeat mood. It generates more GDP per capita than the UK and Canada, unemployment stands at 3.78% and the short-term economic outlook is reasonably good: GDP growth in the first half of 2018 has exceeded 3%. Two promising Taiwanese businesses are proving internationally competitive: innovative electric scooter brand Gogoro and Asus, which is now the world’s fifth largest PC vendor in unit sales.

Yet Taiwan’s president Tsai-Ing Wen, who has been less obeisant to China than her predecessors, is constantly mindful of her neighbour’s strategic effort to isolate her country. The Dalai Lama remains public enemy number one for the Chinese government but Taiwan is probably third on the list – below the Uighur separatists and ahead of US president Donald Trump.

The US has mocked China’s “namefare” campaign as “Orwellian nonsense”, but international relations expert Deng Yuwen has warned that “Beijing is coming to the conclusion that if it is to achieve reunification with Japan, as Chinese president Xi Jinping pledged to do at the 19th party congress, it has to do so by force, and sooner rather than later.” And when Yuwen says “sooner” he means 2020. A more likely scenario is that, while not completely disrupting the status quo, China keeps ratcheting up the tension.

Xi would love to make Taiwan part of a system founded on “socialism with Chinese characteristics”. Yet with more than 4m Chinese tourists visiting Taiwan every year, is it possible that “democracy with Chinese characteristics” could triumph in the long run?

As Runde says: “Mainland visitors see freedom of religion, speech, association, and political competition, along with economic prosperity.” Such visits are powerful reminders that democracy is not incompatible with Chinese cultural identity.

Stranger things have happened in the 21st century.

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