The run-up to Taiwan’s January election has kicked into high gear, as hundreds of thousands of supporters and opponents of Kuomintang (KMT) presidential candidate Han Kuo-yu marched on Saturday in the streets of Kaohsiung, southern Taiwan, where Han is the mayor. The pro-Han camp marched in northern Kaohsiung to garner support for his bid to unseat the Democratic Progressive Party (DPP) incumbent Tsai Ing-wen in the January 11 election, while the anti-Han rally took place in the southern part of the city, urging his recall as mayor and expressing their dissatisfaction with his representing the KMT against Tsai after only months as Kaohsiung mayor.
President Tsai stressed that she had laid the foundation for Taiwan in the past three and a half years of governance, calling on constituents to give her four more years to strive for the nation. However, an opinion poll released by United Daily News on December 14 indicated that only 23% of the respondents thought that Taiwan had seen better overall development under the DPP’s governance, 30% believed the opposite was true, while 38% thought the situation was nearly the same as before the DPP came to power. In addition, a mere 13% of the respondents said the people of Taiwan led a better life, 29% believed the opposite was true, while 49% thought the situation was practically unchanged.
The electoral campaign has entered a crucial moment, as the Tsai government is forcefully playing the anti-China card. With the catalysis of the protests and demonstrations over the amendment bill to the Fugitive Offenders Ordinance in Hong Kong, it has all the more been pandering “a sense of losing one’s country,” while commenting here and there on the Hong Kong question, thus being considered by the other side of the Strait as “external forces” on a par with the US.
Since the Tsai government came to office, it has restricted cross-Strait investments, coupled with the New Southward Policy, proclaimed as an effort to reduce economic reliance on China, but after implementing the policies for close to four years, the effect is zero, as reliance of Taiwan’s exports on China has actually increased to 41%. As seen from this, the DPP’s plan to use political force to lower the reliance of Taiwan’s economy on China can never succeed. The pragmatic approach is to handle cross-Strait relations properly, never allowing the economy to be impacted by negative cross-Strait ties.
Some believe the current trade war with the US will devastate China’s economy, thus delinking Taiwan’s economy from the mainland. However, this will not happen, because the structure of China’s economy has changed, with exports occupying less than 20% of gross domestic product, and exports to the United States occupying 20% of the entire export volume, coupled with the fact that large-scale economies have greater room for maneuvering, so although trade wars do have an impact, it won’t devastate China’s economy.
Conversely, in the unlikely event that China’s economy really collapsed, it would truly be a disaster for Taiwan’s economy. China’s economy is 20 times the size of Taiwan’s; China’s market occupies 40% of Taiwan’s exports, while Taiwan enjoys a trade surplus of more than US$80 billion. If a similar trade war should occur across the Strait, there is no doubt whatsoever that the Taiwan economy would immediately be mired in decline, while the effect on China would be minimal.
For the election campaign, the Tsai government has been claiming that Taiwan’s economy is performing extremely well, but in reality is very different. Speaking at a news conference, Department of Statistics director general Beatrice Tsai attributed September’s negative export growth to the ongoing trade spat between Beijing and Washington, which has eroded global economic momentum, and private-sector investments are in the doldrums, growing by a little over 2%.
In the cross-Strait economic race, Taiwan has lost; to sustain growth, it should seek complementarity with China’s economy. On the contrary, for winning the election, Tsai uses cross-Strait relations as a sacrificial offering; in fact, it is using the future of Taiwan’s economy as a burial sacrifice.
Tsai is running for president for the third time, having served in the post for three and a half years. As a national leader, she should have pursued macro-thinking, planning fundamental policies based on considerations of the big picture. However, her government, based on electoral considerations, has been catering to pleasing the public. With just three weeks to go until the presidential election, observers are largely in agreement: Tsai’s ability to seize more votes in constituencies lost to the KMT last year will be the decisive factor in her re-election bid.
In a joint rally in Hsinchu city on December 7, Han indicated that over the past three and half years under the Tsai administration, the people of Taiwan used four words, “suffering, vexation, upset, and chaos,” to express their feelings, adding that if Tsai were allowed to continue in power, the coming four years would be disastrous.
In his 1991 book The Four Little Dragons, American academic Ezra Vogel argued that Taiwan was a newly industrialized economy that had followed Japan’s export-led growth model to prosperity. Unlike major advanced economies, which established their position in a century or two, Taiwan made its mark in just a few decades. But the once high-flying Taiwan is plunging in a downward spiral. The decay of its once entrepreneurial, technology-driven economy is in plain sight, worming its insidious way into multiple sectors.
Tsai is facing a very, very difficult re-election challenge. If next month’s election is a referendum on President Tsai, she’s probably going to lose.