China started investigating the mainland units of Foxconn Technology this week and criticized the firm’s founder Terry Gou for having split the opposition camp in Taiwan by running in the presidential election.
Local taxation bureaus are investigating Foxconn’s manufacturing units in Guangdong and Jiangsu provinces while natural resources departments are inspecting whether the Taiwanese firm’s units in Henan and Hubei provinces have violated any land use rules, the Global Times reported on Sunday.
Indications are that the punitive measures, rather than hurting Gou, have reinforced his efforts to show that his business ties to the mainland do not make him vulnerable to political pressure from Beijing.
Gou’s plan
On August 28, Gou, 72, founder and former chairman of Foxconn, unveiled his candidacy after rejection by the Kuomintang’s Hou You-ih and Taiwan People’s Party (TPP)’s Ko Wen-je of Gou’s proposal to form a partnership.
As Gou does not belong to any political party, to qualify for the race he was required to collect 290,000 endorsement signatures from the island’s 23.9 million population. As of October 4, he had already received enough nominations from the public but he wanted to get more – a chance to to flex his political muscles.
Previously, some voters have said that Gou would not protect Taiwan’s rights because his mainland factories could be taken hostage by Beijing when any conflict arose between the mainland and Taiwan.
Nevertheless, recent polls showed that Gou and his deputy Lai Pei-Hsia, a former singer, have gained support from some young voters from both the TPP and the Democratic Progressive Party (DPP).
Gou’s latest rating surged to 15.8% from 11.7% a week ago, according to a poll conducted by CNEWS, a Taiwanese news website.
Lai Ching-te’s rating fell from 29.7% to 24% while Ko’s dropped from 27.7% to 24.7% for the same period. The rating of Hou stayed unchanged at 16.2%.
Wu Shih-chang, a Taiwanese political commentator, said Lai Pei-hsia has successfully given up her United States citizenship to meet the election requirements over the past one week, boosting people’s confidence in the Gou-Lai team.
The CNEWS poll also said 73.8% of TPP’s supporters wanted Ko to seek to form a team with Gou before approaching Kuomintang. It claimed that either a Hou-Ko team or a Ko-Gou team can beat Lai.
In fact, Ko and Gou have already met in two recent meetings but Gou does not want to be a deputy, Taiwan’s newspapers said.
Gou told the media that there will be a decision by the end of this month.
Beijing is impatient
The Chinese government, which hopes the Kuomintang will lead the opposition camp to replace the DPP, had disguised its preference until it started probing Foxconn’s mainland units this week.
“While Taiwanese companies are enjoying growth dividends and achieving rapid development on the mainland, they should also take corresponding social responsibilities and play an active role in promoting the peaceful development of cross-Strait relations,” Zhu Fenglian, a spokesperson of the Taiwan Affairs Office of China’s State Council, said in a media briefing on Wednesday.
Zhu stressed that China will not change its policy stance, which she described as based on goodwill and sincerity in respecting, caring for and benefiting Taiwan compatriots. She said China will continue to support Taiwanese businessmen and enterprises in investing and operating on the mainland.
One of Gou’s election opponents urged Beijing to take such words seriously. “China should cherish and take care of Taiwanese companies and not force Taiwanese businessmen to change their political stances when elections come,” said Lai Ching-te, a presidential election candidate representing the DPP.
Lai said Taiwanese businessmen have made great contributions to China’s industry and economy over the past 20 or 30 years, and it’s extremely inappropriate to pressure them with tax and land-use inspections.
The Industrial Development Administration of Taiwan’s Ministry of Economic Affairs said it will offer help to Foxconn if needed.
Mainland voices
Chinese media and commentators piled onto the government’s campaign to criticize Gou and his companies.
A Beijing-based writer says in an article published on Thursday that FuJFu, an online financing unit fully-owned by Foxconn, offered loans to blue-collar workers at an annual rate of 36%. He says that in recent years the firm has received 1,413 complaints, mainly related to harassment and overcharges.
“Gou’s election campaign will split Kuomintang’s votes and lead to the collapse of a possible blue-white alliance (a Hou-Ko team),” Yuan Zhou, a military and political columnist, says in an article published on Thursday. “Gou had once said that he was ‘feeding China’ by setting up Foxconn on the mainland. This made a lot of mainland netizens upset. No wonder many people think Gou is a Taiwan independence supporter.”
Beijing wanted Gou to stop his election campaign but used a faulty method, Victor Ng, a former academic in Hong Kong and now a financial commentator, says in his YouTube channel. Ng says Gou does not care if Beijing confiscates all his factories and assets on the mainland as Foxconn has been diversifying its production outside China in recent years. He says China’s probe of Foxconn’s mainland units allows Gou to play the victim card and gain popularity, making him less likely to quit.
Gou, Ko and Hou still have a month to discuss possible coordination as the nominations will end in late November. The election will take place on January 13, 2024.
Read: Foxconn’s Gou has an eye on Taiwan’s presidency
Follow Jeff Pao on Twitter at @jeffpao3