As Taiwanese voters prepare to go to the polls Saturday to elect their next president, they are choosing between two candidates who take fundamentally different positions on an issue whose implications go far beyond Taiwan: how to preserve a country’s democracy and freedom while maintaining economic relations with a neighboring giant that wants to subsume it.
With only 2% of Taiwanese supporting immediate unification with China, this is the dilemma that every student, business owner and political leader on the island faces as the price of doing business with China — to accept a different set of values, give up a way of life and agree that unification is Taiwan’s ultimate fate.
As a high-income country, Taiwan is contending with the same challenges many wealthy countries are confronting, including wage stagnation, increasing inequality, asset inflation and aging demographics, accompanied by political polarization. In Taiwan’s case, these problems emerged as it became deeply integrated with the Chinese economy.
President Tsai Ing-wen and the ruling Democratic Progressive Party perceive that closer integration with China — though important for economic growth — carries great risks, because the economic benefits offered by China are actually aimed at absorbing Taiwan. By contrast, the opposition party, the Kuomintang, and its candidate, Han Kuo-yu, are running on a platform that China, the world’s second largest economy, can provide a solution to Taiwan’s socioeconomic problems.
In the last six presidential elections, these two parties attempted to walk the tightrope of safeguarding Taiwan’s autonomy while invigorating its economy, now the 21st largest in the world. Both parties have fallen short of voters’ expectations in this balancing act and, as a result, voters have oscillated between these two approaches to the China relationship. The DPP restricted investments into China in the early 2000s, and then lost the presidency in 2008 to the KMT, which promised to liberalize economic relations with China. This eventually led to a backlash in 2016, when the DPP won in a landslide by gaining the support of young people who were alarmed about Chinese penetration into Taiwan. The upcoming 2020 election may be another turning point where voters choose between very different visions of Taiwan’s future with China and the world.
In trying to solve some of the problems of the high-income trap, President Tsai pushed through long-needed structural reforms on issues such as labor, pensions and energy. She also attempted to diversify Taiwan’s economic relationships. Taiwan estimates higher growth in 2019 than any other high-income Asian economy and enjoys the lowest unemployment since 2001. As for security, Tsai has increased the military budget and is importing more advanced weapons from the U.S. to defend Taiwan against China, which continues to threaten the use of force to compel unification. Finally, she has spearheaded a socially progressive agenda, including making Taiwan the first Asian country to legalize same-sex marriage.
The KMT’s candidate, Han Kuo-yu, has been campaigning on the premise that the DPP leadership has hurt Taiwan’s economy by antagonizing China. After the DPP, which has historically favored independence from China, won both the executive and legislative elections in 2016, Beijing penalized Taiwan by cutting off all official contact, restricting Taiwan’s participation in international organizations, luring countries to de-recognize Taipei and reducing the flow of Chinese tourists.
At the same time, Tsai’s structural reforms were poorly designed and badly implemented, angering a broad range of interest groups. This led to the DPP’s stunning defeat in the local midterm elections of 2018, exemplified by Han’s own victory in the mayoral race in Kaohsiung, a traditionally DPP city. Han’s platform promises to improve relations with Beijing to bring in more capital, tourists and other economic benefits from China.
Tsai’s support, however, has skyrocketed after Chinese President Xi Jinping’s announcement in January 2019 that Taiwan must be unified under the same “one country, two systems” model that has produced months of protests in Hong Kong. So far, the KMT’s message that working with China is the best way to sustain growth does not seem to appeal to young voters, more than a million of whom will vote for president for the first time this week.
In a survey at 37 leading Taiwanese universities, more than 85% of students said they would vote for Tsai, even though only a quarter said they support her party. Young people want opportunities in China without compromising Taiwan’s democratic institutions and are skeptical of both parties’ ability to achieve this result.
Taiwan’s dilemma is not unique. Other high-income countries face similar issues as they forge stronger economic ties with China. But Taiwan’s challenge is particularly difficult because of China’s insistence on political unification. Even as its economy remains deeply dependent on China, Taiwan is struggling to preserve its autonomy and democratic values. As they choose their next president and their new legislators, many young Taiwanese want the benefits of working with China but also believe their values and identity are worth fighting for.
Syaru Shirley Lin is the Compton Visiting Professor at the Miller Center of the University of Virginia and the author of “Taiwan’s China Dilemma.”