The Magazine

Tear Gas and Running Dogs

The scandal-rocked government of Taiwan.

Dec 4, 2006, Vol. 12, No. 12 • By DAVID DEVOSS
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Mayoral elections in Taipei and the southern port city of Kaohsiung next month are seen as referenda on which party will be better at managing mainland China. The DPP, Taiwan's version of Europe's Social Democrats, has its roots in the agricultural south and reflects the desires of native Taiwanese for a country that exists independent of China. Since becoming president of the Republic of China six years ago, Chen has proposed rewriting the constitution, tried to negotiate with China only on a state-to-state basis, and suggested changing the name of his country from the Republic of China to Taiwan--all moves that enraged Beijing and alarmed Washington, which is pledged to defend the island under the Taiwan Relations Act.

Based in the industrial north, the KMT, whose roots trace back to Sun Yat-sen, subscribes to the mainland's One China philosophy and believes an unspoken pledge never to seek de jure independence is a fair price to pay for permanent peace and a much larger slice of China's booming economy. Says KMT chairman Ma Ying-jeou: "Instead of pursuing a pragmatic path over the past few years, Taiwan has been too 'idealistic' for its own good."

The Kuomintang's main problem, explains George Shuang, president of the Min Sheng Daily newspaper, is that "30 percent of the electorate wants independence." Taking independence off the table, Shuang and others caution, is difficult in a democracy where people control their future. "You can't meet a military threat by giving up the democratic principle of self-determination," says Lai I-chung, director of the DPP's Department of Chinese Affairs.

China may have the capability to crush Taiwan, but there is no evidence it poses an immediate threat. In March 2005, the Tenth National People's Congress in Beijing passed an Anti-Secession Law mandating military force if Taiwan ever declares independence. Ironically, the law backfired. Pro-independence sentiment actually increased following the threat, and China once again emerged as the region's bully.

"Beijing no longer uses harsh words," says Joseph Wu, an Ohio State Ph.D. who heads Taiwan's Mainland Affairs Council. "Today, China's preferred tactic is to suffocate us internationally."

Taiwan is losing the battle for recognition. In recent years, the number of countries with which it has diplomatic relations has fallen from 31 to 24. Last year, Senegal cut ties with Taipei after China promised $600 million in development assistance. The most recent defection occurred this past August 4 when Chad switched alliances just as Taiwan premier Su Tseng-chang was boarding a plane bound for N'Djamena for a state visit. "China wanted the announcement made after the plane was in the air so Su would have to scramble to find a place to land," Wu scowls. "We averted the embarrassment, but it could have been dangerous since Chad was the only country in North Africa that recognized us."

For China, turning Chad around was a twofer: a chance to embarrass Taiwan and an opportunity to secure yet another source of natural resources. It is a pattern Taipei knows well.

China is the main supplier of arms to the Janjaweed fighters in Darfur and, not coincidentally, the prime importer of Sudanese oil. Recently, Beijing began arming rebels in Chad.

"The president of Chad asked us for weapons so its soldiers could fight the rebels armed by China, but we had to say no," recalls a senior official in Taiwan's Ministry of Foreign Affairs. China promised to stop supplying the rebels if Chad agreed to lock Taiwan out, but so far Beijing has not honored the agreement.

Within weeks of expelling Taiwan and establishing diplomatic relations with Beijing, Chad asked Chevron to leave the country. The concession to explore for oil in Chad today is held by the China National Petroleum Corporation.

Diplomatic isolation combined with the mainland's booming economy is causing Taiwan to fall behind its neighbors. Six years ago, Taiwan's GDP was 30 percent of China's. Last year, it equaled only 18 percent of the mainland's. In 1997, the year of Asia's economic collapse, per capita income in South Korea was two-thirds of Taiwan's. Today, Korea's per capita income exceeds that in Taiwan. Indeed, Taiwan's per capita income of $15,291 has barely moved at all since 2000. Six years ago, Kaohsiung was the second busiest port in Asia. Today it ranks No. 7 thanks to double-digit economic growth in China.

Compared with most Western economies, Taiwan's appears robust. Economic growth will top 4 percent this year and unemployment is relatively low. Eighty-two percent of the world's laptop computers, 40 percent of its digital cameras, and 70 percent of LCD screens come stamped Made in Taiwan. Not only does bilateral trade between Taiwan and China exceed $70 billion, but Taiwan also enjoys an annual trade surplus with China close to $30 billion.