The decisive victory of Democratic Progressive Party (DPP) Chairperson Tsai Ing-wen in the Presidential elections in Taiwan was unexpected. Pre poll surveys had predicted a victory but the huge margin of votes with which she defeated the incumbent President Ma Ying-jieu has surprised everyone.

The DPP has also won an overwhelming majority in the 113 seat legislature.

This is a big change in Taiwan’s political set up. The country was ruled by the Kuo-min Tang (KMT)--the National People’s Party-- till martial law was lifted in 1987. Even thereafter, the KMT was successful in forming the government till 2000 when DPP wrested power from it for the first time. DPP retained power till 2012 but it was always hampered throughout by the thin majority in legislature. With this thumping elections win, the party has absolute support in the country which places huge responsibility on it.

One of the reasons the KMT has been thoroughly rejected is, young Taiwanese view the party as overtly Beijing-friendly and a supporter of the ‘1992 consensus’. The consensus refers to a supposed understanding reached during cross-strait talks in 1992 wherein both China and Taiwan recognize a ‘one China’ policy with each side allowed to have its own interpretation of what that means. The DPP has not openly acknowledged the existence of one China policy.

Despite the DPP’s overwhelming victory, Taiwan’s politics will remain mired for some time under shadow of the historical hand shake between Xi Jinping and Ma Ying-jieu in November 2015 and its implications for Taiwan and regional geo-politics. Though both leaders met in a third country--Singapore--and addressed each other as Mister instead of the President, the general impression in Taiwan is that President Ma has compromised Taiwan’s sovereignty. Young people in particular feel that closer trade and political relations with the Peoples Republic of China (PRC) would make Taiwan overly dependent on the mainland, diluting Taiwan’s call for independence. The KMT however believes that it was an important step towards promoting peace in the region and allowed the top leadership in Beijing become aware about the aspirations of the people of Taiwan. The leaders formally consolidated the 1992 Consensus, in which both sides insist on ‘one China’ but agree to disagree on what that means in a practical sense. For Taiwan, it means Republic of China that relocated to Taiwan in 1949.¹

Maintaining sound relationship with China will be the primary challenge to the new President. Tsai Ing-wen while outlining her approach toward cross-strait relations has reiterated that the party’s basic principle for managing ties between the two sides is to maintain status quo and any forward movement in the relationship will be in accordance with the will of the people². She will have to exercise restraint and refrain from acts that may intensify tensions in the region. A move away from parochial politics and confrontation to enhanced communication can be mutually beneficial. It must be well understood that people in Taiwan and China have blood relationship with relatives on both sides and close cultural and emotional bond.

While dealing with PRC, Ms Tsai will also have to consider the opinions within her own party. One of the legislators of her party Huang Wei-cher has said that Tsai has moved the DPP’s rhetoric toward the center of the political spectrum by promising to maintain the status quo, even though the goal of Taiwan’s independence remains enshrined in the DPP’s charter. By rejecting the KMT the people have rejected its logic of one China policy as well.³

The pro-independence shift has taken strong and deep roots in Taiwan’s civil society particularly after the successful Sunflower students movement in 2014 during which students and activists occupied the Legislative Yuan against the KMT government’s trade pact policies for PRC. However, China will be keeping a close watch over the actions and intentions of the new government. Immediately after election of Ms Tsai as the new President, the social media in China was hyper active in conveying to Taiwanese people the popular mood in mainland China against independence. Beijing has made it clear that any proclamation of independence by Taiwan will invite stern Chinese action that doesn’t exclude invasion of Taiwan. Adverse relations with China could also mean invoking economic sanctions and Beijing luring nations that have diplomatic ties with Taiwan away from it.

President Tsai will also be besieged with domestic issues like weak economic growth and an unequal distribution of wealth that she mentioned in the election campaigns. The economy is not doing very well. The GDP growth rate for 2016 is pegged at 2.32 per cent⁴. Taiwan today has 40 per cent of its trade with its largest trading partner, China. The new government will have to focus on diversifying its trade relations and competitiveness to avoid over-dependence on Chinese economic growth. Taiwan has the world’s lowest fertility rate⁵ and is also an aged society putting huge pressure on its robust Social Security System. It has to focus on development of human resources to compensate for limited natural resources. The reforms in Parliament (Taiwanese believe the legislators do not contribute as much as they are paid!!) and meeting the aspirations of youth are other tasks clearly culled out for the new government.

Taiwan today is a developed nation with a large technological base. It is a global and regional hub for trade in Information, Communication and Technology (ICT) fields, manufacturing electronics under international brands like HTC, ACER, ASUS and others. However the future is quite uncertain due to effect of global issues like decreasing oil prices, low population growth causing shortage of skilled manpower and a hegemonic China. The downturn in Chinese economy and China’s focus on developing indigenous supply lines is a cause of concern in Taiwan. To overcome the crisis President Tsai can give impetuous to Taiwan’s move from ‘Go West’ to ‘Go South’ mode in its trade and investment policy.

Maintenance of harmonious relations with other important countries of the region will also be the President’s important concern. Though USA is committed to one China policy, the 1979 Taiwan Relations Act provides legal basis for the unofficial relationship between the United States and Taiwan, and enshrines the US commitment to assist Taiwan in maintaining its defensive capability. The United States insists on the peaceful resolution of cross-strait differences, opposes unilateral changes to the status quo by either side, and encourages dialogue to help advance such an outcome⁶. Many Taiwanese look at this arrangement as US way of maintaining a first line of defence against communist China’s advance eastwards. Taiwan’s good relations with Japan, Korea, ASEAN and other Asian countries are also important for advancing its national agenda and regional security.

Under the ‘Go South’ mode the new government is expected to engage India more intensely. Though India too recognizes one China policy, its economic and cultural relations with Taiwan have grown steadily after 1995 when the representative offices in Delhi and Taipei were set up. Both sides are making efforts to find ways to promote ties further within the geo-political constraints of the region. The bilateral trade has increased from US $ 1.2 billion in 2000 to US $ 5.9 billion in 2014⁷. India today generates similar levels of excitement among exporters in Taiwan as mainland China did in last few decades. Companies are drawn by a population of 1.25 billion that has been primed for consumption by steady economic growth⁸. The expansion of its middle class, which has reached 300 million people, translates into huge demand for products⁹. India is also aggressively marketing its quest for FDI under the ‘Digital India’, ‘Make in India’ and ‘Skill India’ campaigns of Prime Minister Narendra Modi. Taiwan has the one of the largest reserve of foreign exchange in the world today at USD 426 billion¹⁰ that can be tapped by India.

India could also help in providing youth power to Taiwan whose population is fast aging. Indian students can be encouraged to study in Taiwanese universities that number more than 160 but have diminishing enrolments. Tourism, agriculture, fisheries, food processing, science and technology and infrastructure developments are other areas where bilateral cooperation has high scope. A strong relationship will help in maintaining peace and stability in the Indo-Pacific region. More people to people contact and will to address the geo-political constraints like one China policy will further the ties between the two sovereign nations. However Taiwanese businessmen will look forward to improved infrastructure and governance to increase their footsteps in India.

The period of President Ma’s Presidency was expected to be a golden decade but the opportunity was lost due to his policies on cross strait relations, weak economic growth, rise in petrol and electricity prices, philosophy on old age pension reforms and the Sunflower movement. The victory of Ms Tsai Ing-wen is being looked up as support for change and a new Hope for the Taiwanese people! The task will be challenging.

Endnotes:

1 Taiwan Review, January 2016
2 Pat Gao in Taiwan Review January 2016
3 Teipei Times, 26 January 2016
4 National Statistics, ROC
5 2015 World Population Data Sheet
6 US Department of State website, chapter on Relations with Taiwan
7 New Roads to India, Taiwan Review, February 2016
8 Taiwan Review, February 2016
9 Tien Chung-kwang, head of the Teipei Economic and Cultural center in India, Taiwan Review, February 2016
10 Central Bank of (ROC) Taiwan, release date 05 Feb 2016

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Published Date: 15^th February 2016, Image Source: http://www.economist.com
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of the Vivekananda International Foundation)