By Angela Luh
For the first time since the end of the civil war in 1949, China and Taiwan held direct talks this February in what seemed a sure indication of improved relations between the two long-time rivals. While few countries formally recognize Taiwan as an autonomous state, Taiwan has the unique position of having its own government and a democratic electoral system. These vast institutional and cultural differences have created long-term divisions in Taiwan’s domestic politics along what could be generalized as pro-China and anti-China lines. In light of their political tensions, the February meeting was a significant milestone for Cross-Strait relations. For China, the meeting demonstrated Taiwan’s willingness to cooperate in increased interregional trade. For Taiwan, it was a gesture of China’s recognition of its sovereignty.
Hardly a month later, things quickly turned south.
Many factors coalesced to spark the Sunflower Student Movement, one of the largest and longest protests in Taiwan’s history. As part of the Economic Cooperation Framework Agreement (ECFA) signed between China and Taiwan in 2010, the Cross-Strait Service Trade Agreement (CSSTA) opened Taiwanese services to Chinese investment, affecting domestic sectors like telecommunications, financial services, tourism and travel. Opposition in Taiwan toward the CSSTA was predictable. As with all free trade agreements (FTA) in which one economy is far more dominant than the other, Taiwanese dissenters feared that Chinese investment would leave Taiwan disproportionately dependent on the Chinese economy. FTAs typically benefit large firms and corporations while effacing small and medium-sized enterprises (SME), and thus, it was expected that opposition would be carried out by Taiwan’s sizable SME sector as well as other businesses that stood to lose from the FTA.
What wasn’t expected was the extraordinary scale of the protest.
On March 18, over 100,000 protesters across Taiwan, many of whom were students and graduates from Taiwan’s most prestigious universities, bypassed security forces to occupy the Legislative Yuan (parliament), effectively halting all government functions. The protest, termed the Sunflower Student Movement, began in part over the Kuomingtang (KMT) government’s attempt to pass the CSSTA on March 17 without a clause-by-clause review by the opposing Democratic Progressive Party (DPP). Opponents criticized the government for circumventing a democratic review of the agreement and for the lack of transparency in the legislature over the issue. Many others viewed further economic integration with China as a capitalist assault on Taiwan’s vulnerable domestic companies. But as the movement escalated and gained momentum throughout Taiwan and even worldwide, the protest shifted its focus to a far more resonant and contentious point: the fate of Taiwan’s independence in the hands of a rising China.
China’s rapid economic expansion and its aggressive stance in the East and South China Seas have left many of its neighbors nervous–but none more so than Taiwan. While China maintains that Taiwan is a breakaway province, the international community widely views it as an independent state. Taiwan has a grand international presence; currently, it has informal relations with 57 countries. Domestically, many Taiwanese, particularly those of the younger generation, are resolute in distancing themselves from Chinese culture and politics, arguably in an attempt to bring clarity and validity to Taiwan’s ambiguous international status. The desire for Taiwan’s continued de facto independence is common ground for Taiwanese civilians, even across party lines. Framing the protest as a defense of Taiwan’s autonomy was critical in mobilizing massive public support for the Sunflower Movement.
On a global scale, the support was also slanted in favor of the Taiwanese student protesters. Aside from viewing the parliamentary process as a breach of democracy and denouncing the government’s subsequent forceful restraint of protesters, observing countries fear a change in the status quo of East Asia. Some see Taiwan as a democratic beacon amid a region that is gradually becoming inextricably dependent on communist China. From a strategic standpoint, however, Taiwan is an entry-point for countries like the United States to insert their foreign policy and economic interests. Moreover, Taiwan’s “independence” is crucial in subduing what scholars have termed China’s “new assertiveness.”
The extreme lengths of the protest and the marred reputation of the Taiwanese government have suspended Cross-Strait dialogue on political issues for the time being. In straddling the fine line of interdependence, Taiwan recognizes the urgency of a boost to their floundering economy but also keenly resists over-reliance on China, which could leave Taiwan vulnerable to unification. Taiwanese business owners and government officials, who make up the majority of the pro-CSSTA constituency, have argued for stimulus through increased Chinese investment, but the dominant Taiwanese audience has decided that the cost of losing domestic sectors to Chinese infiltration outweigh the benefit of higher-valued industries.
Although the protest accomplished what it sought to do, Taiwan faces a number of political and economic challenges in its near future. Its economy is heavily export-oriented and trade-dependent, led by a high-tech sector that faces competition from advanced economies like Japan, the United States, South Korea, and increasingly from China. Its reliance on trade signals that Taiwan will inevitably need to secure an FTA with China. In addition, Taiwan needs as much foreign investment as it could receive to reposition its industries. With countries like South Korea signing numerous FTAs in the past few years, demand for Taiwanese goods will decline, as about 60% of South Korean exports overlap with Taiwan’s.
In the short-term, it is imperative for Taiwan to elevate itself on the international stage. Its overall positive political image when compared to China’s–as seen last year when Taiwan pledged twice the foreign aid for Typhoon Haiyan that a vindictive China did–will work in its favor to garner international support in future Cross-Strait conflicts. Regionally, Taiwan should forge closer relations with South Korea and Japan to discourage them from entering in multilateral agreements with China. Should it be excluded from major trade blocs, Taiwan will risk losing its competitive advantage, not just in regards to China but with its trading partners around the world.
Photo by Jeffrey Cuvilier