Is the Cross-Strait Relations Trio in Harmony?
Photo Credit: Reuters
By Dongtao Qi

Is the Cross-Strait Relations Trio in Harmony?

Jan. 30, 2018  |     |  0 comments

The advent of the New Year witnessed continued political confrontations between mainland China and Taiwan which have been reported and discussed widely. But observers of cross-strait relations should be reminded that political relations are only one “melody “of the cross-strait relations trio. If our attention and thinking are too occupied with politics, we will miss economic and social relations — the other two important cross-strait relations — and our assessment and predictions of cross-strait relations will be unbalanced and often go wrong.


In general, the cross-strait relations trio since Tsai Ing-wen took office shows increasing political confrontation on one hand, and steady economic and improving social relations on the other. In other words, the three cross-strait relations have developed into largely separate “melodies”/fields which follow different dynamics.


The cross-strait political confrontation originated in Beijing’s and Taipei’s divergent views on the so-called 1992 Consensus, or more essentially, the one-China principle proposed by Beijing and then accepted with a different interpretation by the former Ma Ying-jeou administration during 2008-16. Based on the constantly improving and unprecedentedly good cross-strait political relations under the Ma administration, the Chinese government has insisted that the 1992 Consensus be the fundamental political pre-condition for good cross-strait political relations, and therefore, also the most important part of the cross-strait status quo.


From Beijing’s perspective, because Tsai does not follow Ma in openly accepting the 1992 Consensus, she has broken the cross-strait status quo. To push Tsai to accept the Consensus, the Chinese government has cut off all official ties with the Tsai administration and those local governments led by DPP members. Nevertheless, Tsai has insisted that good cross-strait relations should be maintained without any pre-conditions and that Beijing should be blamed for first breaking the cross-strait status quo.


Tsai has promised repeatedly that her administration would take non-provocative but principled stands on cross-strait issues. But Beijing interprets her administration and the DPP legislators’ series of moves as open or hidden challenges to China’s pro-unification efforts, and labels them desinicization or “soft pro-independence endeavours.” Therefore, Beijing’s increasing pressure on the Tsai administration may also be viewed as retaliation against these challenges.


For example, in December 2016 and not long after Tsai gave a telephone call to Donald Trump, São Tomé and Príncipe, one of the 22 countries having official diplomatic ties with Taiwan, switched its diplomatic allegiance to China. In March 2017, Taiwan arrested a former mainland Chinese student Zhou Hongxu for espionage and about 10 days later mainland China held a former DPP worker Lee Ming-che for subversion. Zhou was sentenced to one year and two months’ jail in September in Taiwan and Lee five years’ jail in November in mainland China.


However, Beijing is unable to prevent the Tsai administration and the DPP legislators from promoting desinicization domestically in various fields such as history and language education. What Beijing can do, is doing, and will continue to do is to increase pressure on Tsai with politically sensitive actions such as the “island encirclement patrol” gradually routinized by the Chinese air force. Tsai will not openly accept the 1992 Consensus and the two sides will continue with their unilateral actions based on their declining trust of each other. Trust-building needs positive, especially direct, interactions, but current indirect and negative interactions are most likely to continue in 2018.


Cross-strait political confrontation has reinforced both Beijing’s and Taipei’s determination for making use of economic policies to serve their contrasting political goals: cross-strait integration for Beijing but separation for Taipei. Since 2016, the Chinese central and local governments have been further improving policies to attract more Taiwanese capital and people, especially young Taiwanese, to mainland China. In contrast, the Tsai administration has been promoting the “New Southbound Policy” to reduce Taiwan’s economic dependence on mainland China. Nevertheless, cross-strait economic relations have been following a long-term trajectory that is not substantially influenced by either cross-strait political relations or Beijing’s or Taipei’s economic policies. 

Since Tsai took office in 2016, the cross-strait relations trio has not been playing harmonious music. Disturbing political confrontations have mingled with steady economic relations and improving public views toward each other.

For example, according to the Chinese government’s statistics, Taiwanese investment in mainland China as a percentage of total foreign direct investment (FDI) has been declining constantly since 2006. Good cross-strait political relations during 2008-15 and the Chinese government’s effort to solicit more Taiwanese capital since 2016 could not reverse this declining trend. During the January-September 2017 period, while total FDI in China dropped by 3.2 percent year-on-year, Taiwanese investment plunged by 9 percent, much larger than the overall FDI decline. In 2017, the negative growth of cross-strait trade in 2016 turned positive; however, as a percentage of China’s total trade during January-September, it did not increase year-on-year. Therefore, investment and trade statistics show that cross-strait economic integration has basically been slowing down.


However, the slowdown of cross-strait economic integration does not necessarily mean the success of the Tsai administration’s New Southbound Policy. For example, according to the Taiwanese government’s statistics, while Taiwanese investment in mainland China decreased by almost 8 percent in 2017, in other countries it decreased by 16.8 percent, more than double that for mainland China, reflecting a failure on the part of the Tsai administration in diverting Taiwanese capital from mainland China to other countries. The Tsai administration was not able to divert more trade from mainland China to other countries either. Cross-strait trade as a percentage of Taiwan’s total trade has been rising since 2015. In the first nine months of 2017, cross-strait trade was 23.6%, slightly higher than 2016’s 23.1%.


In the tourism industry, average monthly mainland Chinese tourists to Taiwan were in constant decline, from 349,000 per month in 2015 to 226,000 in 2017. Correspondingly, mainland Chinese tourists as a percentage of total tourists to Taiwan have dipped from 40 percent in 2015 to 26 percent in 2017. In contrast, average monthly Taiwanese tourists to mainland China during the January-November 2017 period numbered 238,000, up by 6.7 percent year-on-year.


The last “melody” of the cross-strait relations trio is social relations. Interestingly, public views in mainland China and Taiwan became much less hostile towards each other in 2017. A series of annual public surveys conducted by a major Taiwanese newspaper, United Daily News, showed that the Taiwanese public’s favorable impression of the Chinese government has been on a constant incline since 2014 and significantly rose to 2017’s 40 percent from 2016’s 31 percent. A similar trend is evident in their impression of ordinary mainland Chinese people; it has been constantly improving to reach 2017’s 49 percent from 2014’s 36 percent. For the first time since the survey started in 2010, the Taiwanese public’s favorable impression of mainland Chinese people (49 percent) had surpassed their unfavorable impression (37 percent).


Taiwan’s improving public view towards mainland China corresponds with declining Taiwanese nationalism as indicated by a dip in people who self-identify as Taiwanese. The surveys by the National Cheng-chi University show that Taiwanese identity has been declining since its peak in 2014, dipping to 55.3 percent in 2017 from 2014’s 60.2 percent.


In mainland China, radical voices calling for the takeover of Taiwan by military force gradually subsided in 2017, especially after the CCP’s 19th Party Congress. The party congress continued to emphasise peaceful rather than non-peaceful reunification as China’s grand strategy towards Taiwan. It seems the Chinese government has successfully quelled radical online voices against Taiwan in China.


In summary, since Tsai took office in 2016, the cross-strait relations trio has not been playing harmonious music. Disturbing political confrontations have mingled with steady economic relations and improving public views toward each other. While the trio’s political performers have dominated the stage and received the most attention, we do hope that the economic and social performers will play harder and louder not only to get more media coverage, but also to help harmonize the trio by positively influencing the political performers.

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