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Asia Insight

China and US square off in Taiwan's presidential race

Feted in Washington, Tsai faces threat from Beijing -- and within her own party

TAIPEI -- With a presidential election less than nine months away, Taiwan's two major parties have already clearly positioned themselves.

In one corner, the ruling Democratic Progressive Party, which controls both the executive and legislative branches, presents itself as the defender of Taiwan's young and hard-earned democracy. The DPP is represented by President Tsai Ing-wen, who in her three years in office has brought the party, and Taiwan, closer than they have been to Washington since Jimmy Carter ended official U.S.-Taiwan ties 40 years ago this month.

In the other corner is the opposition Kuomintang, the party that lost China to Mao Zedong's communist forces and fled to Taiwan in 1949. Once staunchly supported by the U.S. during the Cold War, it monopolized political power on the island until the arrival of democracy in the 1990s, after which it has become increasingly close with its erstwhile enemy across the Taiwan Strait, the Chinese Communist Party.

Under Tsai, the economy has performed better than it did toward the end of the term of her KMT predecessor, Ma Ying-jeou. She has focused on diversifying away from a reliance on China, Taiwan's largest trading partner, and the International Monetary Fund expects Taiwan to grow by 2.5% in both 2019 and 2020, even taking into account the U.S.-China trade war. Nevertheless, a large number of Taiwanese feel the economy has worsened on her watch, a view propagated by most KMT- or China-leaning local media.

Since 2016, China has attempted to punish Tsai by reducing tour groups to Taiwan, but inbound tourists to the island have steadily set records, surpassing 11 million for the first time last year. Despite the boom -- and the fact that Chinese tour groups typically contribute little to local economies on a per capita basis -- many Taiwanese voters who boosted the down-and-out KMT in local elections last year were convinced the absence of the groups was hurting the economy.

As in any democracy, local issues will determine the outcome of Taiwan's presidential and legislative elections in January. Should more voters feel threatened by an increasingly aggressive China when they go to the polls, the DPP and its strong ties with Washington will benefit. If economic concerns are primary for Taiwan's electorate, however, the pro-China KMT -- and China's seven-decade quest to annex Taiwan -- are likely to be the big winners.

It wasn't always like this. The U.S. and KMT were close for most of the past 70 years. Just eight years ago, Washington was still going to bat for the party. In 2011, an unnamed Obama administration official told Financial Times reporters that the White House was concerned that a victory by Tsai, who was making her first bid for the presidency, would disrupt U.S.-China relations. The report came out just as Tsai was visiting Washington to be vetted by U.S. officials, now a customary ritual for Taiwanese presidential aspirants.

The leak caught her flat-footed and may have influenced the outcome of the 2012 election, which was won by the KMT incumbent, Ma. Many Taiwanese, with good reason, view the move by the Obama administration as American meddling in their election in favor of the KMT.

Taiwanese President Tsai Ing-wen speaks at a banquet during a visit to Los Angeles in August 2018.   © Reuters

This time, meddling concerns are focused on Chinese efforts to assist a resurgent KMT in its quest to retake power. If successful, a drastic departure from Tsai's insistence on unconditional bilateral talks with Beijing would be likely. The two most popular declared candidates, former New Taipei City Mayor Eric Chu and billionaire Terry Gou -- as well as the most popular but still-undeclared candidate, Kaohsiung Mayor Han Kuo-yu -- are all likely to endorse the position that Taiwan is part of China, Beijing's prerequisite for bilateral negotiations.

Where things go from there would be up in the air. Should he choose to run, Han, a darling of Taiwan's KMT-leaning media, would likely win the primary in June, and quite possibly January's presidential election. This prospect would undoubtedly please Beijing.

In March, during a visit to four Chinese cities, Han met with local officials in a mayoral capacity. Yet he also had closed-door meetings with the directors of the liaison offices in Hong Kong and Macao, the two former colonies that are now ruled under the "one country, two systems" framework that Chinese President Xi Jinping is dangling before Taiwan as a post-unification arrangement.

Kaohsiung Mayor Han Kuo-yu, should he choose to run for president, would have a good chance of winning -- a prospect that would almost certainly please Beijing.   © Reuters

During a stop in Xiamen, Han also met with Liu Jieyi, director of the Taiwan Affairs Office, a cabinet-level body that sets China's Taiwan policy. A self-styled "vegetable seller," Han was in China ostensibly to sell food products from Kaohsiung, but critics accused him of attempting to sell his country to China -- a charge he denied upon his return.

Han's meetings with the Liaison Office directors and the TAO chairman are not problematic by themselves, said Kharis Templeman, program manager at Stanford University's Taiwan Democracy & Security Project.

"In general it is helpful for U.S. interests when the two sides are talking to each other," Templeman told the Nikkei Asian Review, referring to the KMT and the Chinese Communist Party.

"But it is also clear that Beijing really favors Han and wants him to succeed, and the exceptional access they granted Han during his visit, in contrast to the complete freeze in communication they have imposed on the Tsai administration, suggests they won't be shy about indicating that support and trying to leverage their influence in Taiwan's domestic politics."

"That creates a danger for Han with American but more importantly Taiwanese audiences," Templeman said. "If he is nominated by the KMT, he needs to dispel impressions that he would be a tool for Beijing."

Otherwise, Templeman added, there will be significant concerns in the U.S. about what a Han presidency might mean for American interests, particularly now that skepticism of China's intentions is so widespread in Washington.

Gou, the billionaire boss of electronics giant Foxconn, formerly known as Hon Hai Precision Industry, has made the bulk of his fortune off his China-based operations. While claiming to be a citizen of no country, his extensive investments in China are considered by many Taiwanese to be a national security risk if he becomes president.

Chu, the former New Taipei mayor, who lost convincingly to Tsai in the 2016 presidential election, has come across as potentially the most pro-China candidate so far. In the face of growing calls from KMT members for the party to draft Han into the primary, Chu announced that, if elected, he would invite Xi to visit the Taiwanese-controlled Kinmen Islands and sign an "eternal peace agreement." Chu has not said what he would be willing to offer Xi in exchange for an end to threats of invasion.

A memorial ceremony in Kinmen, marking the 60th anniversary of the Second Taiwan Strait Crisis last August: KMT candidate Eric Chu wants to invite Chinese leader Xi Jinping to Kinmen to sign an "eternal peace" pact.    © Reuters

Back on the DPP side, Tsai has been basking in the glow of bipartisan American adulation in recent weeks. In Washington, she is the most-feted Taiwanese president since democratization. This is her greatest strength, as well as her greatest weakness. Even though they live in a geostrategic flashpoint, most Taiwanese are not focused on foreign policy.

Tsai's popularity is flagging. Many think she has been spending too much time on diplomacy and making her case for greater international support for Taiwan, compared with local issues. That said, Taiwan's president traditionally focuses on foreign policy, leaving the premier to deal with day-to-day domestic issues.

The previous premier under Tsai, William Lai, has stepped up to challenge Tsai in a primary that will be decided in late May, saying that he is concerned the DPP could lose the presidency and important legislative seats in January.

Nathan Batto, a researcher at Academia Sinica who focuses on Taiwan's elections, said the stakes are high for Tsai.

"Lai's entry into the race seems to have caught President Tsai and her inner circle off guard," Batto told the Nikkei Asian Review. "Polls consistently show him starting the primary process with a healthy lead over her."

Tsai, he said, "is in a fight to save her presidency, as she faces the very real possibility of becoming a lame duck a full nine months before the election and thirteen months before her term ends."

Nikkei staff writer Lauly Li contributed to this article

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