Protesters in Taiwan are angry. They’ve taken over the island’s Parliament, blocking the doors with piles of furniture. They also stormed the offices of the Cabinet, where they clashed with riot police armed with batons and water cannons.
The source for all this hostility? A proposed trade deal with mainland China that would open up more than 100 service sectors, ranging from banks and telecommunications to travel agencies and hospitals.
But like the protests in Ukraine a few months back, the discontent in Taiwan is about much more than Chinese investors setting up travel agencies on the island. It’s about Taiwan’s future and how it preserves its identity — and its relevance — in the shadow of China and its growing economic, political and military clout. Many see it as a battle for Taiwan’s economic and political survival.
“The Taiwanese are having a kind of anxiety,” acknowledged Lung Ying-tai, Taiwan’s first minister of culture, during a meeting earlier this month with a group of U.S. journalists.
“Everybody gets very edgy [about China’s economic strength],” she said. “But the Taiwanese are even edgier than other people, [who] don’t have missiles stationed right across the strait.”
Losing Its Economic Edge
The two sides split in 1949 during the Chinese civil war. Beijing considers Taiwan a breakaway province and remains committed to the goal of eventual reunification — and hasn’t ruled out the use of force to do so.
When I lived in the capital Taipei a decade ago, anxiety about China was already palpable. But then, Taiwan — one of the Asian Tigers — was thriving economically, boasting vigorous growth and leading-edge high-tech companies that made semiconductors, personal computers and notebooks.
Taiwan had a confidence that belied its size.
It was back then that construction began on Taipei 101 — a soaring skyscraper in the Taiwanese capital’s fashionable Hsinyi district. For six years, Taipei 101 was the world’s tallest building — until Dubai’s Burj Khalifa usurped the title in 2010.
In the past, too, it seems, is the island’s economic heyday. On a recent Friday night, I wandered around the glitzy, sprawling shopping mall at the base of Taipei 101 with a couple of my aunties. It’s filled with luxury brands like Gucci, Louis Vuitton and Prada, and stylish cafes and restaurants. On a Friday, I thought it would be hopping.
I was wrong.
Bu jingqi — the economy’s depressed — my aunties told me gravely, as I remarked on how eerily deserted the mall was.
Now, the IT industry that fueled Taiwan’s growth is facing challenges, as PCs and notebooks have given way to smartphones and tablets. And for low-cost manufacturers, wages, land and energy are much cheaper across the Taiwan Strait in China.
Godwin Wang, an assistant vice president at the Farglory Free Trade Zone just outside Taipei, put it more bluntly: “We are suffocating because [China] is stealing our jobs.”
And Taiwan’s confidence has taken a beating.
Unfulfilled Cross-Strait Hopes
When Ma Ying-jeou was elected president in 2008, he hoped to regain some of that economic might by making closer ties to China a priority. For his party, the Kuomintang, or KMT, an improved relationship was the key to kick-starting the island’s economy.
But so far, that key has not ignited the engines of growth, despite a doubling of cross-strait trade since 2008, the establishment of direct flights, opening up of the tourism sector and a historic meeting of officials from the two sides earlier this year.
“Taiwan’s economy has been stagnant for a decade,” says Amy Chang, senior director of government and public affairs at the American Chamber of Commerce in Taipei. “It used to grow 7 percent; now it’s only 2 to 3 percent at best. And the talents are draining because people are hiring from Taiwan, going to Southeast Asia, going to China.”
Protesters say the controversial trade pact further undermines Taiwan’s economy. They say the island’s small companies will suffer as a result, and worry more broadly that Taiwan’s economic well-being will become ever more reliant on mainland China.
Taiwan’s economy is heavily dependent on exports, 40 percent of which go to China. Many observers say the best way for Taiwan to bolster its economic independence is to join regional trade groups like the Trans-Pacific Partnership or to seek more bilateral free-trade agreements like recent deals with New Zealand and Singapore.
Is Democracy Enough?
The political piece is harder to solve.
Students protesting the trade pact are also angry at what they see as a threat to the island’s hard-won democracy: They say the ruling KMT completely steamrolled the political system, by reneging on a promise to allow a thorough review and debate of the terms of the deal, and sending it straight to the KMT-controlled Parliament for a vote.
Taiwan takes its democracy seriously, even though its freewheeling and often turbulent political system is relatively young, emerging from a postwar military dictatorship only in the 1980s and ’90s.
And it’s become a tourist attraction, too, said Chu-Chia Steve Lin, deputy minister of the Mainland Affairs Council.
After visiting Taiwan’s famed night markets, mainland tourists rush back to their hotels.
“We have lots of political TV talk shows after 9 o’clock,” Lin said. “The [mainland tourists] really enjoy how people can criticize their government.”
I heard this story from Taiwanese officials and ordinary people alike. The message is clear: Mainland Chinese marvel at Taiwan’s democratic system. It’s a narrative that Taiwan needs.
When it comes to reunification versus independence, hardly any Taiwanese support the former. And as the population ages, and more and more native-born Taiwanese come of age, that number will dwindle further.
For the past 20 years, most have supported maintaining some version of the status quo; they just fear further Chinese encroachment and control.
But what does the future look like? It will take some reimagining.
“It was a bloody civil war and then 60 years of separation,” Lung Ying-tai, the culture minister, said about cross-strait relations. “And so you have a lot of preconceptions about people on the other side. It takes time … to have the ability to see the other person … to see your used-to-be enemy the way they really are. It’s not an easy task.”
And time, it seems, is on China’s side.