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Key Economic Data 
  2003 2002 2001 Ranking(2002)
Millions of US $  406,000    
GNI per capita
 US $ 18,000
Ranking is given out of 208 nations - (data from the World Bank)

Books on Taiwan

Update No: 111 - (26/10/13)

Is Taiwan burning?
While Taiwan’s export-oriented economy continues to languish in the doldrums, President Ma Ying-jeou appears to be single-mindedly focused on building a legacy for his presidency defined in terms of the cross-straits issue and building the relationship with China, rather than in giving support to his domestic constituents. With a popularity rating that last month plummeted to single digits and the Asian Development Bank now blaming poor governance for the root cause of Taiwan’s economic backtracking, some observers believe that Ma has taken a leaf from the Roman Emperor Nero and is (metaphorically) fiddling while Taiwan is burning.

This year Taiwan’s ‘Double-10) National Day commemoration was hardly a celebration, with the public banned from the main event and a heavy police presence intended to discourage all but the most diehard activists. Ma’s speech to the nation appeared to give more encouragement to those on the Chinese mainland urging unification than to the nation that elected him to govern.

The latest update to Asian Development Outlook 21013, issued by the Asian Development Bank has put Taiwan last among the four Asian tiger economies and has cut the economic growth forecast for this year from 3.5 per cent to 2.3 per cent. This is slightly more pessimistic than the official forecast of 2.31 per cent issued by the government’s own Directorate General of Budget, Accounting and Statistics (DGBAS): While acknowledging that a poor external environment had to shoulder some of the blame — particularly for Taiwan’s sagging export performance, the ADB report clearly stated that poor governance was the root cause of the problem. Yet, the government, and in particular President Ma Yiing-jeou continues to ignore such concern and has his legacy firmly fixed (some would say ‘fixated’) on cementing the ‘one-China’ principle. Does he have designs for a role on a bigger stage?

Last month we reported on the political standoff between veteran legislator and Legislative Speaker, Wang Jin-pyng and President Ma. Wang and Ma represent rival factions within the ruling KMT party and the feud between these two men was widely interpreted as further evidence that Ma would brook no internal opposition in his efforts to enforce his policies on the Party and, indeed, on the country. Ma wanted the popular Wang removed from his post, expelled from the party and — as a ‘legislator at large’ (meaning elected on the basis of proportional representation rather than a single-seat constituency — removed from the legislature where, at 73 years of age, he was expected to slide into oblivion.

But Wang refused to kow-tow and elected to take the battle over his removal to the courts rather than to the party disciplinary committee. The battle between the two men continues to be played out in the public arena with claims that, while President Ma holds himself up as a defender of the Constitution, the allegation against Wang — trivial though it is — was on the basis of evidence gained by the Prosecutor-General through illegal wire tapping. Once again the impartiality of the Taiwanese justice system has been called into question with claims, not without foundation, that the courts — and in particular, the office of the prosecutor — are once again serving the interests of the president and the ruling party and that in such an environment, judicial actions often bow to political expediency.

The feud remains unresolved but it seems differences were set aside, at least temporarily, for the celebration of the ‘Double-10’, Taiwan’s National Day that commemorates the start of the Wuchang Uprising of October 10, 1911 — an event that led to the collapse of the Qing Dynasty in China and the establishment of the Republic of China on January 1, 1912. The Kuomintang (KMT) as a party dates its origins from that time. Both Wang and Ma shared the podium for the flag-raising ceremony though this year, and breaking with tradition, the general public were not invited. Instead there was a heavy police presence all around the presidential palace no doubt designed to stop any demonstrators that might be encouraged to protest. There was certainly plenty to protest about.

Indeed in marked contrast to the festivities that usually mark the commemoration, this year’s event appears to have been a rather sombre affair. There was no given reason by the presidential office for cancelling the public ceremony but the reasons are not hard to fathom. The Ma administration remains besieged on a number of fronts with growing public anger over a number of his policies and his high-handed method of governance. In addition to public anger over the witch hunt against Speaker Wang, demonstrators have been active in recent weeks protesting such issues as the construction of the 4th nuclear power plant, land seizures and the forced demolition of homes; and, of course, suspicion over the cross-straits trade services pact and the fear in many quarters that yet another cross-straits agreement will be rammed through by the KMT-controlled legislature without proper scrutiny and thereby binding Taiwan’s future ever closer to that of China.

Those that listened to Ma’s National Day speech were not assuaged by his words. In his address, Ma ignored the protests and the political instability and concentrated instead on what he saw as the achievements of his presidency. He touted his efforts at economic liberalisation and the creation of an open and prosperous economic environment and projected himself as the leader bringing Taiwan to an ever more prosperous future. Fortunately, the Asian Economic Update was issued by ADB after his speech.

But it was in his handling of relations with China, that his words rang alarm bells in that it appeared to many observers that he was taking a further step closer towards the Beijing position on the form of the cross-straits relationship and the demand by China’s leaders to begin a dialogue on political issues. In his speech he abandoned his former ‘three noes’ policy (no unification, no independence and no use of force) and described cross-straits ties as being non-state-to-state relations that had to be considered in the context of ‘one China’:

“The people on both sides of the Taiwan Strait are all Chinese by ethnicity. Cross-strait relations are not international relations... Each side acknowledges the existence of ‘one China,’ but maintains its own interpretation based on the ‘1992 consensus,’

Although a KMT spokesperson downplayed the shift in wording, many observers of the local political scene believe his statement further weakened Taiwan’s sovereignty and was a hint directed at both Japan and the United States that cross-straits issues were none of their business. Effectively, he made the issue a Chinese internal one, thereby denying any other country the opportunity to intervene in the event of any military conflict or threat of one.

Once again it seems that Ma has sought to deflect local concern over the direction of his domestic policies by refocusing on China. The smart money suggests that it was meant to pave the way for a meeting between him and China’s President Xi Jinping, perhaps at next year’s APEC meeting.

This idea appears to have been reinforced by the meeting at the recent APEC summit in Bali, Indonesia between Ma’s envoy to the summit, former vice president Vincent Siew and Chinese President Xi. It appeared that Xi was putting pressure on Taiwan to begin political talks when he emphasised that the problems caused by long-term political disagreements between the two sides must be resolved and could not be left to future generations. The implication in those remarks was clear.

Pundits are expecting an interim political agreement between Taipei and Beijing before the APEC meeting next year, a development that could enable Xi to attend the next summit as the leader of ‘one China’ with its Taiwan protectorate of ‘Chinese Taipei’ represented by Ma. Once that happens, it will be game over. Meanwhile President Ma continues to fiddle, apparently oblivious to the fires he has started.

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