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TAIWAN


 

 

In-depth Business Intelligence

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

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REPUBLICAN REFERENCE

Area (sq.km) 
35,980 

Population 
22,603,001

Capital 
Taipei

Currency 
New Taiwan dollar (TWD)

President 
Chen shui-bian




Update No: 024 - (01/01/06)

Taiwan's 13 million voters went to the polls on Saturday December 3 to elect local government officials. Taiwan's ruling Democratic Progressive Party (DPP) fared poorly winning only 6 of the 23 mayoral and county magistrate seats. Previously it held 10 such posts and had counted on picking up at least one extra position this time around. The Kuomintang Party won 14 seats while its ally, the People First Party won one seat. Smaller marginal parties picked up the remaining two seats.
A measure of the magnitude of the defeat can be seen in the fact that the DPP lost control of Taipei County which it had held for the past 16 years. It also lost control of the counties of Ilan and Chiayi which traditionally had been DPP strongholds.
The result was a slap in the face for President Chen Shui-bian who, having barely scraped into the Presidency last year had hoped to swing voters back to the DPP camp. However, the result shows that the president and his party have lost much of the middle ground support they previously enjoyed.
The DPP won the presidential elections of 2000 and 2004 in part because the KMT had become complacent after 50 years in power (much of it as the sole political party under a regime of martial law) and was seen as both corrupt and unresponsive. Its then leader, Lien Chan was a party apparatchik who was a competent (if somewhat patrician) general manager of KMT Inc. but who showed little charisma as a "political" willing to stump the hustings.
But over recent years, the KMT has shown signs of reforming itself. Nowhere more so than in the election of popular Taipei City Mayor Ma Ying-jeou as party chairman back in August in the first ever direct election of chairman in the party's history. Mr. Ma is an astute politician and while his election to the chairmanship was somewhat controversial within his own party, his stature has indeed been boosted by the recent vote which has shown that the KMT is by no means a spent force as the DPP has often tried to paint it.
As a jubilant Mr. Ma was quick to point out when the election result was called, the DPP can really only blame itself for its defeat. These recent months have been characterised by legislative gridlock, uncertainty over policy direction - especially with regard to the business and industrial sector - much of which has already moved to China and a recalcitrant attitude to dealing with Beijing which has marginalised Taiwan's role within the "greater China" realm.
Corruption scandals involving senior DPP officials from Kaohsiun which surfaced just prior to the December election also played a part in the defeat. These scandals related to irregularities in the tendering process for the Kaohsiung Mass Transit Railway. They occurred during Premier Frank Hsieh's watch as Mayor of Kaohsiung City and while he has not yet been linked to the scandal, many other senior DPP officials have and it may yet cost him his job when the Cabinet is reshuffled.
Since the election result, President Chen has been notably quiet and in the background - preferring to let others take the heat and especially DPP Chair Su Tseng-chang, who resigned and accepted responsibility. Yet the reality is that voters are dissatisfied with President Chen's performance. In the remaining two years of his presidency he will have to engineer a major turnaround in his party's policy stance or else hand victory to the KMT in the 2008 presidential election in which Mr. Ma is now, more than ever, looking like a sure winner for his party.
Yet Mr. Chen's freedom to manoeuvre is strictly circumscribed. He may seek to tone down the anti-China rhetoric and make a sincere effort to develop a modus vivendi with Beijing. But any such overture is more than likely to be rebuffed. China after all, can sense that the KMT is at last within grasp of regaining power as the ruling party and prefer to wait it out. 
Even before the election, divisions were surfacing within the DPP and it is moot to ask whether those divisions will result in further polarisation or whether an effort will be made to patch up differences and regain the middle ground. But it is difficult to see what the DPP can really do to get itself out of the corner into which it has painted itself with its myopic pro-Taiwan stand. The business community remains wary of the government and, by and large, sides with the KMT anyway. It makes little sense to do otherwise given the level of investment already in China and growing by the day.
Will Mr. Chen take the ultimate gamble and declare Taiwan's independence in the hope that China will not react ahead of the 2008 Olympic Games? It would be a foolish gamble indeed but Mr. Chen is no stranger to brinkmanship. It is doubtful however, that any such declaration would past muster with Taiwan's voters, most of whom still prefer to see the status quo maintained.
So while there is still some way to go prior to 2008 - and two rounds of elections even ahead of the next presidential poll (the mayoral elections of Taipei and Kaohsiung in 2006 as well as the legislative elections in 2007) - it is beginning to look like an election that the KMT can only lose by its own hand. With Mr. Ma at the helm he is likely to ensure that does not happen and there are even signs already that the breakaway PFP may be ready to at least consider a return to the fold.

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