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Indebta > Investing > Taiwan’s Economy Is What Matters to Voters, Not China
Investing

Taiwan’s Economy Is What Matters to Voters, Not China

News Room
Last updated: 2024/01/12 at 7:18 PM
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Nearly every day, Chinese fighter jets cross the median line separating the mainland from the island of Taiwan. Beijing has hundreds of missiles pointed at the capital, Taipei, that could reach the island in minutes.

Daily rhetoric from China calls Taiwan a rogue province that will be united with the mainland one day, by force if necessary. The verbal threats and a massive disinformation campaign have been underway for months leading up to Taiwan’s elections on Saturday.

Voters will choose between current Vice President Lai Ching-te, an independence-leaning liberal and Beijing’s most despised candidate, and two candidates who advocate for closer ties with China.

Nearly every recent credible poll suggests that Lai of the Democratic Progress Party (DPP) and his Taiwanese-American running mate, Hsiao Bi-khim, have a slim lead. The Taiwan Public Opinion Foundation, run by one of the country’s most respected polling groups, found the left-leaning Lai-Hsiao ticket 4.2% ahead of their closest competitor, the China-friendly Kuomintang (KMT).

The international media and foreign experts have been busy wringing their hands, as a conflict could ignite a bigger clash between the U.S. and China, the world’s two superpowers. The atmosphere couldn’t be more different walking the streets of Taiwan, talking to residents and gauging their fear of a China invasion.

“I’ve heard it for decades. Let them talk. I’ll live my life,” said Hsiao Shu-fen, who at a supermarket in Taipei told Barron’s she was a grandmother who remembers the days before Taiwan transitioned into a democracy. The country now scores among the highest civil liberties ratings in the world, according to Freedom House.

Hsiao has a point. Taiwan has lived as a sovereign entity for 73 years since the anti-communists fled to the island after losing China’s civil war. Every Communist Chinese leader since then has stated that they have a military plan ready for an invasion at the time of their choosing.

This is not to take lightly the threat felt by the Taiwanese people or the salient role the issue plays during election season. How each candidate would handle relations with China was brought up at every presidential and vice presidential debate last month, but it was alongside a raft of issues like clean energy, stagnant wages, affordable housing, and care for the aged.

KMT candidate Hou Yu-ih has cast this election as a choice between “war and peace”—a strategy that has seen him decline in the polls.

“I grew up with the threat of China,” said Lulu Chen, a 27-year-old graduate student who sat on a grassy hill in central Taipei amid unusually cool weather for the tropical island. “It’s a sort of background issue on the news, and other than that I just live my life as a Taiwanese just like you might in any other democratic country.” She called Hou’s strategy “fear-mongering” and said the DPP had her vote.

Attitudes like Chen’s can be heard across Taiwan, mainly among those under 40 who have known only a democratic system.

Western media tend to boil down Taiwanese elections as a China-only issue. But often, politics is just politics. Brian Hioe, a Taiwan affairs expert and editor of Taipei-based New Bloom Magazine, told Barron’s this election cycle isn’t as intensely discussed as preceding elections, even if it’s likely to be a tight race.

“The candidates are not considered terribly compelling, and there is no external framing issue along the lines of Hong Kong in the 2020 election cycle and Ukraine for the 2022 election cycle,” he said.

Favorability of the secondary tickets is nearly split. KMT head Hou, and Ko Wen-Je of the surprisingly competitive Taiwan People’s Party (TPP), are at about 28% and 25%, respectively. A competitive third party is rare in Taiwan.

And while the shadow of China is omnipresent during election season, voters are tired of it edging out room for discussion on other economic issues. Clean energy has been particularly contentious because green activists are torn between supporting clean but potentially hazardous nuclear power, and because 90% of the island’s traditional energy is imported and could be blockaded by China during a crisis.

“There is pushback against the incumbent DPP regarding its inability to resolve the economic issues that Taiwan faces,” New Bloom’s Hioe said.

“Compared to previous election cycles, voters are not as outraged about China currently, and this actually works against the DPP in many ways, since it cannot lean as strongly into the China frame for the present election,” he said.

China reportedly has tried to insert itself into the election, with a flood of disinformation from entities traced back to the mainland, according to cyber-security groups.

Beijing has long pushed the narrative that Washington would not come to Taiwan’s rescue in the event of war, so resisting unification is futile. China sent more than 1,700 warplanes into Taiwan’s so-called air defense identification zone—an area of airspace generally considered sovereign to a country—in 2023 and 2022, up nearly 80% from the preceding years.

More than a fear of China is a pride or duty many Taiwanese feel in upholding their hard-won democracy. Taiwan’s last autocrat, Chiang Ching-kuo, died in 1988, and the first direct and fair elections didn’t take place until 1996. Taiwan now has a vibrant democracy and rambunctious free media. Its last election, in 2020, saw a 75% turnout.

On Sunday, tens of thousands of Taiwanese gathered in the southern city of Kaohsiung for rallies for all three candidates. Citizens of all stripes were there to support their candidate.

Liu Pei-yu, a 32-year-old supporter of the incumbent “anti-China” DPP candidate Lai, expressed a fear of China—but not in terms of an invasion or military engagement. “Our opponents (the KMT party) want close ties with China. Too close. This is how Taiwan would be sucked into China’s system—through economic and political entanglements,” he said.

He continued chanting support for Lai, but paused when asked about fear of war. “There won’t be war,” he said. “But there is a fight.”

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News Room January 12, 2024 January 12, 2024
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