As Taiwan and China engage in the second round of negotiations on a proposed economic cooperation framework agreement (ECFA), it might be worthwhile to look at the long-term consequences of increasing Chinese investment in Taiwan.
Earlier this week, this paper referred to a recent report about possible People’s Republic of China (PRC) funding and involvement in the consortium of Hong Kong-based firms that has sought to acquire Nan Shan Financial Life Insurance Co. Earlier this month, financial regulators said they still had more than 40 unanswered questions about the application by one of the principal investors, China Strategic.
Nan Shan is the nation’s second-largest life insurer, with more than 4 million customers. If the Investment Commission approved the acquisition, this would be the largest takeover of a local financial group by foreign buyers in the nation’s history, which explains why regulators and the media have paid special attention to the case. However, Nan Shan is only one among many Taiwanese corporations from numerous sectors that are — or soon will be — coveted by Chinese and/or Hong Kong-based investors.
In the immediate term, attempted investments are already proving problematic. Nan Shan is one example; China Mobile’s attempt to acquire part of Far EasTone Telecommunications Co is another. What hasn’t been explored, however, are the long-term consequences of those acquisitions, even if, in the eyes of financial regulators, the investments are legal. Deals that involve murky and ill-defined consortiums, such as the one for Nan Shan, are especially troublesome. The reason for this stems from the fact that cross-strait investment — and by extension an ECFA — are all based on vague assurances by Beijing that, in the short term, may actually be implemented.
But what happens five, 10 years down the road after those companies have been acquired? What would Taiwan do if, say, the Hong Kong investors involved in the Nan Shan bid were exposed as having been controlled and financed by the PRC, or if Chinese firms, or the government, suddenly took over those Hong Kong investors? It is difficult to imagine that Nan Shan, or Taiwanese authorities, would decide to annul the investment, and next thing you know, Nan Shan would be controlled by Chinese investors and the personal information of more than 4 million Taiwanese made available to Chinese authorities.
What we must bear in mind is that despite laws that limit the share that Chinese investors can own in the Taiwanese financial sector — which prompted Chinese firms to turn to Hong Kong as an investment springboard — it will be next to impossible to ensure that the shareholder structure of those investing firms does not change in China’s favor at some point. In other words, the Chinese government could be using legitimate Hong Kong investors as Trojan Horses — legitimate on paper, but used as a means to an end — to penetrate the Taiwanese market.
Ironically, it is Hong Kong that provides the clearest warning to Taiwanese. In the years prior to handover in 1997, Beijing made a number of vague promises that the rights and welfare of the people of Hong Kong would be preserved. As Hong Kong academic and former legislator Christine Loh (陸恭蕙) wrote recently in her history of the Chinese Communist Party (CCP) in Hong Kong, however, the devil is in the details. Little by little, the people in the special administrative region found that those vague promises foundered on the shores of the core interests of the CCP. Universal suffrage was delayed time and again. Harsh security laws were implemented. Certain liberties were curtailed — all in the name of Beijing’s core interests: stability and one-party rule.
If Taiwanese are not careful, it could happen here.
Congratulations to China’s working class — they have officially entered the “Livestock Feed 2.0” era. While others are still researching how to achieve healthy and balanced diets, China has already evolved to the point where it does not matter whether you are actually eating food, as long as you can swallow it. There is no need for cooking, chewing or making decisions — just tear open a package, add some hot water and in a short three minutes you have something that can keep you alive for at least another six hours. This is not science fiction — it is reality.
A foreign colleague of mine asked me recently, “What is a safe distance from potential People’s Liberation Army (PLA) Rocket Force’s (PLARF) Taiwan targets?” This article will answer this question and help people living in Taiwan have a deeper understanding of the threat. Why is it important to understand PLA/PLARF targeting strategy? According to RAND analysis, the PLA’s “systems destruction warfare” focuses on crippling an adversary’s operational system by targeting its networks, especially leadership, command and control (C2) nodes, sensors, and information hubs. Admiral Samuel Paparo, commander of US Indo-Pacific Command, noted in his 15 May 2025 Sedona Forum keynote speech that, as
In a world increasingly defined by unpredictability, two actors stand out as islands of stability: Europe and Taiwan. One, a sprawling union of democracies, but under immense pressure, grappling with a geopolitical reality it was not originally designed for. The other, a vibrant, resilient democracy thriving as a technological global leader, but living under a growing existential threat. In response to rising uncertainties, they are both seeking resilience and learning to better position themselves. It is now time they recognize each other not just as partners of convenience, but as strategic and indispensable lifelines. The US, long seen as the anchor
Kinmen County’s political geography is provocative in and of itself. A pair of islets running up abreast the Chinese mainland, just 20 minutes by ferry from the Chinese city of Xiamen, Kinmen remains under the Taiwanese government’s control, after China’s failed invasion attempt in 1949. The provocative nature of Kinmen’s existence, along with the Matsu Islands off the coast of China’s Fuzhou City, has led to no shortage of outrageous takes and analyses in foreign media either fearmongering of a Chinese invasion or using these accidents of history to somehow understand Taiwan. Every few months a foreign reporter goes to