The Asian Infrastructure Investment Bank (AIIB) is no less a blow to US global interests and Taiwan than the Korean War during the 1950s. The AIIB, with its headquarters in Beijing, is part of Chinese President Xi Jinping’s (習近平) grand strategic plan for a “One Belt, One Road” modern equivalent to the Silk Road. During last year’s APEC conference, the US was already imploring its allies not to join the bank. Who would have thought that by March 13, the UK would announce its joining the AIIB as a founding member, setting itself up as the clearing center for Chinese yuan within Europe and initiating a domino effect?
In the tussle between the US and China over the AIIB, China appears to have won the first round: By March 31, more than 50 nations had indicated their intent to join the bank. US President Barack Obama’s prestige and standing have been irreparably damaged in what is surely the greatest humiliation of his seven years in office.
The AIIB incident is the opening salvo in the struggle for world domination between the US and China, and has ended in crushing defeat for the US. How?
Surprisingly, the root cause of this conflict involves Taiwan. In the international sphere, participating in the economic development of different nations is common. However, in directing all of its resources toward a single nation’s economic development, Taiwan is unique.
Taiwan’s gross national product is on average just US$400 billion per year, yet in the short period from 2000 to 2010, Taiwan’s capital investment in China exceeded US$500 billion, helping to establish China as a world leader in high-tech manufacturing. Of China’s 10 largest export manufacturers in 2010, five were Taiwanese firms. Taiwan has helped China accumulate more than US$3.8 trillion in foreign reserves.
Bizarrely, Washington’s mistaken view that it was in the US’ interest to encourage cross-strait cooperation had a major influence on China’s 10 years of building its strength and amassing cash reserves: If the US had not given the administrations of former president Chen Shui-bian (陳水扁) and President Ma Ying-jeou (馬英九) its approval — and even encouragement — for their cross-strait policies, Taiwan would not be in this mess.
Let bygones be bygones. Once the US has recovered from its bitter defeat over the AIIB, perhaps it will reflect upon its criticism of the UK. A US official was quoted as saying: “We are wary about a trend toward constant accommodation of China, which is not the best way to engage a rising power.”
Washington should fully acknowledge and make amends for its mistakes.
The US is no pushover: The 1957 Sputnik crisis jolted the US into action, so that within a few years it was able to challenge the then-USSR for the control of space. The AIIB is just the beginning of China’s battle for supremacy. The importance of Taiwan’s role must not be overlooked. Although Taiwan’s GDP has recently contracted, it remains the 27th-largest economy. The US debate about abandoning Taiwan is sure to subside with the AIIB a reality.
Democratic Progressive Party (DPP) Chairperson Tsai Ing-wen’s (蔡英文) visit to the US presents an ideal opportunity to tell Washington that Taiwan will always stand with a democratic and free US, and that Taiwan opposes joining the AIIB.
Perhaps at the same time, Tsai will persuade Washington to see the error of its support for Ma’s cross-strait trade pacts.
Whether Tsai is successful depends on the resolution of Taiwanese and the attitude of the DPP, as the torchbearer of “localist” politics in Taiwan.
Huang Tien-lin is former president and chairman of First Commercial Bank and a former Presidential Office adviser.
Translated by Edward Jones
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