China’s Taiwan Affairs Office Minister Zhang Zhijun (張志軍) spoke harshly at this year’s National Taiwanese Business Association directors’ conference, saying that members of the Taiwanese business community should not be allowed to make money in China and then support Taiwanese independence on their return to Taiwan.
Zhang made four suggestions to the Taiwanese Business Association and the Association of Taiwan Investment Enterprises on the Mainland, which included encouraging cross-strait exchanges among young Taiwanese; furthering the common destiny of people on either side of the Taiwan Strait, upholding the principle of “one China,” opposing Taiwanese independence and maintaining and promoting the peaceful development of the cross-strait relationship.
Zhang was simply regurgitating a tired-out formula — even Chinese National Federation of Industries chairman Rock Hsu seemed to lose patience, asking if Zhang is unaware of the reports of attacks — orchestrated by Beijing — on pan-green Taiwanese businesses operating in China.
Zhang’s speech shows that Beijing has once again decided to meddle with Taiwanese businesses operating in China.
Taiwanese seafood restaurant chain Hai Pa Wang — which operates in China and has been labeled a pro-Taiwanese independence enterprise by Beijing for investors’ perceived close ties to President Tsai Ing-wen’s (蔡英文) administration — was fined by Chinese authorities for mislabeled food products.
Following last week’s telephone call between Tsai and US president-elect Donald Trump, the company took out an advertisement in Chinese-language newspaper the China Times, which included the statement: “Both sides of the [Taiwan] Strait belong to ‘one China.’” There was an immediate backlash with even Chinese Nationalist Party (KMT) legislators refusing to back Hai Pa Wang.
Hai Pa Wang is by no means the first Taiwanese company to be bullied by Beijing. Why, then have Taiwanese companies continued to bring destruction upon themselves and, in doing so, help Beijing to create economic growth, jobs and increase tax revenue?
The Tsai-Trump telephone call broke with diplomatic convention and sparked several days of heated discussions, which made it easy for China to fill the airwaves with negative coverage.
Not willing to be outdone, Trump tweeted: “Interesting how the US sells Taiwan billions of [US] dollars of military equipment but I should not accept a congratulatory call.”
He followed this up with two more tweets:
“Did China ask us if it was OK to devalue their currency (making it hard for our companies to compete), heavily tax our products going into… their country (the US doesn’t tax them) or to build a massive military complex in the middle of the South China Sea? I don’t think so!”
The US’ and China’s respective stances toward Taiwan could not be more different. In all of Beijing’s dealings with Taiwan, everything comes down to politics — economic considerations are never dealt with in isolation. Taiwanese businesses operating in China are therefore required to engage in politics, and this is why Beijing says that Taiwanese businesses cannot make money in China while also supporting Taiwanese independence.
Taiwanese companies have brought a significant amount of capital into China and helped the country open up and develop. At the same time, Taiwanese businesses have created job opportunities, increased workers’ incomes and contributed to China’s economic growth.
This is a normal function of global investment and trade; it is therefore wrong to say that Taiwanese businesses “making money in China” are the only beneficiaries of their activity. Chinese leaders are trying to paint the benefits Taiwanese businesses have brought to the Chinese economy as a negative. Taiwanese business operating in China have been reduced to the status of cash machines, in a never-ending political nightmare.
Supposing Beijing had welcomed investment from Taiwanese businesses, but without any political strings attached — Taiwan would have let down its guard over fears of a Chinese takeover via the economy. This would have been a far more effective strategy for China to annex Taiwan.
Trump’s stance regarding US sales of military equipment to Taiwan and China’s devaluation of the yuan and imposition of heavy tariffs on US products, is purely about business.
At the same time, Trump views US sales of military equipment to Taiwan and China’s construction of military installations in the South China Sea as pure and simple military strategy. In addressing these issues, Trump the businessman has clearly drawn red lines in terms of US interests.
Trump is simultaneously attending to US strategic and economic interests. This shows that Trump is not prepared to sacrifice US strategic interest at the altar of the economy and visa versa. He believes a balance must be struck between the former and the latter in order to “make America great again.” This is why he advocates the return of US manufacturing to America, pulling out of the Trans-Pacific Partnership trade agreement and making Taiwan, Japan and South Korea pay more into the US Asia-Pacific defense umbrella.
Although the telephone call can be viewed as a gain for Taiwan, both the public and the government must prepare to accept US demands, such as relaxing import restrictions on US beef and pork and increasing spending on defense: Trump certainly does not believe there is such a thing as a free lunch.
Beijing’s squeeze on Chinese tourists coming to Taiwan following Tsai’s presidental inauguration was an attempt to pressure the incoming administration to accept the so-called “1992 consensus.” If Taiwan does not wean itself off its over-reliance on the Chinese economy, this threat could evolve into an even greater danger: Chinese economic sanctions aimed at forcing Taiwan to accept that it belongs to “one China.”
Chinese President Xi Jinping (習近平) will not accept a call from Tsai; the US president-elect is willing to — who is Taiwan’s real friend?
If Taiwan sides with the US, it would bring mutual economic benefits, a sustainable future and a convergence of strategic interests. If Taiwan continues to align itself with China, economic growth and increased prosperity is by no means a given. Taiwan would be forced to accept Beijing’s politics and yield to China’s strategic aim to supplant the US and its regional allies.
Who will Taiwan’s 23 million people choose to be their friend and ally?
Translated by Edward Jones
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