In US politics, it is not uncommon to see politicians sign pledges on various policy platforms during election season so that voters can get a clear account of where the politicians stand on various issues and so that they stick to their word once elected. Last year’s primary season in the US was full of pledges, most of them absurd or too ubiquitous to have any real weight. However, in the case of Taiwan, I feel that President Ma Ying-jeou (馬英九) could do a lot to assuage the fears of many Taiwanese about the future of Taiwan following elections in January next year by signing a simple three-point pledge.
This pledge could be worded along the following lines:
“I, Ma Ying-jeou, my party, my government and all its official and semi-official institutions hereby 1) promise to respect the Central Election Commission’s announced results of the combined 2012 elections and to not engage in protests or actions damaging to Taiwan’s democracy and its international reputation; 2) promise to not engage in any cross-strait negotiations or sign any deals with Chinese authorities, official or otherwise, in the period between the elections and the inauguration of the new president in May, should I and my party lose the forthcoming presidential or legislative elections; and 3) promise that the content of any political negotiations with China be made available to the public and that any political agreement(s) or peace agreement be put to a legitimately conducted national referendum, being only signed and ratified following the passing of such a referendum as by the law.”
Although I would be skeptical that this government and presidency would abide by these promises even if they pledged to do so, I think making the pledge in itself would ease the fears of Taiwanese and perhaps allow the election campaign to be about the substance of each candidate’s policies rather than a vote on cross-strait relations. This would go much further to deepening Taiwan’s spirit of democracy and Taiwanese faith in the democratic process than any number of hollow and conveniently timed announcements of love for and allegiance to Taiwan.
I was overjoyed when I read that AU Optronics (AUO) would cease their 8.5G capacity expansion plans in China (“AUO posts third quarterly loss,” July 28, page 12). It’s about time that one of Taiwan’s major tech players faced up to the reality of the nation’s increasingly pessimistic macroeconomic environment.
First, however, let’s talk about ProMOS, the “too big to sail” DRAM behemoth, currently floundering in an ocean of red ink. The ProMOS management, like many soon-to-tank Taiwanese IT firms, followed this “Woo-hoo! Growth! Growth! Growth!” strategy several years ago, which sadly will become their undoing.
Shareholders, get out while you can and leave the banks to take the losses. If you look at the fundamentals, ProMOS is engaged in selling outdated chips to a dying industry, namely, PCs, notebook computers, “netbooks” and other similar devices. Bank of Taiwan and Taiwan Cooperative Bank, get ready to write these losses off. You placed your bets on a three-legged horse with attention deficit disorder.
When the massively successful iPad began its dominant march, did ProMOS slow down? No. Its was the “3Gs” strategy once again: “Growth! Growth! Growth! Let’s borrow more money and expand our capital expenditure!”
I can promise that ProMOS will never be profitable again, regardless of all their gimmicks and tricks. Investors, beware.
Meanwhile, AUO has been competing in the large-panel TV segment and just posted a loss for the third straight quarter. This comes as no surprise to me considering that China’s knockoff fabs stole Taiwanese technology and are currently building capacity for their domestic market with their “white box” brands like the pirates they are.
Lately, the large-screen TV demand in debt-plagued European and US markets has been tapering off. Sadly, with their weak macro analysis, AUO never saw this coming. And imagine their surprise when HD pico projectors really start taking off and cannibalizing this market completely.
Analysts quoted in the Taipei Times frequently say that this is because of upcoming austerity measures in major markets. Again, the simple truth belies this trend: If all of the world’s large-panel LCD TV makers ramped up their capacity to the max, there would be enough to sell three large-screen TVs to each subsistence farmer in India — not exactly a prime market. How many TVs can a person watch at one time and are consumers really demanding flat-screen TVs that are thinner than they already are now?
Moving on to shippers such as Yang Ming Marine and Evergreen, ignoring macro factors entirely, the foolish management at these companies continues to believe the world is entering a new growth phase and that they will benefit. Despite falling shipping rates from Asia to the EU and US and ongoing diminishing profit margins, these companies continue to buy new ships, apparently ignoring the fact that we are inexorably headed toward an inevitable, resource-constrained, steady-state global economy.
Yonghe, New Taipei City
Japanese Prime Minister Fumio Kishida on Thursday last week met with Chinese President Xi Jinping (習近平) at an APEC summit in Thailand. The meeting made front-page news in Japan the following day. Three years ago, when then-Japanese prime minister Shinzo Abe visited Beijing to meet with Xi, no one questioned Abe’s attitude toward China, as the conservative parties in Japan had been spearheaded by Abe. However, Kishida could easily be labeled as pro-China, as he hails from Hiroshima — a place known for its anti-war, anti-nuclear movements — and was once the director of the Japan-China Friendship Association of Hiroshima.
It is quite the irony when former British prime minister Boris Johnson — a buffoon who for far too long was taken seriously — is branded a buffoon for saying something deadly serious. Following Johnson’s withering criticism of China at a business forum in Singapore on Wednesday last week, the event’s organizer, Michael Bloomberg, apologized to attendees, saying that Johnson was “trying to be amusing rather than informative and serious.” However, Johnson’s characterization of China as a “coercive autocracy” that had showed “a candid disregard for the rule of international law” was spot-on. His comments evoked the wisdom of the Austrian-British philosopher
Although internal Chinese politics are largely defined by meticulously concocted mysteries, it is an open secret that the battle for who will ascend to the highest echelons of Zhongnanhai is decided at the Beidaihe resort. It is where factions within the Chinese Communist Party (CCP) engage in horse-trading over leadership selection and delegate appointments long before the party’s national congress. What unfolded at last month’s 20th National Congress was predetermined at the Beidaihe gathering in August. In this context, the CCP, and particularly Chinese President and CCP General Secretary Xi Jinping (習近平), used the event to project power and party unity.
There has been a surge of global interest in Taiwan’s security in recent years. Amidst the noise, it can be easy to lose sight of broader trends that are shaping the environment within which Taiwan operates. Taking a broader view can bring into focus what tasks are most important for Taiwan to protect its democratic way of life. At the global level, several trends are unfolding in parallel. First, great power competition is intensifying. Russia is employing violence to seek to redraw boundaries. China is advancing its ambitions by operating below the threshold of conflict. China-Russia relations are unnaturally close by