China recently introduced 31 incentives aimed at attracting Taiwanese. Fourteen of these are nothing but old wine in new bottles, but the other 17 are quite new.
Beijing has two reasons for this major move.
First, the incentives are an extension of the two policies aimed at residents in central and southern Taiwan, middle and low-income families, small and medium-sized enterprises, and young people (the “three middles and the youth” policy, 三中一青), as well as the young generation and the grassroots level (the “one generation and one stratum” policy, 一代一線). They are aimed at attracting the younger generation who support Taiwanese independence, because that is all they have ever known, and turning them into a pro-unification vanguard.
Second, the incentives are designed to draw a second wave of investment from Taiwan.
Between 1990 and 2016, China’s attempt to attract Taiwanese focused on businesspeople and capital investment. It succeeded in drawing in capital worth about US$900 billion, along with new technologies, making China the largest trading country and the second-largest economy in the world.
However, after Chinese President Xi Jinping (習近平) began to reveal his despotic ambitions, most attempts by Chinese companies to acquire foreign businesses or to bring high-end technologies into China have been prohibited by other countries.
Most recently, Singapore-based Broadcom’s attempt to acquire smartphone chipmaker Qualcomm was blocked by US President Donald Trump, because of Broadcom’s close relations with China.
Under these circumstances, the only way China would be able to achieve its goal of becoming a technology giant by 2025 would be to recruit high-tech talent from Taiwan and encourage Taiwanese students and researchers to share trade secrets.
Taiwan would then become key to the outcome of the US-China power struggle and their economic war.
The Taiwanese government must therefore make responding to China’s 31 incentives a priority and stand firmly with the West to secure an economic advantage.
I have previously argued (“Taiwan in need of US-like security clearances,” March 21, page 8) that the government should raise the national security level by establishing a security clearance system similar to that in the US as soon as possible.
Anyone who has worked, studied or conducted research or business in China should have to undergo a rigorous security clearance review if they return to work in a government institution or sensitive high-tech company.
This would not constitute an infringement on personal freedom. Rather, a review should be regarded as an expression of loyalty to the nation.
By setting up a proper national security clearance system, the government could avoid being accused of “punishing people without first instructing them,” as Confucius said, and the public would also learn the importance of national identity.
If the US can do it, there is no reason Taiwan should not be able to.
Such a system should be the first line of defense against China’s 31 incentives. If such a security clearance system was already in place, the controversy over the National Taiwan University presidential election would have been resolved long ago.
The second line of defense should be the eight strategies for strengthening Taiwan proposed by the Executive Yuan on March 16.
This would be the second line of defense, and not the first, because the eight strategies would be reactive rather than proactive.
To make up for this shortcoming, the government should consider restoring the stock bonus mechanism, which levied taxes on the face value of shares. This would be far more effective than the implementation of sporadic bonus policies. As long as it resulted in the creation of a few unicorn companies, it would result in increased tax revenue.
The third line of defense would be an exercise of state power: amending the Trade Secrets Act (營業秘密法) and having the different ministries impose prohibitive measures, such as the Ministry of Education’s plan to bar Taiwanese academics with crucial expertise from participating in Chinese state-funded research programs.
It is important to understand that Taiwan is facing an economic war waged by a country ruled by authoritarian nationalism and which has an economy that is 20 to 30 times bigger than Taiwan’s. The ultimate goal of this country is to annex Taiwan.
This is a war far removed from issues of liberalization and internationalization, and without a leader with a vision of national sovereignty, Taiwan will not succeed.
Huang Tien-lin is a national policy adviser and former managing director and chairman of First Commercial Bank.
Translated by Chang Ho-ming
Recently, the Liberty Times (the Taipei Times’ sister newspaper) published three of my articles on the US presidential election, which is to be held on Nov. 5. I would like to share my perspective on the intense and stalemated presidential election with the people of Taiwan, as well as Taiwanese and Chinese Americans in the US. The current consensus of both major US political parties is to counter China and protect Taiwan. However, I do not trust former US president Donald Trump. He has questioned the US’ commitment to defending Taiwan and explicitly stated the significant challenges involved in doing so. “Trump believes
The government is considering building a semiconductor cluster in Europe, specifically in the Czech Republic, to support Taiwan Semiconductor Manufacturing Co’s (TSMC) new fab in Dresden, Germany, and to help local companies explore new business opportunities there. Europe wants to ensure the security of its semiconductor sector, but a lack of comprehensive supply chains there could pose significant risks to semiconductor clusters. The Czech government is aggressively seeking to build its own semiconductor industry and showing strong interest in collaborating with Taiwanese companies. Executive Yuan Secretary-General Kung Ming-hsin (龔明鑫) on Friday said that Taiwan is optimistic about building a semiconductor cluster in
China has successfully held its Forum on China-Africa Cooperation, with 53 of 55 countries from the African Union (AU) participating. The two countries that did not participate were Eswatini and the Sahrawi Arab Democratic Republic, which have no diplomatic relations with China. Twenty-four leaders were reported to have participated. Despite African countries complaining about summit fatigue, with recent summits held with Russia, Italy, South Korea, the US and Indonesia, as well as Japan next month, they still turned up in large numbers in Beijing. China’s ability to attract most of the African leaders to a summit demonstrates that it is still being
The Russian city of Vladivostok lies approximately 45km from the Sino-Russian border on the Sea of Japan. The area was not always Russian territory: It was once the site of a Chinese settlement. The settlement would later be known as Yongmingcheng (永明城), the “city of eternal light,” during the Yuan Dynasty. That light was extinguished in 1858 when a large area of land was ceded by the Qing Dynasty to the Russian Empire with the signing of the Treaty of Aigun. The People’s Republic of China founded by the Chinese Communist Party (CCP) has never ruled Taiwan. Taiwan was governed by the
RSS