US intervention in the Indo-Pacific pact arrangements, and US President Joe Biden’s subsequent discussions with Japan against Chinese regional influence and the need to defend Taiwan and isolate China, have rightfully promoted heated discussion throughout Taiwan.
This is the opposite of what is needed. In fact, this can be viewed as a US attempt to become central to the new Asian recovery as it occurs, in stark opposition to Chinese centrality in the region at present.
The general claims of the Western media, aided and abetted by a few premature forecasters in places such as Chicago, Harvard, Cambridge, or employed by the IMF, is that Chinese economic growth over the next year or so would fall to 2 percent. This seems plucked out of the air, as was the case of China’s projected growth in 2008, when that economy was the only large nation to continue strong economic growth throughout the recession period. Its manifold trading linkages were a principal recovery device, which possibly benefited middle income nations more than the US.
I am not saying that there is no threat from China, but I am suggesting that a sudden change in policy toward isolation from Chinese trade, investment, tourism, student exchanges and so on, together with a break in diplomacy, would be irresponsible at this time. Taiwan has been patiently waiting for many years now. The time to break that patience is not now when the US is especially needful of greater trade and strategic links with East Asia to firm up the possibility of its own economic recovery from the COVID-19 pandemic and worries over the NATO-Russia clash in Ukraine. Hasty activity in the US today need not mean hasty responses in Taiwan tomorrow.
To demand an abrupt decrease in economic relations with China would represent an economic disaster.
First, China’s real GDP growth prior to COVID-19 was 6.7 percent (2014-2019), India’s was the same, the EU’s was 1.9 percent, the US’ stood at 2.4 percent and the world’s GDP growth was 3.4 percent. Other things being equal, at this juncture hitching to high growth makes sense.
Second, and of greater importance, is the pattern of foreign trade associated with these different histories of growth. The complementarity of trade between Taiwan, China, India and Japan is high, because together they span the range of income levels and industrial structures. That is, the production of any one of these nations easily becomes the imports of the others — thus the key higher technology of Japan and Taiwan does flow to China and India. China’s consumer goods flow out because of low-cost production, much based on earlier imported technologies, and so on.
Third, behind the trade pattern lie underlying economic structures, ones in which China remains clearly complementary to Taiwan, whatever their regional political and territorial divergencies. Approaching middle incomes, with a huge growing middle class, and with a large manufacturing sector, China will continue to need higher tech production from countries such as Taiwan and Japan. In contrast, slower US economic growth is based on a mature economy that has shifted from manufacturing — services employ about 80 percent of US workers.
Fourth, the world is not constrained only by the Ukraine war and its present constrictions on grain and other supplies, as it is perhaps even more affected by the continuation and economic echoes of the COVID-19 pandemic. Taiwan, alongside the rest of East Asia, has been far less affected by COVID-19 than the Europe and the US. The difference is enormous. COVID-19 cases per million since the virus’ emergence until Thursday last week stood at 448,738 for France, 324,923 for the UK and 255,923 for the US; but only 159,134 for Hong Kong, 68,635 for Taiwan, 30,693 for India and an incredible 155 for China. We might cast doubt on the last figure as it is extremely low, but time will tell.
Fifth, Taiwan falls naturally into a global recovery system based in Asia and most certainly including China. For all the reasons given above, the US-Europe Atlantic-based system shall recover more slowly than the nations of Asia and elsewhere — particularly so in comparison to East Asia. The global economy for some time will dictate that China should remain integral to the more dynamic portion of the world system following the Ukraine debacle.
When all is said, surely the most crucial task is to avoid the potential dangers at the level of geopolitics.
A continued commercial alliance of China, India and Japan is very important to Taiwan, and to potential world growth and the spread of wealth effects through a wider section of our world’s population.
I am not positing any break with the US, but I am emphasizing the need for political caution in a world of economic uncertainty.
This might demand some compromises to maintain important status quo positions in Taiwan and Hong Kong, but is that a more difficult task than the one that might fall in behind any withdrawal from relations with China, whether by Taiwan or other allies? In the larger picture, China’s growth will be complementary to that of East Asia, continuing to suck in high-tech imports, strategic capital investments, and scientific and proprietary knowledge and expertise, as well as institutional and regulatory models from the rest of the world. In return, they shall receive a multitude of electrical goods, telecom equipment, office machinery and basic consumer goods that China supplies on highly competitive grounds.
This might not sound like a long-term global solution to the problems of recovery, growth, income distribution and social and environmental welfare, but as the continuation of an interim situation in a global world of rapid change, it is a step above the rhetoric of separation of or from China. The US and Europe might or might not be able to afford such public attitudes; only more time shall tell.
Ian Inkster is professorial research associate at the Centre of Taiwan Studies at SOAS University of London and a senior fellow in the Taiwan Studies Programme and China Policy Institute at the University of Nottingham.
As strategic tensions escalate across the vast Indo-Pacific region, Taiwan has emerged as more than a potential flashpoint. It is the fulcrum upon which the credibility of the evolving American-led strategy of integrated deterrence now rests. How the US and regional powers like Japan respond to Taiwan’s defense, and how credible the deterrent against Chinese aggression proves to be, will profoundly shape the Indo-Pacific security architecture for years to come. A successful defense of Taiwan through strengthened deterrence in the Indo-Pacific would enhance the credibility of the US-led alliance system and underpin America’s global preeminence, while a failure of integrated deterrence would
It is being said every second day: The ongoing recall campaign in Taiwan — where citizens are trying to collect enough signatures to trigger re-elections for a number of Chinese Nationalist Party (KMT) legislators — is orchestrated by the Democratic Progressive Party (DPP), or even President William Lai (賴清德) himself. The KMT makes the claim, and foreign media and analysts repeat it. However, they never show any proof — because there is not any. It is alarming how easily academics, journalists and experts toss around claims that amount to accusing a democratic government of conspiracy — without a shred of evidence. These
Taiwan is confronting escalating threats from its behemoth neighbor. Last month, the Chinese People’s Liberation Army conducted live-fire drills in the East China Sea, practicing blockades and precision strikes on simulated targets, while its escalating cyberattacks targeting government, financial and telecommunication systems threaten to disrupt Taiwan’s digital infrastructure. The mounting geopolitical pressure underscores Taiwan’s need to strengthen its defense capabilities to deter possible aggression and improve civilian preparedness. The consequences of inadequate preparation have been made all too clear by the tragic situation in Ukraine. Taiwan can build on its successful COVID-19 response, marked by effective planning and execution, to enhance
Since taking office, US President Donald Trump has upheld the core goals of “making America safer, stronger, and more prosperous,” fully implementing an “America first” policy. Countries have responded cautiously to the fresh style and rapid pace of the new Trump administration. The US has prioritized reindustrialization, building a stronger US role in the Indo-Pacific, and countering China’s malicious influence. This has created a high degree of alignment between the interests of Taiwan and the US in security, economics, technology and other spheres. Taiwan must properly understand the Trump administration’s intentions and coordinate, connect and correspond with US strategic goals.
RSS