Xi Jinping has dangled economic carrots with hopes that political consensus will follow. But the majority of Taiwanese citizens have little interest in abandoning their democracy.
The people of Taiwan are less than happy with their government. The island’s November 24 regional elections saw the opposition Kuomintang (KMT), which favors eventual unification with China, win several key races in a humiliation for the ruling Democratic Progressive Party (DPP), which favors eventual Taiwanese independence. The DPP had pushed through unpopular pension reforms, failed to significantly raise a low minimum wage, and was held responsible for sluggish economic growth — projected 2019 GDP growth was recently trimmed to 2.27%. Sensing an opening, Chinese leader Xi Jinping sought to ride the wave of the popular dissatisfaction in a January 2 speech heard and analyzed throughout Taiwan, promising a “one China” of shared prosperity, cross-strait economic ties, and “peaceful” unification on Beijing’s possibly not-so-peaceful terms.
Xi’s gambit appears to have backfired, as both major Taiwanese parties, backed by large swaths of their respective bases, denounced his message. But Xi was not wrong to emphasize the depth of ties, as China remains by far Taiwan’s largest trading partner. Victorious KMT leaders like Kaohsiung mayor Han Kuo-yu 韩国瑜 (Hán Guóyú) have promised an expansion of city-to-city cross-strait exchanges, touted on KMT campaign trails as defibrillation for a flatlining economy. The exchanges, long eyed with skepticism by DPP leadership, were originally the brainchild of Taipei mayor Ko Wen-je 柯文哲 (Kē Wénzhé), who used a 2015 visit to Shanghai for a twin-city forum to proclaim that “both sides of the Taiwan Strait are one family,” a comment that haunted the independent when the China-skeptical DPP dropped its support of his successful yet nail-bitingly close 2018 re-election campaign.
Regardless, Ko’s infamous statement is at least true in the inverse, as many families are still part of both sides of the Taiwan Strait. This includes the many Taiwanese citizens living and working in the PRC — a number estimated between 400,000 and 1 million at any given point in time. According to a 2018 survey by Taiwan’s 1111 online job bank, 76 percent of Taiwanese said they would be interested in working in China, citing linguistic and cultural similarities and a stronger economy.
This has led to worries within Taiwan that these overseas workers would be willing to leave democracy behind.
The notoriously eccentric Ko recently said he “hates” Taiwanese businesspeople who back independence but choose to work in China. A January 4 article in Inkstone spoke to five economically frustrated young Taiwanese and pinned four of them as open to unification with China, drawing a vicious backlash from Taiwan Twitter. “A sluggish economy may have made the people of Taiwan more responsive to Xi’s overtures,” the article reads, and this does mirror a sentiment common in Chinese state media and public discourse: If Taiwanese keep fleeing the island’s low wages for higher salaries across the strait, unification is sure to eventually follow.
However, the numbers fail to add up. Voters from both parties backed the otherwise embattled Taiwan President Tsai Ing-wen 蔡英文 (Cài Yīngwén) when she lambasted Xi’s proposal of “one country, two systems” for Taiwan. Over 85 percent of Taiwanese support Tsai’s policy framework for cross-strait relations, while 81 percent do not support Xi’s “one country, two systems” model, according to a survey published on January 9 by the Cross-Strait Policy Association. Taiwanese have long favored maintaining the political status quo over either an immediate or eventual push for unification with China, according to National Chengchi University’s Election Study Center. And young Taiwanese citizens are becoming more confident than ever in their identities as residents of Taiwan — regardless of whether they decide to work across the strait. Surveys have shown a consistent trend toward citizens of the nation self-identifying as Taiwanese rather than Chinese.
“Our generation is naturally independent by nature. We were born here,” said journalist Jessie Lu, 32. “Generations like our parents have been through war, through difficult times. They might have different understandings of the China-Taiwan relationship. But our generation was brought up thinking this is a country. It’s in our blood.”
The battle against “brain drain”
In the years since Taiwan President Tsai Ing-wen 蔡英文 (Cài Yīngwén) took power in 2016, the Chinese government has offered incentives to Taiwanese workers such as its “31 Measures,” which spokesman An Fengshan 安峰山 (Ān Fēngshān) of the PRC’s Taiwan Affairs Office said are designed to give Taiwanese residents and companies equal status with Chinese citizens, and the ability to apply for residence permits in the PRC, a measure that makes everyday tasks more convenient for Taiwanese citizens in China.
The measures are designed to make life more convenient for Taiwanese citizens in China — many of whom venture across the strait in pursuit of brighter career and future earnings opportunities despite being offered similar starting salaries to those available in Taiwan, according to Michael Boyden, managing director of Taiwan Asia Strategy Consulting. As many as 80,000 Taiwanese have applied for the permits in China since their introduction in September 2018, according to the director of Taiwan’s National Security Bureau.
While the incentives offered by the Chinese government have proven popular with Taiwanese citizens already living in China, they have thus far failed to spur an increase in workers leaving Taiwan, according to recent data from Taiwan’s Tourism Bureau and scholars at Academia Sinica in Taipei. “They will take the incentives while they can,” said Boyden, but he believes the program is generally “not going to capture their hearts and minds.”
“I don’t really think Taiwanese people who are used to democracy and freedom of speech want to change their citizenship, or want to unify with China,” said Yang Tzu-ting, an assistant research fellow at Academia Sinica’s Institute of Economics.
The allure of Chinese economic opportunities at the cost of enjoying Taiwanese values has nonetheless left the Tsai administration fearful of a potential “brain drain” from Taiwan to China. DPP lawmakers have proposed punitive countermeasures for Taiwanese citizens who choose to obtain PRC residence permits, floating the idea of imposing citizenship restrictions in the past, and, more recently, vowing to prioritize a bill barring permit holders from running for public office.
Such measures, if they ever pass, may give pause to Taiwanese citizens who are thinking of applying, said Yang. “They’ll take them without personal cost. Otherwise, they won’t,” he said.
The migration of skilled workers to China not only impacts the Taiwanese economy but also creates a potential security risk when high-paying Chinese firms poach Taiwanese semiconductor engineers. This practice has led to allegations by Taiwan and the United States of intellectual property theft perpetrated by Taiwanese employees who pass sensitive information to Chinese companies.
Yang said Taiwan’s own economy could be bolstered by allowing more Chinese professionals to seek work in Taiwan, which is currently heavily restricted due to security concerns. “The government needs to have a system to detect who really thwarts our national security and who does not,” he said.
After all, creating more opportunities at home may help stem the outflow of Taiwanese workers to China, most of whom plan to return to Taiwan in the first place. The Chinese government may be able to offer conveniences to Taiwanese, Yang said, but it “cannot change their views.”
Will Taiwan shift away from China?
Taiwanese workers who find employment in China either do so independently or after being placed in the PRC by their companies. Taiwanese businesses in China, often referred to as “Taishang,” are being urged by the Tsai administration to redirect their investments elsewhere as part of a larger pivot away from the PRC.
Since taking office in 2016, Tsai has touted her signature New Southbound Policy (NSP), which aims to establish stronger economic ties with South and Southeast Asian countries and loosen Taiwan’s dependence on China. The policy also contains provisions for cultural and people-based exchanges, such as university exchange programs, and has coalesced with a large-scale promotion of Southeast Asian language and culture by the Taiwanese government.
Early returns are limited — the policy has always been a long-term proposition — but the policy aims to first chip away at linguistic and societal divisions between Taiwan (in which most of the population consists of Mandarin-speaking Han Chinese) and its continental neighbors.
For Taiwanese, “the entry barrier to work in China is much lower than to work in Southeast Asia because of language and culture,” said Roy C. Lee, deputy executive director of Taiwan WTO & RTA Center at the Chung-Hua Institution for Economic Research. “These are limitations that prevent people from considering [countries like] the Philippines or Indonesia as possible places to work.”
However, Taiwanese investment has slowly begun to shift away from China and toward emerging Southeast Asian economies, a continuation of a trend starting in 2014 initially spurred by rising production costs in China along with the ascension of Xi Jinping, according to Lee. For the Tsai administration, the implementation of the New Southbound Policy has fortunately coalesced with trade tensions between China and the United States. “Tsai raised the idea [of the policy] long before Trump became a serious presidential candidate,” said Lee. “I don’t think anybody in Taiwan could have foreseen the upcoming trade war. But it is very facilitative to the current status in [Taiwan’s] change of international dynamics.”
Taiwanese businesses long rooted in China have begun to look elsewhere, such as Foxconn, which said in December it was considering shifting some iPhone production from China to Vietnam, citing the U.S.-China trade war. But “Taishang” that target China as a consumer market, rather than a manufacturing base, are likely to maintain a strong Chinese presence regardless of the New Southbound Policy — and will create continued employment opportunities for young Taiwanese.
China’s struggle to understand Taiwan
In January, three academics at Xiamen University’s Taiwan Research Institute published their findings (adapted here by Sixth Tone) on why Taiwanese workers usually opt not to stay in China for the long run. “Taiwanese youth are generally not well-integrated into the mainland’s society,” wrote assistant professor Chen Chao, citing China’s failure to integrate Taiwanese into their local communities, poor marketing of the opportunities available to Taiwanese made in China, and the need to “give them rights” in areas such as “policymaking or local consultative hearings.”
The authors noted that China is currently nowhere close to being able to provide participatory opportunities for workers from Taiwan — and young Taiwanese, even those interested in finding work in China, cite this as a reason why the PRC will never feel like home.
“I’m definitely open to working in China,” said Max, 22, a law student at Taoyuan’s Chung Yuan Christian University and an assistant to a KMT senator. “But I would go for another job, not to work in politics.”
“If the opportunity comes to work in China, I wouldn’t mind,” said a 25-year-old salesperson who gave his name as Kuo. “Young people now aren’t hostile toward China. However, I am concerned about the political system. I’m afraid that if I go, I might not be able to come back” — just by virtue of being Taiwanese, he means, a fear regardless for many, regardless of profession, because stories of CCP malfeasance are broadcast so loudly in Taiwan.
Lee, who has spent considerable time on both sides of the strait, said he was frequently subjected to “seminars” on cross-strait politics during his time in China, a strategy reportedly utilized by China’s Taiwan Affairs Office over the past month. “I became reluctant to go to China because all the seminars talk about the same thing. ‘You should support reunification.’ ‘One country, two systems’ will guarantee your lifestyle,’” said Lee, who noted that Taiwanese in China have long been subjected to seminars of this nature. “It’s not really an academic discussion.”
Taiwanese working in China “already know the government is monitoring them,” said Yang, who has spent time in China himself. He mentioned that people who have attended past seminars have told him the sessions — and the realities of living with surveillance and online censorship — make Taiwanese more appreciative of their democracy. “They may not love Taiwan at first,” he said, “but after they go to China, they do.”
Although there is little evidence that such “seminars” truly work, they appear to have spooked the DPP. Voices within the party have, in the past, advocated for Taiwan to be more confident in its dealings with China — to embrace cross-strait investment and people-based exchanges without fearing an ideological Communist invasion. (The “hypodermic needle theory” of direct influence, despite its enduring popularity, has been disproven by countless academics.) While Tsai has reiterated her openness to accept cross-strait exchanges should they adhere to a framework of mutual political understanding, this view has been largely relegated to the sidelines within her administration.
Observers say the Chinese government is likely to persist in its attempts to influence Taiwanese workers — and the Tsai administration continues to see China’s economic incentives as an existential threat. However, the government may face pushback from voters if it rapidly shuts the door to economic cooperation with China, said Lee. “We do need limitations and regulations, but the fundamental idea shouldn’t be: ‘We’re going to build a wall between China and Taiwan and everything will be fine,’” he said. “We need to understand the source of the risk and threat, and then assess.”