Taiwan election another headache for Beijing
1 Sep 2023|

On Monday, Terry Gou announced his intention to stand as a candidate in Taiwan’s 2024 presidential election. He joins Vice President Lai Ching-te from the ruling Democratic Progressive Party (DPP), Hou You-yi from the Kuomintang (KMT) and Ke Wen-je from the Taiwan People’s Party (TPP). Gou is the billionaire founder of Foxconn, the huge contract electronics manufacturer that produces iPhones and numerous other consumer electronics products.

Gou is using his financial resources to run as an independent, although he has well-established links to the opposition KMT and sought its nomination as a presidential candidate in the 2020 and upcoming elections. As an independent, he needs 290,000 signatures on a petition by 14 November to be on the ballot.

Gou’s pitch is that his business success means he can manage Beijing and strengthen Taiwan’s economy. He claims to be pragmatic and non-ideological (in a veiled criticism of the Taiwan identity politics of the DPP), and he has put forward headline goals such as overtaking Singapore’s per capita GDP. He also makes appeals to the sea goddess Matsu for Taiwan’s peace and prosperity.

There may be enough voter fatigue with the DPP, frustration with a slowing economy and disaffection with the other candidates for Gou to generate campaign momentum using his financial resources. He has no party machinery, but his previous tilts at presidential runs mean he isn’t starting from zero. There has also been speculation that he’s playing a longer game for political influence.

In practice, however, he is offering a similar socially conservative, pro-business message to the KMT’s Hou and the TPP’s Ke. He is likely to divide that constituency even more than it already is, in a first-past-the-post voting system.

He is also entering the race as Lai’s campaign is warming up. Lai visited Paraguay in August, and had stopovers in New York and San Francisco to meet with US officials and the Taiwanese American community. It gave Taiwan’s voters a chance to envisage Lai as president. He conducted an interview with Bloomberg in which he committed to continuing the disciplined foreign and cross-strait policy of President Tsai Ing-wen. Lai’s campaign has so far been without major upsets. His party is united behind him, and he is seeing a bump in polling—one poll has him now over 40% and his rivals drifting further behind.

The usual caveats apply as in any election. Mistakes and crises could yet derail Lai’s campaign. But it’s hard to see Gou’s entry into the race as anything other than making Lai’s run easier.

More broadly, Gou inevitably represents a passing era for Taiwan’s place in the modern global economy. In his business, he brought together Chinese labour, Taiwanese capital and American consumers. Rural workers in China entered the urban wage-labour market mobilised by Taiwanese capital and manufacturing know-how to assemble US-designed products at the lowest cost and for the highest profit in vast Taiwanese-owned factories to satiate American demand for the newest electronic devices.

In domestic politics, Taiwan’s place in this global political economic configuration worked most effectively during the presidency of the KMT’s Ma Ying-jeou from 2008 to 2016. Ma, personally committed to a Chinese identity for Taiwan and accommodating of Taiwanese business leaders, was for a time able articulate a vision for Taiwan between China’s economic boom and America’s corporate and consumer power.

But Ma’s presidency ended rancorously and, as is now clear, the world in which Gou prospered is coming to an end. Chinese Communist Party ideology under Xi Jinping has hardened inexorably and China’s economic model, in which Foxconn has a part, is no longer working. A new vocabulary of security, resilience and strategic competition is shaping politics in Taiwan as elsewhere.

The emerging era has been an easier pivot for the DPP. Tsai has repurposed the party’s sometimes emotive Taiwan-centric politics into a cool-headed argument for Taiwan’s security and democratic resilience in the face of Beijing’s military threats and total policy intransigence.

For Beijing, if the new era means the DPP is starting to look like Taiwan’s natural party of government at the national level, it is an ideological crisis and tactical dilemma.

Beijing has defined the DPP as a party of separatists colluding with foreign forces to prevent unification against the will of the Taiwanese people and what it calls ‘the tide of history’. That argument could work ideologically, though not empirically, if a more Beijing-oriented government came back into power and Beijing could claim that the Tsai presidency was a deviation from the norm. But a win for Lai and a third DPP presidential term would pose a fundamental challenge to the logic of the CCP’s Taiwan ideology.

Under his totalising leadership, it becomes a crisis for Xi, along with the economy, the management of the pandemic and a growing list of other issues.

Tactically, Beijing has already constrained its room to manoeuvre by escalating its threatening military activity in the Taiwan Strait over the past several years. De-escalation is politically impossible, but further escalation becomes more dangerous from a threat baseline that Beijing sets ever higher.

Australia has been sharpening its policy around the concept of deterrence but habitually pursues rigid formulations to address Taiwan’s situation. The government makes rote statements calling for ‘no unilateral change in the status quo’ to manage its cross-strait relations policy.

The post-Tsai era may require more flexibility and dynamism from Canberra to respond to a less stable Taiwan Strait.