Posted by: mulrickillion | January 21, 2012

Why Ma Won the Elections and What’s Next for Taiwan and China

By Daniel Lynch, Foreign Affairs, Jan 15, 2012 —

It Was About More Than the Economy, Stupid 

In presidential elections this weekend, Ma Ying-jeou, Taiwan’s incumbent president from the ruling Kuomintang (KMT), or Nationalist Party, decisively defeated Tsai Ing-wen of the Democratic Progressive Party (DPP). With about 52 percent of the vote (compared to Tsai’s 45.6 percent and the third-party candidate James Soong’s 2.8 percent), Ma will be able to govern with a clear majority of popular support. His margin of victory was far higher than most opinion polls had predicted. Many Soong supporters seem to have decided in recent days that by voting for their preferred candidate, who is almost politically identical to Ma, they might hand Tsai the victory.

During the campaign, most observers insisted that the election was not about cross-strait relations but about socio-economic issues, including rapid economic growth amid worsening inequality, reduced career opportunities for recent college graduates, and unaffordable housing costs. In fact, socio-economic issues are inseparable from cross-strait issues. Ma ran on his record of improving ties between China and Taiwan, claiming that friendship meant stability and prosperity and that a reversion to DPP rule would throw Taiwan back into the dark days of the mid-2000s, when DPP President Chen Shui-bian’s avowedly Taiwan-centric policies blocked negotiations even on direct passenger plane flights across the Taiwan Strait. Tsai, no protectionist or isolationist herself, promised not to roll back cooperation with China for the same reason. Her main criticism of Ma was that he is naive about China. According to her, issues of further integration — such as allowing Chinese professionals and white-collar workers to take jobs in Taiwan — should be approached cautiously.

For their part, voters seem to have accepted Ma’s contention that reducing cross-strait tensions improves the country’s economic well-being. Indeed, more than ever, Taiwan’s economy is dependent on China’s. This is partly a result of market dynamics (Taiwanese capital flows across the Taiwan Strait in search of lower production costs) and partly a result of the KMT and Chinese Communist Party’s efforts to facilitate integration. By the end of 2011, some 80,000 Taiwanese firms had invested up to $200 billion in mainland factories, research and development centers, stores, and restaurants. And annual trade between the two sides exceeded $150 billion. Meanwhile, out of a total population of 23 million, one million or more Taiwanese live in China. Directly or indirectly, the majority of Taiwanese households depend on Chinese economic dynamism for their livelihood.

These are the dynamics that had helped Ma win a landslide victory in the 2008 Taiwan elections to begin with. He had made the campaign promise to pursue something like a Taiwanese-Chinese common market. He delivered on this pledge in 2010 by signing with Beijing the Economic Cooperation Framework Agreement (ECFA), under which the two sides agreed to slash tariffs on a wide variety of goods and services. . . .

Why Ma Won the Elections and What’s Next for Taiwan and China | Foreign Affairs

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