China Faces Few Good Options in Taiwan Electoral Outcome

By Christopher Bodeen 15 January 2016

BEIJING — China isn’t going to be happy with the likely victory for Taiwan’s pro-independence opposition in this weekend’s presidential election, but it has limited options to respond: Any angry reaction could further alienate the island’s public, while a passive response could weaken Beijing’s influence there.

Beijing may wait and see, and impose economic and diplomatic pressure gradually if a new Taiwanese administration does too much to carve out an identity separate from the mainland. China views the island, which split from the mainland in 1949 amid civil war, as part of its territory that must be reclaimed, by force if necessary.

The two sides have grown closer in recent years amid increased travel, communication and trade under the outgoing Nationalist President Ma Ying-jeou, who pushed for warmer ties.

But fears about the economic threat posed by China, from the mainland’s rising technology capabilities to its large pool of college graduates willing to work for less, have pushed many Taiwanese voters toward the opposition Democratic Progressive Party and fueled a “Sunflower Movement” of student protesters who oppose closer relations with the mainland.

Although DPP candidate Tsai Ing-wen has pledged to maintain the status quo, she has refused to endorse a previous consensus between her predecessor and Beijing that considers Taiwan to be a part of China—something Beijing insists is a bottom line to talks between the sides.

Beijing seems resigned to Tsai’s victory, and is not likely to take any drastic action initially.

“There will be an observation period,” said Dali Yang, an expert on Chinese politics at the University of Chicago.

Most surveys on the island show Tsai holding a commanding lead over the Nationalist Party’s Eric Chu.

China has largely kept quiet during the campaign, although its chief official for Taiwan affairs spoke this month of “new challenges” in the year ahead. Beijing’s reticence is a tacit acknowledgement that it has little sway over electoral realities in Taiwan, including the Nationalists’ weakness and the newly emboldened youth movement.

Tsai has also been careful not to push Beijing’s buttons with inflammatory rhetoric. In fact, she has avoided making Taiwan’s national identity a key issue in the election, leaving herself room for post-election adjustments, said Peking University China expert Niu Jun.

The election comes barely two months after a historic meeting in Singapore between Ma, the outgoing president, and China’s Xi Jinping, the first face-to-face encounter between the sides’ heads of state since they split in 1949 amid a bitter civil war.

The symbolic meeting was widely seen as an attempt by Beijing to elevate the status of the presidential office and lock-in high-level contacts between the sides before a change of administration.

China hoped that would set an important precedent and offered extraordinary concessions to make it happen, including agreeing not to use formal titles or have Chinese flags in the room. A major meltdown in relations could scupper hopes for another such encounter while making Xi’s flexibility look ill-advised, said University of Virginia China scholar Brantly Womack.

Beijing “will lose face if the handshake proves to [have been] a mistake,” Womack said.

China isn’t spoiling for yet another crisis, with a stock market in free-fall, sharpening maritime disputes, an ongoing campaign against corruption and unrest among Uighur Muslims in the northwestern Xinjiang region. China this year will also undertake an ambitious streamlining of the 2.3 million-member People’s Liberation Army that will see hundreds of thousands job cuts.

Still, China can’t afford to be wholly passive and see its relevance to Taiwan erode. If Tsai continues to reject the so-called “One China Policy,” roll-back Ma’s pro-China agenda or aggressively seek to expand Taiwan’s international presence, a response could be in the offing.

Beijing could initially suspend contacts between the bodies tasked with negotiating trade and travel agreements. Or it could exclude Taiwan or restrict its participation in international organizations, especially China’s newly established Asian Infrastructure Investment Bank.

China might also start pressing countries that have diplomatic ties with Taiwan—22 at present — to sever relations.

Beijing will “test Tsai and if it concludes that Tsai is ‘responding inappropriately,’ it will get more negative,” said Steve Tsang, senior fellow at the University of Nottingham’s China Policy Institute.

Chinese authorities could also reduce the number of mainland tourists it allows to visit Taiwan, or shift some of its state companies’ large orders to firms from other countries, although most observers say economic measures are unlikely. Taiwan relies on the mainland market to absorb about 30 percent of its exports, while Chinese companies, including some with ties to the military, are hotly pursuing stakes in Taiwanese high-tech firms.

Even less likely is that Beijing would mobilize its army in an attempt to intimidate Tsai and the Taiwanese public. Previous attempts to do this have backfired, including missile launches during the run-up to a 1996 election that were widely seen as solidifying support for the candidate Beijing opposed.

While China continues to point more than 1,000 missiles at the island, the military hasn’t been openly deployed in such a role in almost two decades.

“I do not expect any sort of security crisis,” said Alan Romberg, East Asia Program direct at the Stimson Center think tank in Washington DC. “I suppose both sides could mismanage things too badly that there could be a vicious downward cycle of action and reaction, but I frankly don’t foresee that.”