Towering Taiwan

| September 26, 2014 | 0 Comments
The secret of Taiwan’s economic competitiveness is small- and medium-sized enterprises. They account for more than 90 percent of business and 70 percent of local employment.

The secret of Taiwan’s economic competitiveness is small- and medium-sized enterprises. They account for more than 90 percent of business and 70 percent of local employment.

The tour guide in Taiwan stops next to a tiny marker along a park path. It has a design that features a small box with hard edges inside a larger box that has rounded corners.
The 20 journalists, invited from almost every continent to Taiwan by its foreign affairs department, look at the simple image expectantly.
The guide says: “This represents the nature of the Taiwanese people.” She points to the sharp corners of the small box: “We believe we should be hard on ourselves; we should be disciplined inside.”
“But outside,” pointing to the rounded corners, “we believe we should be soft with everyone else.”

The small island of Taiwan (located on the top right of this map) trades, competes and has territorial disputes with China, which makes no secret of its goal to absorb or take over Taiwan.

The small island of Taiwan (located on the top right of this map) trades, competes and has territorial disputes with China, which makes no secret of its goal to absorb or take over Taiwan.

Inside, the hardworking, disciplined Taiwanese have achieved astounding success in developing their island, the size of the Netherlands, into the world’s 17th-largest exporter and 18th-largest importer of merchandise in 2012.
Taiwan, formally known as the Republic of China, also ranks high in 2013 and 2014 indices:
• 3rd of 50 countries for investment climate by the Business Environment Risk Intelligence Index;
• 10th of 60 countries in Networked Readiness Index;
• 11th of 60 countries in the World Competitiveness Scoreboard;
• 12th of 148 countries in the Global Competitiveness Index;
• 17th of 185 countries in the Index of Economic Freedom;
• 16th of 189 countries in ease of doing business by the World Bank.
It is one of the world’s wealthiest countries, according to the CIA World Factbook 2014, holding the 7th-largest reserves in foreign exchange and gold in the world.

Perhaps the largest Taiwanese company is Foxconn, which now has 1.2 million workers.

Perhaps the largest Taiwanese company is Foxconn, which now has 1.2 million workers.

The secret of Taiwan’s economic competitiveness, says Manfred Peng, director general of the Ministry of Foreign Affairs’ International Information Services, is small- and medium-sized enterprises. They account for more than 90 percent of business and 70 percent of local employment.
“This stands in stark contrast with conglomerate-dominated Japan and South Korea,” says Mr. Peng, as well as Mainland China, “with its all-encompassing state-owned enterprises.”

More than half a million people joined the street protests against China’s selection of Hong Kong’s political candidates in Hong Kong in July.

More than half a million people joined the street protests against China’s selection of Hong Kong’s political candidates in Hong Kong in July.

And for the crucial niche Taiwan has filled globally, he says, around central Taichung City, the Golden Valley industrial cluster of businesses produces components for the world’s top four suppliers of semiconductor and display-panel industries. Interrupt this crucial supply chain product and “global production of iPhones would plummet,” he says, “and the world’s largest solar plant, part-owned by Google, in the Mojave Desert would go offline.”
The country specialises in science and technology, and the sector benefits from government grants and loans for invention. Taiwan Semiconductor Manufacturing Company and United Microelectronics Corp. are among the top custom integrated circuit chipmakers worldwide. According to the Global Competitiveness Report 2013-2014, Taiwan ranked No. 1 for cluster development and No. 5 in technological infrastructure.

The disputed islands, Senkaku (Diaoyu), are administered by the Japanese and claimed by China and Taiwan.

The disputed islands, Senkaku (Diaoyu), are administered by the Japanese and claimed by China and Taiwan.

Its 2012 global share of world products and services ranked Taiwan No. 1 for many information and communications technology products and services, with most revenues coming from its science parks, which generated nearly $68 billion in 2012. From 2012 to 2014, to encourage overseas Taiwanese-owned companies to invest at home, the government offered qualified companies loans from a US$333- million fund.
This tiny island of 36,000 square kilometres (excluding islands), is densely populated by 23 million people. It thrives through trade and tourism.
With a 2012 per-capita GDP at US $20,423 — a more prosperous year for the country than 2013, owing to the Eurozone slowdown — it ranks itself close to Argentina, Austria, Belgium and South Africa. Taking into account local purchasing power almost doubles per-capita GDP to nearly $40,000. Its 2012 GDP was US $475 billion (27th in the world) with exports accounting for US $301 billion and imports at $270.4 billion, creating a $30.7 billion surplus.

Chinese warships are now openly 'flying the flag' worldwide, particularly in the East and South China Seas.

Chinese warships are now openly ‘flying the flag’ worldwide, particularly in the East and South China Seas.

One of its top goals is to join the Trans-Pacific Partnership (TPP), a trade agreement whose potential members include Canada, the U.S., Japan, Australia, Mexico, Vietnam, Peru and Malaysia. Original signatories to the agreement are Brunei, New Zealand and Chile. In 2012, more than a third of Taiwan’s trade was already with these countries.
Taiwanese President Ma Ying-jeou has asked Canada to support his bid for TPP membership. In July, during a visit to Taiwan by Canadian parliamentarians, he said: “We really want to join the TPP in the future. We will become the 6th largest economy in the TPP once we join the trade bloc. The U.S. government has already welcomed our interest in the TPP. We hope that Canada can also lend its support.”

The towering Taipei 101 building was once the world’s tallest until it was outdone by a tower in the UAE.

The towering Taipei 101 building was once the world’s tallest until it was outdone by a tower in the UAE.

To improve Canada-Taiwan trade, he also voiced support for two agreements: a bilateral investment agreement and one that avoids double taxation.
The government estimates its TPP membership would add $78 billion in social welfare benefits for all TPP members. It would not come in as a minor partner: It is 10th among the APEC economies, according to the World Trade Organization. Taiwan is moving to liberalise its trade — even dealing with the ever-thorny problem of loosening protection of agricultural products, and it is setting up Free Economic Pilot Zones to draw investment and new industries.
Its other main goal is to join RCEP (the Regional Comprehensive Economic Partnership Agreement). RCEP members make up 29 percent of the world’s GDP and, according to Taiwanese government statistics, buy 57 percent of Taiwan’s exports. RCEP member states include Australia, China, India, Japan, Korea, New Zealand, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Mainland China is a dominant member and Taiwan’s entry would rest on China’s assent.

Lady Gaga performed in Taichung to a worldwide internet audience of 30 million fans.

Lady Gaga performed in Taichung to a worldwide internet audience of 30 million fans.

Taiwan also has free trade pacts: ECFA (Cross-Strait Economic Co-operation Framework Agreement) with Mainland China and FTAs with Singapore and New Zealand and a bilateral investment agreement with Japan.
Taiwan has large trade agreements under negotiation or discussion, among them the resumption of negotiations with the U.S., promised following an agreement on reducing residues of the growth stimulant ractopamine in U.S. beef and pork. The European Parliament passed a resolution in favour of the European Commission signing an FTA with Taiwan. And Australia, Chile, Hong Kong, the Philippines, Indonesia and India have indicated interest in signing FTAs with Taiwan.

Jason Hu, Taichung’s silver-tongued mayor.

Jason Hu, Taichung’s silver-tongued mayor.

The rounded edges — soft power — are most visible in the underspoken way of communicating in this Buddhist nation, whose people become acutely uncomfortable with loss of face and loss of self-control.
And nowhere is soft power used more often than in this tiny island’s relationship to Mainland China — the People’s Republic of China. This is the China that has 1,000 missiles pointed at Taiwan. It is also the China that is Taiwan’s No. 1 customer, receiving nearly 40 percent of its exports. As for imports, Mainland China (including Hong Kong) is Taiwan’s No. 2 — Japan is No. 1 — source of imports.
Taiwan’s foreign policy towards Mainland China has made a stunning about-face in recent years.
The previous president from the Democratic Progressive Party, President Chen Shui-bian, who held the post from 2000-2008, resisted close ties with Mainland China and maintained a distinctly cool relationship. He chose as his iconoclastic vice-president the Harvard Law School-educated Lu Hsiu-Lien (“Annette Lu”) to seek Taiwan’s independence and an equal seat with Mainland China — not today’s either-or — at the UN.

The King Car Whisky Distillery produces international award-winning spirits such as Kavalan single malt whisky.

The King Car Whisky Distillery produces international award-winning spirits such as Kavalan single malt whisky.

In 1995, she pushed a resolution through Taiwan’s legislature requesting that the government formally apply to become a member of the UN General Assembly. Then-UN secretary-general Boutros Boutros Ghali responded that the UN recognises Taiwan as part of China, she writes in her just-published book, My Fight for a New Taiwan, and is thus already represented. She had been imprisoned for five years for her pro-democracy, anti-Mainland China stance before becoming vice-president.
In the 2008 elections, Mr. Chen was replaced by President Ma Ying-jeou of the long-ruling Kuomintang “Nationalist” Party. Mr. Ma’s policy is to draw closer to China in trade, tourism and even immigration. (Interestingly, Mr. Ma, a fellow Harvard student, was instrumental in reducing Annette Lu’s sentence, thus speeding her release from prison.)

The night markets in Taipei sell street food, clothing, handicrafts and souvenirs.

The night markets in Taipei sell street food, clothing, handicrafts and souvenirs.

Mr. Chen and his wife were put in prison in 2009 for corruption and embezzlement. He remains there, in very poor health, serving a 19-year sentence, reduced from life in prison. His supporters are seeking his release from the tiny cell he shares with another prisoner, on humanitarian grounds.
The difference between the two presidents’ approaches to Mainland China is borne out quickly in statistics. Before 2008, only 300,000 Mainland Chinese visitors came to Taiwan. After the 2008 Tourism Agreement, in 2013, 5.3 million Taiwanese have visited Mainland China and 2.8 million Chinese have visited Taiwan. Before May 2008, there were no direct flights between the two countries. Now 828 flights are scheduled per week from 10 cities in Taiwan to 54 cities in Mainland China.
An estimated 1.3 million Taiwanese work or have business connections on the mainland. And 50 million to 80 million Mainland Chinese work for Taiwanese firms there. Perhaps the largest Taiwanese company is Foxconn, which now has 1.2 million workers, making 40 percent of the world’s electronic consumer products, including most of Apple’s iPhones. The company is China’s largest private employer and, among private employers worldwide, is third behind Walmart and McDonalds.
Still, it’s a political and security tightrope that Mr. Ma says he is determined to walk to strengthen his country. The controversy surrounding his policy is over whether he will tumble his country into the waiting net of China’s goal to one day have Hong Kong, Taiwan and Macau “reunited” formally as part of China. (Hong Kong is chafing against the selection of its leaders by China with massive pro-democracy, answered by pro-Hong Kong government and pro-China demonstrations this year.)
But as for now, Taiwan and Mainland China trade and invest in each other’s businesses on a large scale.
Taiwan is China’s second-largest foreign investor, with, says Ministry of Foreign Affairs’ Manfred Peng, Taiwanese businesses hiring 2 percent of Mainland Chinese workers and with 9 percent of Taiwanese living and doing business in Mainland China.
The two countries delicately skirt the “other” China topic. Often they don’t even use words containing “China” during high diplomatic talks unless their counterpart does. It is a policy of non-utterance to avoid confrontation, in which they agree there is only one China, known as 1992 Consensus, without defining it.
In a press conference with Dr. Chu-chia Lin, deputy minister of the Mainland Affairs Council and a UCLA-trained PhD economist, and his department’s South Carolina-trained researcher, Che-chuan Lee, the questions, and answers, were direct.
Asked if he still sees a terrible threat hanging over him, due to the missiles aimed at Taiwan, at the same time as China and Taiwan are becoming more friendly, Dr. Lee responded: “There are still more than 1,000 ballistic missiles deployed in the southeastern coast. It is very interesting that in recent years, China suggests that since we have much better relations across the strait, maybe we can have some sort of military convention measures or even that we can try to reach some sort of peace deal. But before you revoke and remove the ballistic missiles, it is very hard for us to persuade our people to negotiate with anyone for peace. I think that is still an issue that there is serious concern about. We continue to persuade them to remove the missiles, [or] even if they can, to declare formally [they will] renounce use of force against Taiwan.”
Asked if he’s noticed any change, Dr. Lee said: “I am afraid it is very difficult for the Chinese leader [Xi Jinping] in his early stage of leadership. I think it is difficult for him to renounce use of force or remove those ballistic missiles. So no positive sign on these issues.”
If the Ma government ardently wishes to build Taiwan’s strengths by drawing closer to China as a trading partner, it has not brought all of its people along with it.
The student-led Sunflower Revolution, in March and April, peaking at reportedly 100,000 protesters, marked the first time the Taiwanese legislature had been occupied. The massive student-led protest was joined by thousands of non-students. J. Michael Cole, writing in July, in the Tokyo-based magazine The Diplomat, estimates that up to 54 civic groups and NGOs joined the occupation. It centred on their demand for the government to conduct its promised clause-by-clause review of the controversial Cross-Strait Service Trade Agreement with Mainland China. The government had reneged on that commitment and tried to force the legislation through.
“Riot police resorted to force and water cannons to disperse the protesters, which led to violent clashes and bloodshed with about 110 people injured,” the magazine reported.
After the demonstration, the government promised more transparency through the “Supervision Law.”
The Taipei Times’ protest coverage noted in one poll result, that 80 percent of the 1,087 respondents supported the students’ demonstration. A total of 75 percent wanted the Ma administration to cancel and renegotiate the trade agreement. It opens ownership of some businesses in both countries to the other, a move the Taiwanese protesters fear will lead to a takeover of Taiwan’s small businesses by Mainland China.
The Cross Strait Service Trade Agreement opens 64 sectors, run in Taiwan by mainly small and medium-sized businesses, to China, including those involving national security and free press, such as Taiwan’s telecommunication, print and publishing industries. More than 200 professors and industry representatives warn about freedom-of-speech, national security and economic risks inherent in the agreement.
The government says the protest is likely tied in with Taiwan’s current economic situation: high housing prices, youth unemployment of 13 percent (versus the country’s current average of 3.9 percent) and salaries, to a great extent frozen in Taiwan. A new government program is designed to encourage young people to start up their own businesses.
In a case of duelling polls, Dr. Lin said in June that 60 to 70 percent of Taiwanese surveyed support the agreement. Taiwan and Mainland China have also signed 19 agreements covering a wide array of trade areas, from financial co-operation, joint crime-fighting and industry standards to protect intellectual property and food safety.
Meanwhile, National Taiwan University economics professor Kenneth Lin says a government audit shows the exclusion of products from the trade deal with Mainland China — such as flat-panel displays and automobiles — is partly responsible for some lacklustre trade and employment figures, which he attributes to Mr. Ma’s policy of closer economic ties to Mainland China.
The figures show Taiwan’s exports to Mainland China dropped from US $83.9 billion in 2011 to $80.7 billion in 2012 to $81.7 billion in 2013 and that trade surpluses were, respectively, US$40.3 billion, $39.8 billion and $39.1 billion.
However, the “early harvest” list of 806 products with no tariff showed exports of US $17.9 billion, $18.5 billion and $20.5 billion with surpluses of US $12.9 billion, $13.6 billion and $15.5 billion, respectively.
Despite its recent ups and downs in trade, Taiwan is more than holding its own economically. However, internationally, it has had to mount an unceasing goodwill campaign for representation on the world stage ever since U.S. president Richard Nixon switched the U.S.’s allegiance from Taiwan to China.
The underpinning of that relationship is still a defence policy in the U.S. that officially recognises Mainland China, but has an unofficial relationship with Taiwan. The U.S. supports no push for independence by Taiwan, nor any “changes to the status quo” by either Taiwan or Mainland China. It seeks a peaceful dialogue-based resolution between the two. The U.S. does, however, have a defence pact, including sale of arms to Taiwan. The U.S. will protect Taiwan militarily if China attacks or invades it.
This defence pact only partly offsets widespread regional fear that China will use its military might to settle conflicts over resource-rich and strategically crucial waters of the East and South China Seas. The region is triply rich: in fish stocks, oil and natural gas reserves and strategic sea lanes. By a 2007 estimate, through them pass two-thirds of the world’s liquid natural gas, half the world’s supertanker traffic and 80 percent of crude oil bound for Taiwan, South Korea and Japan.
In a survey the U.S.-based Pew Research Centre recently conducted of 11 Asian countries, respondents from eight described themselves as “very concerned” about armed conflict with China: From 93 percent of Filipinos to 83 to 85 percent of Japanese, Vietnamese and South Koreans. Even 60 percent of people surveyed in China expressed worry.
The flashpoint for several countries is the Japanese-administered Senkaku Islands (called the Diaoyu Islands by the Chinese) in the East China Sea. Both China and Taiwan claim them. China occupies some of the Paracel Islands, which are also claimed by Vietnam and Taiwan. China disputes Japan’s declared boundary in the East China Sea where hydrocarbon exploration and extraction are under way. China has a long dispute with India over large territories, with Bhutan’s claim to its seven regions in its north and west, and with North Korea over river islands.
Most expansively, China lays claim to nearly all of the South China Sea, where Taiwan, Vietnam, the Philippines, Malaysia and Brunei also claim territorial rights. China claims airspace also claimed by South Korea, Japan and Taiwan.
China claims the Scarborough Reef, also claimed by the Philippines and Taiwan, and it claims the Spratly Islands, claimed by Malaysia, the Philippines, Taiwan, Vietnam and Brunei. (China has poured sand onto reefs in the Spratly Islands in apparent preparation for construction.)
Chinese boats have aggressively tailed and raced in front of Philippine boats or halted fishing vessels near the Spratly Islands. The arrival in May of a Chinese oil rig near the Vietnam coast, where Vietnam’s hydrocarbon explorations are under way, set off Vietnamese anti-China rioting that targeted Chinese industries in Vietnam, and mistakenly led attacks on a Taiwanese business.
China backs its territorial claims with an obvious buildup of military muscle. It has 1,600 missiles, “particularly within range of Taiwan,” according to a recent report by U.S. Naval War College associate professor Andrew Erickson and senior RAND Corporation political scientist Michael Chase, published in the U.S. magazine, The National Interest.
China is upgrading the missiles, including the world’s first anti-ship ballistic missile (ASBM). It continues to develop its nuclear forces, say the authors, “with a new mobile intercontinental ballistic missile (ICBM) reportedly capable of carrying multiple independently targetable re-entry vehicles (MIRV) [a multi-warhead ballistic missile with each missile capable of hitting a different target] under development and its first effective nuclear ballistic-missile submarine (SSBN) going on a deterrent patrol this year.”
The People’s Liberation Army Second Artillery Force (PLASAF) is China’s “instrument of deterrence,” in charge of land-based nuclear and non-nuclear ballistic missiles as well as land-based attack cruise missiles. The Ohio-based National Air and Space Intelligence Center, an intelligence arm of the U.S. Air Force analysing foreign air and space weapons capabilities, calls China’s defence program “the world’s most active and diverse ballistic missile development program.”
Given the hostile military neighbourhood and its need for friends and trading partners, Taiwan continues to steadfastly forge international and diplomatic ties.
To date, Taiwan belongs to 33 intergovernmental organisations, including the World Trade Organization, APEC (Asia Pacific Economic Co-operation) and has observer status in 20 others, including the World Health Assembly, which makes decisions for the World Health Organization (WHO), the Organization for Economic Co-operation and Development (OECD) and the Asian Development Bank.
Taiwan has diplomatic relations with nearly two dozen countries and is making inroads into international organisations, having been invited to attend the International Civil Aviation Organization (ICAO) meetings last autumn in Montreal, with the backing of a variety of nations. Other efforts to reach out to the world include the granting of visa-free entry by landing visa to 134 countries and territories.
Taiwan has another recent entry on the international stage — a Taiwan version of the Nobel Prize, called the Tang Prize, which concentrates on modern-day prize categories: sustainable development, biopharmaceutical science, sinology and rule of law. The 2014 sustainable development prize went to Dr. Gro Harlem Brundtland, who served as the first female and youngest prime minister of Norway, and was former head of the Brundtland Commission, which produced the blueprint document “Our Common Future” in 1987 for the UN World Commission on Environment and Development.
Even Taiwan’s architecture aims at international success and world recognition. From 2004 to 2010, the Taipei Financial Centre, known as Taipei 101, was the world’s tallest structure at 509 metres (1,670 feet). It relinquished the title when The Burj Khalifa in Dubai opened in 2010 at 829.8 metres (2,722 feet). Among other symbolisms, Taipei 101 signified that Taiwan’s businesses go that 1 percent better than the perfection of 100 percent — the goal to excel beyond excellence.
Taipei 101’s Japanese-made elevators zoom visitors from the fifth floor to the 360-degree observation tower on the 89th floor in just 37 seconds. It is a thrill ride unto itself.
Some years ago, Mainland China and Taiwan began to resent being played off against each other by countries courting their favour in exchange for financial rewards. The two countries agreed to stop the bidding war that was fuelled by their desire to gain allies — often voting allies in the UN.
Half of the countries in Taiwan’s camp are from Latin America. The large Spanish-speaking contingent of journalists on our tour were led by a Spanish-speaking officer from the Foreign Media Services Section of the Ministry of Foreign Affairs’ International Information Services, Hui-Shuang (Vicky) Li.
(She and Peter Sun, secretary in the same department, expertly speaking English and Spanish, made their way through a packed agenda. It included visits to two ports and the Hiwin Technology Corporation, which manufactures precision parts for, among other things, elevators and industrial robots; Tonglit Logistics, which, besides warehousing thousands of vehicles for shipment, conducts pre-delivery inspections, retrofits vehicles and offers licence certificate authentication; and the fabulous National Palace Museum. We moved up and down the west coast of Taiwan on its smooth high-speed rail system.)
Besides Latin American countries, in Africa, Taiwan’s allies are Burkina Faso, São Tomé and Príncipe and Swaziland. In Central America and the Caribbean, they are Belize, Dominican Republic, El Salvador, Guatemala, Haiti, Honduras, Nicaragua, Panama, Saint Kitts and Nevis, Saint Lucia and Saint Vincent and the Grenadines. In Oceania, they are Kiribati, Marshall Islands, Nauru, Palau, Solomon Islands and Tuvalu. In South America, Paraguay is the sole recogniser of Taiwan. And in Europe, only the Holy See [Vatican] recognises Taiwan diplomatically.
Taiwan seems only too happy to compete within its own borders, though. The charismatic mayor of the west coast port city of Taichung, Dr. Jason Hu, looked at the other port cities and decided Taichung had to carve its own path to prosperity.
“I tried to impress upon investors that I have a very clean, efficient and friendly government and it became the hottest spot for investment in Taiwan,” the mayor reports. His city went from third-largest to second-largest and it is now No. 1 in growth as well as the No. 1 destination for Taiwanese people to live and work. The city’s GDP rose more than 45 percent in five years, producing about 20,000 jobs a year.
He said Taipei is a political and financial business centre. The south has the biggest harbour as well as a petroleum refinery, steel mill and shipbuilding. “I can’t compete with Taipei or Gaochung on those, so I made Taichung into a cultural attraction,” he explains.
He sweet-talked such celebrities as Lady Gaga to perform as “30 million people tuned in from around the world to watch her sing. She didn’t charge me.”
And even Luciano Pavarotti was persuaded by the silver-tongued mayor to sing there. It turned out to be the famed operatic tenor’s very last performance on his farewell tour; he died five months later in Chicago of cancer. Mayor Hu tried to get New York’s iconic Guggenheim Museum to set up an Asia-Pacific branch in Taichung, but Abu Dhabi was chosen. “It’s a pity, because it would have been finished five years ago — even faster.”
“I tried to ask myself, ‘What is the face of my city?’” Against widespread disbelief, he chose culture and now citizens attend at least three cultural events a year. “Culture is like air and water to Taichung residents.” Taichung won the 2007 World’s Best Culture and Art City award.
He sold his citizens on mass transport: The system sees 50 million rides per year. The harbour handles more than 100 million metric tons yearly, including many products such as orchids, tangerines and nano-materials. He built Taiwan’s first ring road and is working on a second one.
Taichung’s key exports are precision machinery, handicrafts and bicycles — “Taichung accounts for about half the world’s bike industry” with Giant, the world’s largest producer of bikes. And there are the very famous Sun Cakes — a flaky pastry whose sales have grown 33 times in 10 years — and a large coffee manufacturing industry.
In terms of luxury products, Taiwan showcases its first whisky distillery — the King Car Kavalan Whisky Distillery — with its international award-winning spirits. Most recently, it won the Pennsylvania-based Whisky Advocate’s World Whisky of the Year Award. Kavalan took top spot in a competition that included historic Scottish single malts and it was named New World Whisky of the Year in The Whisky Bible.
(Kavalan Solist Cask Strength Sherry Cask Single Malt Whisky sells at LCBO’s Vintages in limited supply, for $213.95.)
Kavalan’s distillery draws its processing water from the springs in the Snowy Mountain and Central Mountains in northeast Taiwan. Part of the King Car Group, whose other interests include beverages, food, biotechnology and aquaculture, it is especially famous for its Mr. Brown flavoured coffee products, also sold in Europe. A visit there includes a tour, free liquor samples in an elegant dining room and a retail shop including whiskies and sherries in elegantly branded Kavalan glasses.
And for further luxury, the journalists are given a tour of Jade Shipbuilding in Kaohsiung, Taiwan’s largest private shipyard, where vice-president Memphis Han provides a walk-through of one of its world-famous yachts. Before the Eurozone slowdown, it would have sold for $11 million to $12 million, but could now be had for perhaps $8 million. It features marble floors, wood trim, an inlay of the world map on one bathroom floor and a fully operational communication system.
Mr. Han says the main market is Europe — recent purchasers were from Russia, Spain and Croatia. Jade also builds passenger ferries, bulk carriers and fishing vessels for worldwide customers.
And Taiwan offers simpler pleasures, such as its famed night markets, where everything from shoes to street food is available at all hours of the night.
Says the Mainland Affairs Council’s Dr. Chu-chia Lin: “We have lots of Chinese tourists come to Taiwan and during the night they like to go to the night markets. But after 9 p.m., all of them rush back to the hotel to watch TV because we have lots of political TV shows. They really enjoy watching them. Remember, we don’t have any language problems. So they see how come people in Taiwan can criticise this and that.
“So we could have lots of influence in this aspect. We have strong confidence. We enjoy freedom. They cannot enjoy it. When they come here, they enjoy the free society a lot. We call that soft power.”
Dr. Lin was asked if the cross-strait relationship, which brings with it the possibility of eventual large immigration to the relatively tiny Taiwan via Chinese purchases of Taiwanese businesses, is “a slow, sweet annexation.”
His answer: “People like to use the case of Hong Kong. Last year, around 40 million Chinese tourists went to Hong Kong, whose total population is around seven million. Last year, we had 2.8 million Chinese people come to visit Taiwan, but our population is only 23 million” (or 12 percent of the population.) “As long as we can make sure we can decide our future, and we are a democratic country, so, of course, our people have the right to decide.
“So far, it is too early to have any kind of political talk with Mainland. Taiwanese independence is a very important issue for us.”
As for the possibility that when Taiwan’s integration with China reaches a critical point, there would be no need for a formal takeover by the mainland. He responded with statistics. “In 2007, Mainland accounted for 40 percent of our market. So far, it’s still 40 percent. We know that it is very dangerous if we depend on them too much. So our policy is that we would like to have more trade with Mainland and we would like to have more trade with other countries.
“It is very important for Taiwan to be economically strong and have opportunity. Mainland is becoming more and more powerful, that is for sure. We have to make ourselves stronger so we have a better opportunity to make our own decision.
“We have to make productivity stronger. In the political sense, inside Taiwan, we always claim Taiwan’s future should be decided by her own people. In the future, we would like to claim independence. We can make this decision on our own, but we don’t know how Mainland will react. If we make the decision now, it may be dangerous. OK, everybody knows that.
“But in the future, maybe 20 years or 30 years from now, what will happen, we don’t know. If we cannot make it economically, if our economy becomes more and more weak, if we become more and more dependent on Mainland, in the future, maybe we don’t have any chance to make our own decisions.”
In the meantime, says Manfred Peng, Taiwan’s foreign affairs’ director general of international information services, Taiwan has close ties with the U.S. and Mainland China. It watches Mainland China’s rise and the “increasingly subtle nuances of Washington-Beijing relations,” and sees inevitable “dilemmas” in its external relations.
“In a race against time, Taiwan is using its soft power and a free, democratic and pluralistic way of life to influence Mainland China. We see ourselves as the tugboat leading a container ship into a new harbour,” Mr. Peng says. “Taiwan envisages bolstering Mainland China’s middle class and, along the way, transforming it into a stable, responsible and peaceful country.”

Donna Jacobs is Diplomat’s publisher.

Be Sociable, Share!

Tags: ,

Category: Dispatches

About the Author ()

Donna Jacobs is Diplomat's publisher

Leave a Reply

Your email address will not be published. Required fields are marked *