The year began with General Secretary Xi Jinping and President Tsai Ing-wen making major statements that underline the fundamental gap between the Chinese Communist Party (CCP) and Taiwan. In the face of Beijing’s continuing pressure on Taiwan, Washington and Taipei took steps to strengthen relations and celebrate the 40^th anniversary of the Taiwan Relations Act (TRA). In Congress, members proposed new measures, some of which challenge the established framework for US relations with Taiwan and China. Beijing repeatedly protested these efforts and in April sent two PLA fighters deliberately across the midline of the Taiwan Strait for the first time in 20 years in an ill-defined warning. In Taiwan, maneuvering for the 2020 elections has begun creating a confusing situation with unclear implications for cross-strait and US-Taiwan relations.

Tsai and Xi redefine opposing policies

Anticipating that Beijing would make a statement on the 40^th anniversary of the Deng-era Message to Taiwan Compatriots, President Tsai included comments on cross-strait relations in her New Year’s Day address. She called on Beijing to face the reality of the existence of the Republic of China (ROC), to respect its commitment to democracy, and to resume negotiations through authorized entities.

On Jan. 2, President Xi Jinping gave the expected anniversary address.  Although Xi generally repeated well-known policy, his reformulations took a decidedly tougher tone. He stated that the 1992 Consensus means not only that both sides “belong to one China” but also that they “will work together toward national reunification.” Rather than the familiar statement that the 1992 Consensus is the basis for cross-strait relations, Xi stated that Beijing’s “One China Principle is the political basis for cross-strait relations.”   These statements present challenges to Taiwan, particularly to the Kuomintang (KMT), which has framed its policy as having its own and different interpretation of One China. Although Beijing’s “one country, two systems” (1C2S) proposal has long been rejected in Taiwan, Xi reiterated that this formula was the best framework for reunification. Xi went on to call for “democratic consultations” on the “two systems” portion of the formula, as if to underline that Beijing’s view of One China was a settled issue. Taiwan’s political, economic, and social conditions could be accommodated after reunification “provided that China’s sovereignty, security and development interests are ensured.” In tandem with such talks, Xi reiterated that the peaceful development policy to further integrate Taiwan with the mainland economically and socially would continue.

Tsai responded immediately. She explained that she had not accepted the 1992 Consensus because Beijing linked it to the unacceptable “one country, two systems” formula.  She categorically rejected 1C2S and opined that there was a consensus in Taiwan not to accept it. The Taiwan Affairs Office (TAO) promptly criticized Tsai’s remarks as advocating two separate states. The TAO clarified Beijing’s view that the 1992 Consensus and 1C2S were separate concepts.

Xi’s address provoked widespread criticism in Taiwan. The KMT stated that 1C2S was not acceptable to the majority on Taiwan.  Kaohsiung Mayor Han Kuo-yu called for reflection on the gap between Beijing’s resolve to achieve unification and Taiwan’s resolve to preserve its democracy. Former KMT presidential candidate Eric Chu Li-lun reiterated the KMT view of “one China, respective interpretations.” New Power Party (NPP) legislator Huang Kuo-chang likewise rejected 1C2S. Independent Taipei Mayor Ko Wen-je said that 1C2S was not acceptable to people on Taiwan. Polling indicated that President Tsai’s firm rejection of 1C2S had significantly bumped up her low poll approval ratings.

It was expected that Xi would make a statement on this anniversary. But why had he taken a hardline position? Any answer must be speculative. One factor is that the CCP leadership apparently is confident about eventual reunification because of Beijing’s growing military, economic, and diplomatic power. That allows it to take a hard line on unification terms. Another factor is that despite leadership confidence, there are criticisms of the party’s Taiwan policy.  One criticism is that despite Beijing’s efforts, Taiwan is evolving toward what is called “creeping independence.” Xi’s tough line and new proposal for democratic consultations on a two-systems formula can be seen as addressing this concern by defining a way forward toward unification.  Another criticism seen in nationalistic press articles is aggressive talk about the use of force to accomplish unification. Xi’s reaffirmation of the party’s peaceful development approach, buttressed by PLA capabilities, is designed to disavow such talk. In the weeks following Xi’s address, Beijing has continued rhetorical, diplomatic, and military pressures on Taiwan and has begun reaching out to figures in Taiwan to promote the consultations Xi endorsed.

Strengthening US-Taiwan relations

In response to Beijing’s pressures, Washington and Taipei took steps to strengthen their ties, including visits by mid-level US officials.  The State Department deputy assistant secretaries for international organizations and economic policy visited Taiwan for consultations. In March, Sam Brownback, the State Department’s ambassador for religious freedom, visited Taipei to participate in The Civil Society Dialogue on Securing Religious Freedom in the Indo-Pacific. President Tsai participated in this dialogue, and Taipei announced the donation of $1 million to a new fund to assist persecuted religious minorities around the world. The US and Taiwan hosted Global Cooperation and Training Framework (GCTF) conferences on women’s empowerment, health issues, and combating corruption. In March, Japan joined in co-sponsoring one GCTF conference, for the first time. Also in March, the American Institute in Taiwan (AIT) and the Tsai administration announced the establishment of another co-hosted forum, the Indo-Pacific Democratic Governance Consultations, which planned to hold its first meeting in September. In late April, former Health and Human Services Secretary Tom Price attended a GCTF meeting on tuberculosis.

In March, President Tsai visited three Pacific allies Palau, Nauru, and the Marshal Islands. In Palau, US Ambassador Amy Hyatt attended the welcome dinner for Tsai in an indication of US support for Palau’s diplomatic ties with Taipei. Despite PRC criticism, Washington facilitated Tsai’s transit through Hawaii as part of the trip. In a first while on US soil, Tsai, while in Honolulu, participated by video link to a conference hosted by the Heritage Foundation in Washington.

This year, US Navy ships have transited through the Taiwan Straits each month. US military spokespersons have said these transits are designed to show commitment to a Free and Open Indo-Pacific. When a French Navy ship transited the Strait in April, a PRC Ministry of Defense spokesman said the ship had been warned to leave “Chinese waters.”  Although this “Chinese waters” rationale was not published on the official website, the French ship was dis-invited from the PLA Navy’s 70^th anniversary celebration. In April, the State Department notified Congress of a $500 million Foreign Military Sale (FMS) case to continue F-16 pilot training in the US. This was another step toward announcing arms sales in a more routine manner. In March, Taiwan confirmed that it had submitted a request for 66 F-16V aircraft. This and an earlier request for 108 M1A2X tanks are going through a necessary and thorough review. President Tsai has spoken publicly several times about strengthening Taiwan’s defenses and continued visiting military installations to build support and morale for the armed forces. She has also urged acceleration of Taiwan’s indigenous weapons programs, including production of Hsiungfeng-III and Tienkung III missiles.

Both capitals celebrated the 40^th anniversary of the TRA, celebrations used to portray bilateral ties as better than ever. The reaffirmation of the TRA as the framework for US-Taiwan relations was also useful at a time when some have questioned that framework. On April 9, the Center for Strategic and International Studies (CSIS) and other think tanks co-hosted a TRA commemoration conference in Washington. President Tsai addressed the conference by video link. In response to a question, Tsai commented that Beijing’s policy was becoming more coercive and explained Taiwan’s increasing defense effort stating, “We want to deter aggression by showing we are capable of effectively defending ourselves. This is what it will take to maintain peace and stability across the Taiwan Strait.”  Her message was well received in Washington, but condemned by Beijing.

In Taipei, AIT hosted a “TRA@40” reception at its new office complex, attended by President Tsai.

President Tsai speaks at AIT “TRA@40” reception.

Former House Speaker Paul Ryan headed the US delegation to Taipei. Amid press speculation about a Marine Security Detachment at the new complex, AIT stated, without commenting about marines, that US military personnel have been assigned to AIT since 2005. Beijing criticized this saying that sending military personnel to Taiwan was a violation of the three US-China communiqués.

Following adoption of the Taiwan Travel Act (TTA) earlier in 2018 and President Trump’s signing of the Asia Reassurance Initiative Act on Dec. 31, members of Congress continued efforts to demonstrate growing support for Taiwan. To mark the TRA’s 40^th anniversary, Congress passed resolutions renewing support for the Act.  In April, drafts of a Taiwan Assurance Act were introduced in the House and Senate.

Several members also advocated steps that would directly challenge the framework for US-Taiwan relations. Rep. Steven Cabot called for a reassessment of Washington’s one China policy. Rep. Ted Yoho recommended that Vice President Mike Pence should visit Taiwan. Sen. Ted Cruz said President Tsai should be invited to Washington, and six senators wrote to Speaker Nancy Pelosi recommending that Tsai be invited to address a joint session of Congress. These proposals were not based on consultations with Taipei. When asked about Tsai visiting Washington, Foreign Minister Joseph Wu said that it would require further consultation. Later, Wu reported that the subject had not come up when the president and Speaker Pelosi spoke by phone during the Hawaii transit.

Heightened PLA pressure

PLA exercises near Taiwan resumed in December after a six-month hiatus during the local election campaign. Sporadic exercises continued early in 2019. Then on March 31, two PLA J-11 fighter jets intruded across the midline of the Taiwan Strait.

PLA J-11 fighter jet intrudes across the midline of the Taiwan Strait.

The fighters went 43 miles beyond the midline for 11 minutes, prompting Taiwan to scramble fighters in response. This was the first time in 20 years that PLA aircraft had intentionally and provocatively crossed the tacitly observed midline. This seemed to be another military action to convey a political message. However, neither the Ministry of Defense nor Foreign Ministry made any public comment. Only 10 days later did the TAO state that the action was a normal part of the PLA’s annual training plan and that it was the PLA’s sacred duty to protect China’s sovereignty and territorial integrity. In the absence of clarification, it appears the intrusion was a general warning to Taipei and Washington to handle cross-strait relations more carefully.

President Tsai convened a meeting of her national security team. In Washington, the State Department condemned such coercion and urged Beijing to resume dialogue. Three days later, Tsai visited the fighter wing that had responded, commended their action, and used the occasion to carefully call on the armed forces to “forcefully expel” (強勢驅離) any further intrusions. She voiced a morale building 16-character saying, “In defending territory and sovereignty, do not give up an inch; in firmly upholding democracy and freedom, do not retreat.”

Two weeks later, the PLA conducted another significant exercise in the Bashi Strait, south of Taiwan, that involved 24 aircraft, five ships, and simulated operations against Taiwan. The exercise was on April 15, the day of the AIT TRA@40 reception mentioned above. This time the Eastern Theater Command reported the exercise, highlighting some of its threatening aspects and said it was to hone joint operations to defend national territory and sovereignty. This predictable assertion of sovereignty over Taiwan was a direct rejection of Taipei’s consistent demand for the acceptance of the reality of the ROC.

Nomination maneuvering: on the KMT side

These developments in the triangular relations between China, Taiwan, and the US were taking place as Taiwan politicians are preparing for presidential and legislative elections in January 2020.  Although neither of the major parties has set a date for its primary contest, candidates are actively maneuvering for nomination.

About a half dozen personalities have declared themselves as candidates for the KMT primary or are being considered. The range of opinions about cross-strait relations is remarkably broad. Former Party Chairman Chu Li-lun, an early candidate, has chosen to reaffirm the KMT’s past “One China, Respective Interpretations” position and disavowed the idea of a peace agreement. However, current Party Chairman Wu Den-yih, who has made clear he is not a candidate, stated that the KMT would pursue a peace agreement with Beijing if it were returned to power. Han Kuo-yu, the populist mayor of Kaohsiung, who has a lead in the polls, has recently indicated that he would participate in the KMT primary. When Han visited Hong Kong, Macau, and Shenzhen in March to promote Kaohsiung exports, he avoided specifics by calling the 1992 Consensus a “magic wand” for preserving stability. Han has been criticized in Taiwan for meeting privately with the senior CCP representatives in Hong Kong and Macau. Like Han, several other KMT mayors and magistrates have made friendly visits to China focused on economic interests. Former KMT Premier Simon Chang and Taipei’s independent Mayor Ko Wen-je are also considering running as independents.

In late April, Hon Hai Chairman Terry Gou (Kuo Tai-ming) announced his candidacy.

Hon Hai Chairman Terry Gou (Kuo Tai-ming) announces his candidacy.

While Gou is a respected entrepreneur, he has no experience in foreign policy. In his initial public comments, Gou argued for the benefits of cooperating with China, criticized US arms sales, and seemed to devalue Taiwan’s democracy. He has appeared publicly in a distinctive baseball cap and made confrontational statements that seem modeled on Donald Trump’s campaign playbook. Gou’s personal wealth and his extensive investments in China will be both assets and liabilities for his political prospects. Many suspect that his extensive ties in the mainland will skew his policy toward China and make him vulnerable to political pressure. As if to confirm this, the CCP-controlled Global Times commented that Gou’s elections would likely reduce cross-strait tension.

The CCP is reaching out to KMT mayors and magistrates and, in line with Xi’s Jan. 2 address, urging them to endorse the 1992 Consensus without mentioning “respective interpretations.” As mentioned, several of the recently elected local officials and other party leaders have visited. Party Chairman Wu has long wanted to visit, and the Tsai administration has said he would be free to visit after his three-year travel ban on former officials ends May 20. In contrast to their relatively good relations on the mainland, none of the KMT’s potential candidates has well-established ties in Washington, though Gou touts his personal relationship with President Trump.  Chu, Han, and Ko have each made trips to the US this year, but only Ko visited Washington.  Whoever becomes the nominee will undoubtedly visit Washington this fall. The array of KMT candidates, with differing policy perspectives, paints a confusing picture and creates uncertainty about future cross-strait and U.S.-Taiwan relations.

KMT Chairman Wu’s talk about a peace agreement has reignited a controversial issue.  It led the DPP to state that passing legislation concerning cross-strait political agreements will be a high priority in the Legislative Yuan (LY) this year. The Tsai administration has sent the LY draft legislation on political agreements that sets such a high bar that it is unlikely a negotiation of a political agreement could ever be authorized, let alone negotiated and approved. The LY has decided that this draft and five others will be sent for inter-party consultations.

On the DPP side

The situation within the DPP is also uncertain. When Tsai’s response to Xi’s address boosted her approval rating in January, it seemed her path to renomination had been cleared. However, In March, former Premier Lai Ching-te announced his intention to run. Lai apparently believes opinion polls that show he has a better chance of winning than Tsai. As his action threatens DPP unity, party elders, most of whom favor Tsai, are seeking to persuade him to reconsider. To allow more time, Party Chairman Cho Jung-tai has postponed the DPP presidential primary.

Lai’s candidacy has raised concerns in Beijing and questions in Washington. While his underlying goals are similar to Tsai’s, Lai has been much more explicit about independence, repeatedly describing himself as a pragmatic political worker for Taiwan independence. Shortly after resigning as premier, Lai appeared at an event sponsored by the fringe Taiwan Constitution Association and declared that now is the time for a new constitution that better reflects Taiwan’s status as an independent state. Such statements have won Lai the backing of pro-independence elements, to whom Lai will be beholden should he win the nomination. The TAO criticized Lai by name saying his advocacy of a new constitution constituted promotion of de jure independence and would push Taiwan to the brink of an abyss. Chinese academics perceive Lai as even more dangerous than Tsai.

Washington has been careful to stay out of internal politics. AIT Chairman James Moriarty has said the US interest is in a free and fair process and that Washington will work with whoever is elected. James Heller, the State Department’s director for Taiwan coordination, and Moriarty have repeated the well-known US position that it does not support independence. In addition, in response to the Formosa Alliance’s promotion of a referendum on independence, the AIT spokesman has twice stated that the US does not support a referendum on independence, citing Washington’s abiding interest in peace and stability.

Resisting CCP interference in Taiwan

The coming election campaign has again focused attention on CCP efforts to influence Taiwan politics and elections. Tsai has expressed concern about how Beijing will manipulate social media and disseminate misinformation (fake news) to interfere in the coming campaign. DPP legislator Hsiao Bi-khim has described CCP methods including: 1) influencing traditional media owned by Taiwan firms that have extensive mainland investments and actively promote Beijing’s views, 2) using content farms to flood social media with misinformation and play up divisive local issues, 3) influencing grassroots and religious organizations the CCP has cultivated and supported, and 4) indirectly funding pro-unification political groups. CCP social media operations are becoming increasingly sophisticated and now work through Taiwanese they have hired to post their messages. Tsai has portrayed Taiwan as on the frontline of the CCP’s global united front and cyber warfare operations and called for international cooperation against these activities. AIT Chairman Moriarty has said the US and Taiwan as democracies face similar challenges from foreign interference.

The Tsai administration has focused on improving various agencies’ ability to rapidly counter misinformation about the government. The National Communication Commission (NCC) is beginning to use its regulatory powers to discipline media that fail to fact check their reporting. In April, NCC Chairperson Nicole Chan resigned after criticism of the NCC’s inadequate efforts against misinformation. The Tsai administration is seeking cooperation from local social media platforms, from Facebook and from the Japan-based Line platform to rapidly remove misinformation originating from Chinese URLs. Taipei has encouraged independent civil society groups to monitor influence operation and worked to heighten the public’s media literacy including through programs co-sponsored by AIT. Minister without Portfolio Audrey Tang visited Washington in April to consult with the State Department’s Global Engagement Center (GEC) on how to respond to similar challenges to democratic institutions.  On a related move, The Taiwan Internet Network Information Center shut down a Taiwan-based website that had been created to promote the TAO’s “31 incentive measures.”

Other developments

The African Swine Fever (ASF) epidemic in China has continued to spread through 30 of 31 provincial-level units and has reached Vietnam and Cambodia. Since December, Taiwan has taken drastic measures to prevent ASF spreading to Taiwan and damaging its important pork industry. Beijing continues to rebuff Taiwan’s request for timely information, asserting that Taipei can get the information from the Organization for Animal Health (OIE).  Meanwhile, several infected pig carcasses have washed up on beaches in Kinmen, presumably from China. In April, the OIE convened an Asia-wide meeting in Beijing on the ASF epidemic. However, due to pressure from Beijing, Taiwan, an OIE member, was not invited to the meeting. Beijing’s unwillingness to help Taiwan prevent ASF’s spread to Taiwan is an unfortunate example of how Beijing’s rigid political attitude continues to belie its assertion that the people on both sides of the strait are “one family.”

Taiwan’s exclusion from the ASF meeting was but one example of Beijing’s relentless effort to isolate Taiwan internationally. In February, Taiwan was not able to attend the semi-annual World Health Organization meeting on the Asian Flu Vaccine, as it had done previously. The WHO invitation did not reach Taipei until the morning of the day the meeting opened in Beijing, too late to arrange for the delegation’s visas.  It is also clear that Beijing will again block Taiwan’s participation as an observer in the World Health Assembly this May.

Taipei continues working to stabilize ties with its allies, and the US is doing more to assist. For example, National Security Council Director for Asia Mathew Pottinger and Taiwan Vice Foreign Minister Hsu Szu-chien met in the Solomon Islands in March. In April, Deputy Assistant Secretary Cindy Kierscht met publicly in Port au Prince, with Taiwan’s Ambassador Hu Cheng-hao to promote US-Taiwan cooperation on sustainable development in Haiti. These are examples of a new pattern of the US and Taiwan cooperating with host governments on useful projects, which also help stabilize Taiwan’s relations with allies.

The disruptions caused by US-China trade frictions continue to affect Taiwan and Taiwan investors in China (Taishang). There is anecdotal evidence that Taishang are hedging by diversifying some operations to Southeast Asia and in some cases back to Taiwan. All Taishang in China have been concerned about how the new PRC Individual Income Tax Law, that became effective Jan. 1, will affect their tax status. In March, Premier Li Keqiang said that Beijing continues to support investment from Taiwan and that special benefits for Taiwan investment would continue under the new law. The TAO has said that the tax law implementing regulations would include benefits for Taishang and stated that the new PRC residence cards for Taiwanese was a separate issue from their tax status.  Zhang Zhijun, the chairman of the Association for Relations Across the Taiwan Strait (ARATS), has commented that investments from Taiwan would be treated as “special internal investments,” though without explaining what that means.

President Xi’s reaffirmation of the 1C2S formula has again focused attention in Taiwan on how that formula is being applied in Hong Kong. The Hong Kong Special Administration Region’s plan to amend the Hong Kong extradition law to allow deportation to China has raised concerns, such as that critics of the CCP from Taiwan who visit Hong Kong could be seized and deported to China. In April, Hong Kong bookseller Lam Wing Kee, who is known for publishing books critical of Chinese leaders, fled to Taiwan, reportedly to avoid the possibility of deportation after the law is adopted. Hong Kong’s proposed National Anthem Law has been criticized as yet another limitation on the freedom of expression promised under 1C2S.  The stiff penalties imposed on participants in the 2014 Umbrella Movement were also criticized in Taiwan.  These and other Hong Kong developments only reinforce opposition to 1C2S in Taiwan.

Looking ahead

The Taiwan campaign period will be a particularly sensitive time. Once Taiwan’s main parties have nominated their presidential candidates this summer, the shape of the campaign will become clearer. The cross-strait policies of the candidates should indicate what role cross-strait political and economic issues will play in the campaign. Attention will remain focused on how the CCP is influencing the election. The expected conclusion of a US-China trade agreement will bring some clarity on the trade front and may create circumstances in which the Trump administration could address trade issues with Taiwan.