Monday, January 31, 2011

Can withering Taiwan engage Asean?

The mood in Taipei today is of concerns and anxieties. Why? The Taiwanese lai bai xing (commoners) feel quiet strongly the soon-to-be the world's largest economy would eventually usurp up their island, known as Taiwan.

Indeed, some of them even concurred that growing economic dependency on the mainland is a kiss of death, which they cannot avoid. Tourists, brides, students, agricultural and manufactured products and huge capital are pouring across the Taiwan Straits all at once. China's purchasing power has undeniably pumped up Taiwan's economy.

Talking to these people on downtown streets yielded a deep sense of indignant. Those live in the more prosperous north prefer Taiwan that can engage without upset the mainland all the time. While their fellow citizens in southern part in the south exhibit fiercer desire for independence. They love to challenge Beijing's authorities from time to time. This prevailing mixed sentiment will determine whether the current leader, President Ma Yingjeou, will have another shot at his presidency when a general election is due next year.

The mood was a stark different from the second term of ex-president Chen Suibien a few years back. At the time, the Taiwanese government was a bit gung ho and was very vocal against the mainlanders, bolstered by strong Washington's backing under the Bush administration. Before Ma came to power in 2008, contacts at all levels between the peoples across the straits were moderate. Since then, there have been unprecedented economic cooperation and other forms of exchanges. The Economic Cooperation Framework Agreement (ECFA), effective this month, is considered the zenith of their bilateral cooperation.

While Taiwan continues to register high economic growth around eight per cent last year, the dividend of new openness with China has not yet filtered down to the lao bai xing's level. They opined that the increased trade flows and tariff reductions just benefit only big corporations with strong links with the government and the ruling party, Kuomingtang (KMT).

Of late, media reports and analysis acknowledged that the uneven distribution of income is a cause of great concern for the Ma government, which can in turn block the KMT's return to power if it is not seriously addressed. The outcome of November's municipality election also showed that the KMT was losing its magic, which bought them to power with a landside. Now, President Ma's popularity has fallen to 30 per cent level, as his government was further beset by corruption charges as well as the impacts of sloppy managements of natural disasters in late 2009, which continues to raise the public angst.

Interestingly, Taiwan seriously hopes to use deeper and broader ties with China to lure in Asean members. The ECFA with China, which is likely to include social and cultural matters in the future, Taipei hopes, would be extended to the grouping. Taipei officials are confident that the current China-Taiwan friendship would make the members less recalcitrant to augment economic cooperation with the island, especially in the area of trade and investment. So far, only Singapore has taken up the challenge by holding talks with Taiwan to conclude a similar agreement. The Philippines and Malaysia are also pursuing the same path. Thailand was also approached but the Thai officials were not in the mood.

Since its departure from the United Nations over three decades ago, Taiwan has witnessed their relations with Asean gradually slipping away. Instead the island looks towards the US and Japan as its main allies. Although Taiwanese investments are far larger than the mainland within the region, one-China policy impeded further contacts and prospects for expansion. For instance, the island's plan to become a dialogue partner of Asean since the middle of 1990's has been repeatedly rejected by Asean albeit with huge economic tolls. However, the last two decades also saw the rapid strengthening of all around Asean-China relations, which served as an automatic breaker for Taiwan's diplomatic assertiveness.

Asean members such as Indonesia, Philippines and Vietnam understand the benefits of closer ties with Taiwan would bring even though it could raise eyebrows in Beijing. Quite successfully, they have attracted in their own ways the island's direct investment and increased labor quotas. At present, Indonesia has the largest number of workers of nearly 150,000 working in Taiwan. In the past few years, Vietnam has become the No. 1 investment destination for Taiwanese businessmen and the number of Vietnamese workers now ranks No. 2, just a few ten thousands less than Indonesians.

Thailand, which has faithfully pursued the one China policy, has lost out to both countries. On the surface, political uncertainties in Thailand has been the major attribute for the decline of Thailand-Taiwan ties. At a deeper level, there were not sufficient dialogues between the two governments. Successive Thai governments have expressed disdains whenever there were contact initiatives from Taiwan.

Throughout the 1990's, Thailand was the main recipient of Taiwan's largest direct investment, which reached over 10 billion dollars accumulatively last year.

Throughout the past decade, over one hundreds thousands of Thai construction workers went to the island annually. For a record, the famous Taipei101 Tower, the world's second tallest building, was built by the blood, sweats and tears of Thai workers.
Internationally, Taiwan's diplomatic space has expanded a bit due to China's confidence and acquiescence. Question remains whether the island can expand its ties with Asean under the current circumstance. The Nation, Bangkok

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