For almost a decade, Beijing has pursued a “soft” approach to Taiwan, cultivating economic ties and political exchanges. While the effort has produced significant benefits for Taiwan in terms of increased immediate security and trade, Beijing has not abandoned its pursuit of re-unification. Following the end of President Chen Shui-bian’s term in office, which was marked by constant tensions and several crises with the mainland, Beijing has helped his successor, Ma Ying-jeou to pursue a policy of economic integration with the mainland.
During his second term, however, efforts to use ties with President Ma to bring Taiwan farther into PRC orbit have backfired, resulting in a weakened presidency that cannot deliver the mainland’s goals. Thus, Beijing appears to be looking ahead to next two elections, trying to make as much progress as possible before Ma leaves office, while simultaneously trying to establish ties with possible successors.
Sources of Chinese Influence in Taiwan
Beginning with the administration of Hu Jintao, the PRC has eschewed the threat of force and placed greater emphasis on other means. Hu’s strategy was put forth in a major policy speech in December 2008, which provides guiding principles to promote the normalization of overall cross-strait relations. The speech outlined a six-point program, including the “One China” principle; strengthening economic ties; fostering cross-strait spiritual links and personal visits; expanding Taiwan’s “reasonable” participation in international organization; and ending cross-strait hostility and concluding a peace agreement, objectives also advocated by President Ma. 
On the top of the publicized program, Hu is said to have confided to his inner circles that it is both easier and less expensive to “buy” Taiwan than to conquer the island (Formosa Weekly #82, January 2011). Beijing’s implementation of this strategy has employed both economic means and a united front operation to make inroads among corporate leaders, ruling and opposition parties, the media and the public.
In 2009, China and Taiwan signed an Economic Cooperation Framework Agreement (ECFA), including 18 specific agreements, to normalize economic relations and liberalize Taiwan’s trade and investment relations with China. There are now 670 cross-strait flights weekly, and Taiwan’s sight-seeing sites are now crowded with mainland tourists—2.8 million visited Taiwan during 2013 (Taiwan Tourism Bureau, < admin.taiwan.net.tw >.
PRC municipal and provincial procurement missions have been dispatched to southern Taiwan, the political stronghold of the opposition Democratic Progressive Party (DPP), to buy fruits, vegetables, milk, fish and other local products (Taiwan Mainland Affairs Council). The mainland is overwhelmingly Taiwan’s largest export market, consuming more than 40 percent of all Taiwanese exports. President Ma believes that closer economic ties with China will invigorate Taiwan’s struggling economy and stabilize cross-strait relations, but Beijing does not offer a free lunch. Chinese leaders’ ultimate goal is unification—ECFA, for example, is modeled on China’s special economic arrangement (CEPA) with Hong Kong, a Special Administrative Region since 1997.
Ties with Business Elites
Reinforcing this gradual shift toward Beijing are ties with Taiwan’s large enterprises and business leaders, who have benefited from the liberalization of cross-strait trade and investment made possible by the ECFA. Moreover, Beijing has utilized economic for a, such as the Bao-Ao Forum and Nanjing Forum, to reach out to and co-opt Taiwan’s business elite.
Most of the business elite have become staunch supporters of cross-strait rapprochement. During Taiwan’s presidential and parliamentary elections in 2012, for example, quite a few Taiwan business tycoons campaigned for President Ma’s reelection, and tens of thousands of Taiwanese businessmen chartered special flights to return to Taiwan to cast their votes, presumably for Ma and the parliamentary candidates of his party, the Kuomintang (KMT).
United Front Work
As part of Beijing’s political, information and united front operations in Taiwan, Taiwanese merchants sympathetic to China have acquired major Taiwanese newspapers and TV stations (including the China Times, Want Daily, CTV and CTi TV, all owned by the WantWant Group) (Taipei Times, September 10, 2009). Beijing now can influence these media outlets, and others that have received Chinese funding, to propagate politically “correct” information. Thus, when Chen Guanzheng, a Chinese human right lawyer, made a week-long trip to Taiwan in June 2013, local media gave little attention to his visit and activities. At the same time, a large entourage of foreign reporters followed him and covered his trip. 
For some time, President Ma has been angling for a trip to China to attend the Asia Pacific Economic Cooperation (APEC) summit in Beijing in October 2014, and for what would be a historic meeting with Chinese President Xi Jinping. So far, President Ma and his two predecessors have been barred from the APEC leaders’ annual summit due to objections from the PRC. Although cross-strait ties have improved dramatically since Ma took office in 2008, most Taiwan analysts think a China trip and meeting with Xi unlikely for Ma, as both sides are still far apart on sovereignty and several other key political issues. (Taipei Times, January 12).
Responses from Beijing, however, leave room for an about-face if certain demands are met. Beijing has hinted that “right” conditions must exist beforehand. Ma has already taken steps in what appears to be an effort to meet Beijing’s demands. For example, he dispatched former KMT Chairman Wu Po-hsiung to Beijing in June to deliver the message that he accepts the “One China framework” (Taipei Times, June 12, 2013). In his October 10 National Day speech, Ma also proclaimed that Taiwan–China relations are not international relations (China Times [Taiwan], Taipei Times, October 11, 2013).
Xi’s Demands Push Ma into a Corner
Xi Jinping, who succeeded Hu Jintao as China’s top Party and state leader in November 2012 and March 2013, has continued Hu’s overall approach toward Taiwan, but he has been pushing harder and faster to implement Beijing’s policy agenda on Taiwan.  Xi has placed Ma in a difficult position, repeatedly forcing him to choose between the demands of Beijing and of the Taiwanese public—and his attempts to navigate these demands have contributed to declining poll numbers and a widespread perception that he is a “lame duck” president.
In the political sphere, Beijing is exerting immense pressure on the Ma regime to move toward a cross-strait political dialogue that will lead into a peace agreement. President Ma has so far stuck to a formula of “economics first, politics later,” limiting cross-strait interaction to economic relations. At the Bao-Ao Forum in early April 2012, Vice President-elect Wu Tung-yi stated flatly that the time was not yet suitable and three conditions must be met before the cross-strait political dialogue can be held: The two sides must accumulate sufficient sincerity and good will; establish a stronger and more solid domestic consensus within Taiwan; and there must be clear public support (China Times, April 3, 2012).
In remarks widely interpreted as evincing impatience with Ma’s refusal to engage in cross-strait political dialogue, Xi Jinping reportedly told President Ma’s special envoy to the APEC, former Vice-President Vincent Siew, on October 6, 2013 that “The issue of the political divide that exists between the two sides must step by step reach a final resolution and it cannot be passed on from generation to generation” (China Times, October 7, 2013).
“Peace Forum” Sidelined the KMT
Beijing does not take no for an answer, and has been doing what it can to pressure, push and prod Ma’s regime to change course. Beijing invited several non-KMT think tanks, chief among them the 21st Century Foundation and the pro-independence Taiwan Braintrust, to Shanghai to attend the newly-inaugurated “Peace Forum.” However, the forum was boycotted by research organizations affiliated with the KMT and the government. According to media reports, the Shanghai Peace Forum was unable to reach consensus on key issues, as the participants of different political beliefs expressed divergent views on future political relations between Taiwan and China (Chinanews.com, October 12, 2013; BBC Chinese service, October 13, 2013).
Nonetheless, the participants agreed to hold the Forum again in Taiwan in 2014, which would allow Beijing to get more non-KMT groups involved and to put the issues of cross-strait political relations directly to the Taiwanese people, going around the Ma government.
Ramming Through the Services Trade Agreement: A Political Fiasco
In the economic arena, Beijing was hoping to move further toward cross-strait economic integration in 2013 by concluding first a trade service agreement, then a commodities trade agreement and other agreements on banking and financial cooperation. Taiwan’s Strait Exchange Foundation Chairman Lin Join-sane initialed the Service Trade Agreement (STA) in Shanghai in June, but its ratification has been blocked by Taiwan’s Legislative Yuan (LY), causing much displeasure in Beijing.
From Beijing’s perspective, the STA is also intended to perform vital political and united front functions in Taiwan. As shown by the experience of Hong Kong, the STA will provide legal cover for China’s agents to live and work throughout Taiwan. Through Chinese enterprises and shops, China’s operatives will be able to use the STA to continue to build up resources and capabilities to influence Taiwan’s political process and strive for peaceful unification.
Beijing was in a hurry to get Taiwan to approve the STA, and made several attempts to lobby the LY. It conveyed its “concern” to Speaker Wang Jin-pyng through an intermediary, but Wang was unable or refused to railroad the ratification of the STA. Likewise many Taiwanese merchants in China were also instructed to visit and put pressure on the LY members of their constituencies, but to no avail. Ma attributed the delay to Speaker Wang, and believed that a new speaker would be able to engineer a speedy and smooth passage of the STA and other pending cross-strait bills. From September, Ma sought to strip Wang of his KMT membership to remove his speakership (see China Brief¸ October 10, 2013).
The campaign to purge Wang backfired badly, although it alone does not account for Ma’s political troubles: he has also had to contend with failure to deliver on several major campaign promises in his first term; political fallout from fuel and electricity price hikes and a new capital gains tax on stock transactions; and his own abrasive leadership style. Ma is faced with record-low approval ratings at 9.2 percent and growing criticism within the KMT (Eranews TV, January 17). Although two more years remain in his term, he is already widely seen as a lame duck president.
Beijing Seeking Alternatives to a Weakened Ma?
With the seven-in-one municipal and local elections to be held in December 2014 and the presidential/parliamentary elections in 2016, many KMT leaders—and Beijing—are apprehensive that voters could reject KMT candidates in 2014 and vote the KMT out of national government in 2016. Beijing has much at stake, and appears to be seeking alternatives to the Ma government.
Most significantly, Beijing is attempting to hand-pick a candidate to run for the mayor’s office in Taipei. Sean Lien has formidable credentials: he is quite popular in Taipei and enjoys the support of pro-Beijing media, leading the polls before officially announcing his candidacy (China Times Weekly, November 22, 2013). Lien comes from a wealthy and well-connected family, and is the son of ex-KMT chairman Chan Lien, who is Beijing’s principal interlocutor in Taiwan and enjoys Beijing’s confidence, having met several times with Hu Jintao. Moreover, Xi Jinping has met Sean Lien and appears to be fond of him, joking about his height during a meeting at the Great Hall of the People (Tung-shen TTV news, February 25, 2013). As mayor of Taiwan’s capital, Sean Lien would provide Beijing not only a direct link to the KMT leadership, but also a strategic power base to counter-balance President Ma (and post-Ma leaders).
Overtures to the DPP
Another measure is to manipulate the selection of the mayoral candidate of the DPP and the opposition camp. Beijing and pro-Beijing media appear to have endorsed Dr. Ko Wen-je, a famed physician and an independent candidate, who leads most opinion polls, but has been accused of soliciting Beijing’s support during trips to the mainland, including visits to Mao Zedong’s former base at Yen’an, a sacred site for the Communist Party (Taipei Times, December 16, 2013).
At the same time, Beijing has also cultivated links with the higher echelons of the DPP. Frank Hsieh, once a Prime Minister and DPP Chairman, was the most prominent DPP figure ever to visit China in 2013, and Beijing also is reported to have sought a visit from Tsai Ing-wen, a former chair of the DPP and presidential candidate in 2012.
In short, Beijing’s strategy toward Taiwan under Chairman Xi Jinping and his predecessor Hu Jintao has yielded positive results. The approach not only avoids possible military conflict with the United States, but receives support from Washington.
As the preceding pages have shown, Beijing’s economic means, such as the ECFA, have enhanced Taiwan’s economic integration with China and greatly increased the PRC’s control over Taiwan’s economy and society, helping to lock Taiwan into the mainland’s orbit. Likewise, Beijing has developed tools that allow it to intervene directly in Taiwanese domestic politics.
In 2012, Beijing’s intervention assisted the reelection of President Ma. It is sure to try again in Taipei’s mayoral election in 2014 and the presidential/parliamentary elections in 2016.
- Full text of Hu’s six points: < http://news.sina.com.cn/c/2008-12-31/132716956875.shtml >
- LY Speaker Wang Jin-pyng was scheduled to receive Mr. and Mrs. Chen at his office, but he cancelled the appointment after he received a message from Beijing to “do a favor” to the Chinese leadership (author’s conversation with Sen-Hong Yang, Chairman of Taiwan Association for China Human Rights).
- This is surmised from an October 2012 article in the party journal Qiu Shi in by Wang Yi, former Director of the CCP Central Committee Taiwan Affair Office and presently Minister of Foreign Affairs, in which he extolled five major achievements of Beijing’s policy toward Taiwan on the eve of the 18th CCP Congress (China Times [Taipei], October 17, 2012).