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A Matter of Survival: How the Trade War will Shape China’s Future

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By Francesca Ghiretti and Lloyd Yijue Liu

2 May 2019

The trade war between the US and China is just the tip of the iceberg of deeper differences that will have complex ramifications (Manufacturing.net)

 

The trade war between the US and China is more than what meets the eye, and this is not a mystery. In fact, besides the trade deficit, there are multiple aspects at stake: intellectual property rights, the opening of the Chinese market and most of all, the political-economic system of China. The economic aspects appear to be laden with heavy political values for both actors. For Trump the trade war is a political means aimed at reinvigorating his political message with the eye on re-election, while for Xi Jinping it is a matter of survival, both his and that of the Communist Party of China (CPC).

Although negotiations are ongoing, the deeper political issues on the table risk triggering a mutation of the trade war. During the current state of affairs, an open armed conflict is highly unlikely. However, it is probable that the conflict between China and the US may spread to other countries and areas of interest, thus creating a complex matrix of entangled elements. The fight for technological advancement appears to be the most notorious battlefield, leading many to believe that in the near future the trade war could take on the shape of a technology war. The case of Huawei and the debate on AI are only two early examples of what such a conflict might look like. One wonders: why technology? Technological advancement is fundamental for the survival of the American primacy in the world and of the CPC in China. Both powers are aware that those who will lead the technological revolution that is unfolding under our eyes will lead the world in the coming years. After all, Britain would have hardly had the capacity to build an empire without the advantage of the first industrial revolution, and the West would have looked very differently and occuped a very different global position were it not for the industrial (and technological) revolutions.

Thus, both China and the US interpret the ongoing power struggle as a matter of survival, and technological development appears to be the main arena in which the battle is fought. In the long-run, instances for the US and China to face each other and present their contrasting models will not be lacking in number. However, in the short term, an agreement might be reached. It is for this reason that we propose three different scenarios each consisting of a possible outcome of the current negotiations between the two countries. In scenario one, an agreement is reached, and all tariffs are dropped. Scenario two describes the current situation– a state of limbo where some tariffs are in place but there is still space for communication and for a sudden turn in any direction. In the third scenario the US and China are unable to get a significant deal, leading to the prolonging and worsening of hostilities.

There is a perceivable division between the motives of President Donald Trump and those of the American strategists. The former needs a victory in view of the upcoming elections, even more so following the failure of the negotiations with North Korea. American strategists, on the other hand, appear to be seeking a more radical change in China’s way of doing business. Trump’s goal is to obtain an agreement which has the aspect of a victory for the US, with China expected to open its market to more American investments and firms, protect intellectual property and balance the trade deficit. Such objective seeks only a superficial change which would mean sizeable but not system-changing concessions by China.

The adoption of a Foreign Investment Law by China and the reform of the law on Intellectual Property suggests China’s propension to implement a few changes in order to find an agreement with the US, at least formally. On the other hand, the broader aims of the strategists seek deeper changes which ultimately would strip the CPC of its absolute centrality. This might be a real deal-breaker, should they be seriously pursued. In fact, Xi understands the importance of achieving an agreement for the sake of the Chinese economy. However, the survival of the CPC and its control over the entire Chinese society will always remain the first priority. All in all, what is to be expected is a temporary deal where China makes some quantitatively significant concessions but leaves structural changes to an unknown future.

Scenario 1. Trade deal (Tariffs at 0%)

In the first scenario the trade war ends with the US and China reaching an agreement which leads to the abolition of all the tariffs. However, this scenario envisages not a peace treaty but a regulated and extended truce. The deeper issue however, the nature of the Chinse political system, will not have been resolved. The basis of the Chinese government’s actions lays firmly with the doctrine of the ‘party leads everything’ (党是领导一切的) and is expected to remain. Here, the CPC would keep on centrally managing all aspects of China’s life, including areas which in the West are usually private or independent, such as academia and the judiciary. If the US is seeking a change in such approach, this issue is destined to come to the surface again at some point in the future and spur a conflict between the two.

In the short run, however, China will certainly be more collaborative with the US and the West. This would not mean a return to Deng Xiaoping’s ‘hide and bide’ paradigm, but a purely rhetorical switch to a more low-key and friendly campaign to present the ‘rise of China’ to the world, while creating more skillful ways of attracting foreign talent and importing technology and know-how from developed countries to develop China itself. Moreover, forging new strategic partnerships in the Western sphere would be easier with the blessing of the US and China’s renewed collaborative attitude.

Scenario 2. Further extending the deadline for a deal (Tariffs at 10%)

Currently, we are likely to be living the last moments of this transition scenario, which is probably advantaging China more than the US. The longer the negotiation lasts, the more uncertainty to the global economy and pressure on Trump’s credentials it will bring. The CPC is not immune to the political repercussions of a slowing economy, but unlike Trump, Xi does not have to face elections in a few months. Were it not for these looming elections, Trump too would have highly benefitted from a longer period for negotiations, as it would have allowed him to test whether China’s promises turned into reality. In such a scenario, a full-fledged deal (Scenario 1) would still be on the table, but China would have time to consider and perhaps test other alternatives. To force the Americans to reach a suboptimal deal and to protect their own economy from future repercussions, the Chinese might try to intensify their transactions with other trading partners. They might also try to explore possible fractures between the US and its allies, such as the EU, while exploiting the disruption of the global supply chain of goods manufactured in the country, such as tech components, to increase the pressure on the reaching of a deal and preparing for more negative alternative scenarios.

Scenario 3. No deal (Tariffs at 25%)

This is not the most likely outcome. However, with Trump and Xi, two stubborn leaders leading the discussions, this option cannot be ruled out. In this case, China and the US would become more assertive in implementing their own plans and fulfilling their geopolitical interests. Thus, multiple actors and areas of interests, such as technology, geopolitical claims and multilateral settings, would be involved in the disputes which is likely to take place simultaneously in different arenas, an example of which was the run for technological advancement previously mentioned. If the conflict becomes further politicised; China will make it difficult for the US to reach its goals in any international issues which China has influence on (such as in North Korea, the South China Sea or instances presented to the UN Security Council). At the same time, China would actively strengthen its already existing alliances, seek new allies and leverage any possible dispute between the US and its allies.

At home, the CPC would further devalue the Renminbi (RMB) to maintain China’s competitive edge while promoting stronger nationalism. In fact, it is believed that after 1979, the way in which the CPC maintained the level of legitimacy it needed to govern has slowly shifted from a nationalistic rhetoric to a more pragmatic promise of future wealth for Chinese people. Now that growth is slowing, and the West is becoming more hostile to China’s economic power, the CPC is attempting to transform the public’s economic grievances into a nationalistic feeling of an imminent external threats, which would grant the Party more space of maneuver. Interestingly, although often thought otherwise, it has been shown that the younger generations are at the same time materialistic and nationalistic, the use of an emergency rhetoric might override their materialistic need and help them endure economic difficulty in time of perceived external threats.

Regardless of the outcome of the trade war, the Chinese government could use its tax policy and the control of property price to encourage consumer spending. Furthermore, the CPC is likely to implement more large-scale infrastructure construction projects to keep the economy running in an attempt to mitigate the impact of the trade war and the slowing economy. An excellent example of this is the outcome of the recent Belt and Road Forum where China has strongly reaffirmed its commitment to the realisation of the project, robustly responding to the increasing skepticism towards the feasibility of the Belt and Road Initiative (BRI). In China, more openness of the market has oftne been followed by a tightening effort for societal control to avoid a Soviet-style system collapse, this is likely to remain the case in the foreseeable future. Abroad, as in Scenario 2, China would seek new allies. However, according to the outcome of the trade war, the degree of assertiveness used by China to pursue such goal will change.

In conclusion, none of the scenarios presented rules out a future clash between the US and China, as the power struggle between the two will endure even after reaching a potential agreement. Their embodiment of different, and in certain aspects antithetical, models of governance and development will impede the complete appeasement between the two, leaving the world politics and economy in an uncertain state of affairs. In the long-run, this is likely to end with a drastic change in one of the two actors and the subsequent victory of one and loss of the other.

Francesca Ghiretti is a doctoral candidate at department of War Studies and European and International Relations at King’s College London where she has been awarded the Leverhulme scholarship ‘Interrogating Visions of a Post-Western World: Interdisciplinary and Inter regional Perspectives on the Future in a Changing International Order’. The focus of her thesis is the political response of the EU to Chinese foreign direct investments. Follow her @Fraghiretti.

Lloyd Yijue Liu is currently working as a research assistant for the China part of the research project Mapping Elite Networks and Governance in the 21st Century at the Department of Political Science at VU University of Amsterdam. He holds an advanced master’s degree in International Relations and Diplomacy from Leiden University and previously studied History and Modern European Studies at the University of British Columbia.

Professor Kerry Brown on the rise of Xi Jinping: Power and politics in modern China

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Interview with Professor Kerry Brown conducted by Lauren Dickey

18th_National_Congress_of_the_Communist_Party_of_China
18th National Congress of the Communist Party of China. Source: Wikimedia

Lauren Dickey: What made you write `CEO China: The Rise of Xi Jinping’?

Kerry Brown: This is the second in a trilogy of books on power and politics in contemporary China. The first book, `The New Emperors: Power and the Princelings in China’, which came out in 2014, was simply about the leadership succession between Hu Jintao who was leader of the Chinese Communist Party from 2002 to 2012, and his replacement, Xi Jinping, and then the group of leaders around Xi who had risen to power at the same time. In that book I was trying to map out the dynamic way in which networking occurs in elite politics in China and, in a sense, trying to get as far from possible away from the notion of factionalism and the sort of neat boundaries that sometimes gives to analysis of Chinese elite politics. This second book looks very closely at Xi himself. During the past four years of his presidential tenure, which constitutes a third of his time in office, we have now had time to see the kind of leader he has become and are approaching something of a record in power. So we should now start to have a good idea of what he wants from power, how he is exercising it, and what sort of China he is trying to bring about. The third book, to be published next year, deals with China’s role in the world under Xi.

Does anything about Xi and what he has done since 2012 surprise you?

I guess the ways in which he has been able to accrue power and be so visible and dominant have been a surprise. Most analysts would agree that Xi sounds and looks like he is in charge in ways that his two immediate predecessors, Jiang Zemin and Hu Jintao, never really did. Xi speaks and acts like he knows what he is doing, he has a grand vision and he is willing to push people to achieve that. The real signature feature of his period in office, the anti-corruption struggle, has also been deeper and more extensive than previous similar inner party purges. It was a real surprise for instance, that he did allow for former Politburo Standing Committee member Zhou Yongkang to be formally indicted, expelled from the Party and then imprisoned in 2014. This had never happened before at this level. Though what we also have to remember are the first words he said when he emerged as Party Secretary after the Congress in November 2012. He gave a list of issues he wanted to address including the distance between the Party and the people, the level of greed and larceny in society etc.. So in a sense, we shouldn’t be surprised; he has done what he said he would do. It shows politics in China is the same as everywhere else. The most unsettling and shocking thing politicians can do is to actually carry out what they promised when they were lobbying for power! We usually expect the opposite.

Is Xi `the new Mao Zedong’?

It is popular at the moment to say that Xi is a Maoist. Yu Jie, the U.S.-based dissident journalist, wrote a book in 2014 simply calling Xi `China’s godfather’ and arguing that given their experience of the 1966 Cultural Revolution, Xi and other leaders of his generation only understand the politics pertaining to class struggle and Maoist-style worship of contradictions. It is understandable that a Chinese leader would seek to draw at least some legitimacy from being linked to the founding father of the regime, who remains an admired figure in China. However, the Mao Zedong of contemporary China is the same as it has always been – the Mao that died in 1976. There is no point of anyone trying to emulate or replace him. I think what Xi has done, is to try and affirm that there is a definite link between China before and after 1978 when ‘Reform and Opening-Up’ is usually said to have started. Were Xi to try to deny this linkage and say there was a complete difference between China before and after 1978, that would really create ideological and political issues, because it would imply that everything from 1949 to 1978 was a mistake, including the unification of 1949 and the industrial modernization facilitated by the USSR in the 1950s. Xi has therefore gone out of his way to stress that they are two periods of the same project, the same set of aspirations, both focused in different ways on trying to achieve China’s modernization. Xi himself has said that without Mao, there would be no modern China. So don’t expect this group of leaders to turn their backs on Chairman Mao, nor to stop dropping him into their speeches and activities when they get the chance.

Do you think that Xi is an autocrat?

Xi looks and sounds powerful, and as I explain in the book, there are ways in which he certainly does have significant influence. But power is a dispersed thing, even in the People’s Republic, where so much seems to come down to the aspirations and ambitions of the Communist Party. The Party itself is a complex entity now, its membership much more diverse than in the period of Mao or even of Deng. It is like a state within a state, and we underestimate its internal potential divisions and fragmentation at our peril. I would argue that it is the Party, not Xi, who is the autocrat as, in some ways, it is Xi’s key mandate to make China’s one party rule sustainable; he is the servant of that mission, not the architect of it. Additionally, a lot of the policies his government is pursuing were already clear before Xi’s rise to power in 2012. The internal cleansing of cadres and the rectification of their behaviour through the anti-corruption struggle, for instance, was already prefigured in the appointment of Wang Qishan as head of the graft-busting body in early 2012. Even in the era of Hu Jintao and the years of massive, double digit growth when everything the Party touched seemed to turn to gold, there was a sense that the larceny, greed and unruliness of party officials was becoming a serious threat to the Party’s long term stability. I think that under Xi we are seeing an attempt to make it more efficient as a political force, and restore at least some of its moral mandate. I do not believe that Xi could exercise the kind of all-embracing rule that Mao did. That was for another age, and another time. Xi has tactically chosen certain areas, and seeks dominance in them. Only in that sense is he Maoist – a master of guerilla warfare by stealth and concealment!

What are the most important challenges for Xi’s China?

This is a treacherous period for China’s development. I think this was known some time ago. The transition to middle income status for any country is a tricky one, and almost always is attended by thorny political reform issues, not just economic ones. So since 2012 the main issue has been moving away from investment and manufacturing more towards a consumption, service sector led model. The issue with China is that this needs to be done at a scale and speed, which is unprecedented. Many things could go wrong. Unlocking what Premier Li Keqiang calls the `inner sources of growth’ within, rather than outside China is a major part of what the country is now trying to do. But the idea introduced in 2013 at the annual Plenum meeting that China now embraced full marketisation has, so far, been only partially achieved. Xi’s China is trying to create this unique partly socialist, partly capitalist model, unlike any we have seen before. The current consensus is that to really develop further, it will need to introduce stronger rule of law, greater accountability by the government, and political competition – i.e. multi-party entities, public participation in decision-making, and having the Party relinquish some of its privileged status in society. These are precisely the things that Xi and the leadership around him have said they will not countenance. Perhaps they will in the event of a crisis where the choice will be between the Party falling or it maintaining some form of negotiated power. This is the question no one really knows the answer to at the moment – just how pragmatic the Party will be when some kind of crunch comes. Historically, taking the hard line and never compromising, for instance during the Tiananmen Massacre of 1989, fulfilled its objectives and meant that the Party never had to cede space to organized political competition. However, that tactic won’t work forever. In the next few years, therefore, we will see the Communist Party of China rewrite the laws of modernity, and either be a one Party developed state with the world’s largest economy, or suffer the sort of challenges that the USSR and others did. We will just have to wait and see.

 

 

Lauren is a first year PhD researcher in War Studies at King’s College London and the National University of Singapore. Her research explores Chinese President Xi Jinping’s strategy toward Taiwan with an update of classical deterrence theory. Beyond cross-strait relations, she is also interested in Chinese foreign and defense policy and East Asian security issues. She is a fluent Mandarin speaker and a member of the Pacific Forum Young Leaders program at the Center for Strategic and International Studies. Prior to King’s, she was a research associate at the Council on Foreign Relations in Washington, DC. You can follow her on Twitter @lfdickey.

Kerry Brown is Professor of Chinese Studies and Director of the Lau China Institute at King’s College, London. Previously, he was the Professor of Chinese Politics and Director of the China Studies Centre at the University of Sydney. He led the Europe China Research and Advice Network (ECRAN) funded by the European Union from 2011 to 2014. Professor Brown is also presently an Associate Fellow on the Asia Programme at Chatham House in London. His main interests are in the politics and society of modern China, in its international relations and its political economy.

Despite a Historic Summit, Cross-Strait Relations Faces the ‘Certainty of Uncertainty’

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By: Jeroen Gelsing

Ma Xi Grin2
Ma’s grin belies a fraught reality. Source: AFP/Roslan Rahman

On November 7, the world’s press thronged into the Island Ballroom of Singapore’s Shangri-La Hotel. The occasion marked a historic meeting between the leaders of the Chinese Communist Party (CCP) and the Kuomintang (KMT) - erstwhile foes in the Chinese Civil War, which reached its present stalemate with the KMT retreat to the island fortress of Taiwan.

Today, sixty-six years on, a mutual cordiality prevails that, until the inauguration of Taiwanese president Ma Ying-jeou in 2008, had been unthinkable. Nonetheless, such cross-strait congeniality may prove evanescent. Rising from Ma’s China engagement policy, he has become increasingly unpopular at home. Indeed, in defiance of Ma’s broad, toothy grin throughout his lengthy 80-second handshake with Chinese president Xi Jinping, the future of cross-strait relations is fraught with uncertainty.

As is often written, Beijing regards Taiwan as a renegade province; a breakaway territory listed for recovery as China fulfills the manifest destiny of rounding out its Qing Dynasty borders. The biggest threat to the CCP’s undertaking, Beijing warns, are the ‘splittist’ forces across the Taiwan Strait - a pejorative phrase rather effective at delegitimising Taiwanese aspirations to arbitrate their island’s own future, be it as a part of China, an independent country, or in some form of compromise solution.

Playing Beijing’s cherished ethnicity card, Xi proclaimed in his summit speech that ‘blood is thicker than water’, referring to the common Han Chinese bond of people on either side of the Taiwan Strait. This asserts the naturalness of subsuming Taiwan into a pan-Chinese nation, a view strongly supported by his domestic audience. Indeed, a fiercely nationalistic education system emphasises historic grievances, yielding a younger Chinese population that overwhelmingly supports their government’s position on China’s various territorial disputes.

Things are a little different across the Taiwan Strait. Unlike Xi, Ma travelled to Singapore as the beleaguered leader of 23 million Taiwanese - unpopular, ironically, partially because of his accommodating cross-strait policy that helped to engineer the historic summit in the first place. Under this approach, Ma has negotiated economic integration with China that has nonetheless not revivified Taiwan’s economy, as Ma originally claimed it would. Far from experiencing an economic boom, fragile growth and a loss of regional competitiveness are putting downwards pressure on the island’s economic prospects.[1]

In tandem, Taiwanese fret over the geopolitical consequences of the Ma administration’s cross-strait economic integration strategy. Increasingly, this approach is felt to be jeopardising the island’s de facto sovereignty - some 85-90% of Taiwanese indicate determination to preserve this status quo. As such, the confluence of economic disillusionment and sovereignty concerns after seven years of cross-strait rapprochement have left Ma impressively unpopular, even if under his guiding hand an unparalleled tranquillity has descended over the Taiwan Strait.

The November 7 Ma-Xi meeting came with little warning, announced only on November 3. Whatever the precise motivations behind this short notice, it conveniently denied Taiwan’s domestic opposition, both political-institutional and, as will be discussed below, within civil society, the opportunity to raise concerns regarding the meeting’s timing, which comes just several months ahead of Taiwan’s January 2016 national elections.

That such considerations may have prevailed in the KMT camp underlines the extent of public discontent with Ma’s vision for Taiwan’s future as it has unfolded over the past seven years. Yet, a broad cross-strait cooperation and integration strategy initially enjoyed at least tacit approval of the electoral majority. In 2008, Ma was first elected on a platform aimed at reviving Taiwan’s flagging economy, oriented particularly at developing closer economic relations with China. First and foremost, the Ma campaign claimed the elimination of cross-strait trade barriers would directly aid GDP growth. Secondly, it anticipated that a Taiwanese demonstration of goodwill would gain Beijing’s reciprocation and lift crippling restrictions against the island’s international space that serve to hamstring Taiwan’s export-oriented economy.

However, fast-forward seven years, and only part of this platform has been realised. The 2010 Taiwan-China Economic Cooperation Framework Agreement (ECFA) cut tariffs and commercial barriers on cross-strait trade, which climbed to nearly 200 billion USD in 2014. Yet this trade volume increase did not herald the expected prosperity for Taiwan. To the contrary, while benefitting the operations of large corporations, ECFA has squeezed medium and small businesses, and given rise to the widespread perception that ECFA has made life harder for farmers, fishermen, blue-collar workers, and even white-collar workers, rather than easier. Indeed, over 85% of Taiwanese voice pessimism over their country’s economic trajectory.

Further, Taiwan’s anticipated greater international space has not materialised. Beijing still blocks Taiwan’s ascension to regional political forums, such as ASEAN, and prevents its participation in trade blocs rising up throughout Asia, such as the TPP (Trans-Pacific Partnership), which Taiwan is eager to join, and similarly, the Regional Comprehensive Economic Partnership (RCEP). Equally, Beijing’s political clout makes impossible the conclusion of bilateral FTA’s - token ones with Singapore and New Zealand excepted, which comprise but a small portion of Taiwan’s foreign trade. Because of this diplo-economic isolation, the island is losing valuable competitive ground to direct competitor South Korea, which has forged trade agreements with the European Union and ASEAN, among others. Thus, Taiwan’s gamble to brave closer integration with China has not reduced sovereignty risk, but rather furthered it, while also not resulting in commensurate economic compensation to warrant this danger. For this, too, the Ma administration is held accountable.

Such grievances are exacerbated by disillusionment over the Ma administration’s lack of transparency in conducting cross-strait negotiations. Indeed, the unsupervised backdoor character of KMT-CCP talks has further fuelled fears that Ma is not adequately protecting Taiwan’s de facto sovereignty. Such concerns, rightful or not, reached a boiling point in March 2014, when the student-led Sunflower Movement prevented the ratification of ECFA’s follow-up service trade agreement. Taken in sum, the aforementioned factors have halted further cross-strait integration along the Ma administration’s blueprint.

Mistrust of Ma’s charted course for the island’s future is mirrored in Taiwanese identity trends. Presently, KMT-CCP cooperation is premised on the so-called ‘One China Principle’, which, despite critical interpretative differences, holds that both Taiwan and the mainland are part of a single ‘China’.[2] However, given the expanding contingent of islanders who consider their nationality to be Taiwanese - to say nothing about ethnicity - this is fast becoming a precariously narrow basis for conduct of political negotiations with China. Instead, a clear majority of the Taiwanese population prefers - if the circumstances permit - a cross-strait framework that explicitly recognises Taiwanese sovereignty, or at least acknowledges the existence of a self-governing entity on either side of the Taiwan Strait. Thus, Ma’s direction of and foundation for cross-strait cooperation are increasingly at odds with Taiwan’s identity trends.

Underpinning this sense of distinctness from China is over a century of geographical separation and independent development. Time and distance have made Taiwan and China very different places. Having experienced its ‘economic miracle’ in the second half of the twentieth century, Taiwan is a developed nation with living standards rivalling those of Japan and South Korea. While China, as a developing country, struggles with the extension of social security under its troubled hukou-system, Taiwan’s national healthcare, for instance, is high-performing and often lauded. And critically, Taiwan’s democratic political system contrasts sharply with China’s authoritarianism – a distinction that resonates strongly in Taiwan. Altogether, Taiwanese are keenly aware that the products of their own politico-economic history are, in fact, accomplishments to protect, and that closeness with China is likely to jeopardise rather than preserve these achievements. Thus, to invert Xi’s November 7 comment: for many Taiwanese water trumps blood – a sentiment not easily overruled by Chinese statements of ethnic unity.

These deep-societal identity trends, backed by a profound sense of alternate development and independent accomplishments, are merging with the aforementioned diplo-economic frustrations in the run-up to the presidential and legislative elections scheduled for January 2016. KMT candidate Eric Chu trails opposition Democratic Progressive Party (DPP) candidate Tsai Ying-wen by as many as 20 percentage points. Tsai is widely considered a shoo-in for the presidential office. In fact, KMT weakness is such that the opposition may also gain a legislative majority – unprecedented in Taiwanese history.

This would certainly make China nervous, as it would grant the DPP the power to make constitutional changes to the status quo. It is, however, not expected to do so. Nonetheless, the likelihood of cross-strait instability remains even in the absence of a legislative majority, if only for the fact that the DPP’s explicit objective to, at a minimum, preserve Taiwan’s de facto independence clashes with China’s long-term vision of the island’s recovery (or annexation, depending on your viewpoint). Indeed, the DPP rejects the One China Principle as a valid basis for cross-strait relations.

The KMT has frequently criticised Tsai for failing to develop an alternate framework for cross-strait conduct, sounding her out on offering few specifics beyond a basic commitment to preserve the status quo. Regardless, Taiwanese now appear sufficiently disenchanted with the Ma administration that they are prepared, unlike in 2012 presidential elections where Tsai ran unsuccessfully, to embrace the ‘certainty of uncertainty’. Indeed, in recognition of this possibility, China has already warned of a ‘tidal wave’ if the One China Principle is not upheld. Whatever the case, Tsai’s election will necessitate both sides to establish a new cross-strait modus operandi, and the present cordiality in Taiwan-China could thereby well be ruptured.

For Ma personally, the November 7 Shangri-La summit crowned seven years of careful cross-strait politicking, securing a tête-à-tête that had been unthinkable in 2008. However, unlike Xi, Ma attended the Shangri-La meeting as a head of state strongly criticised at home. The broad grin that paired his historic handshake with Xi, then, felt somewhat pyrrhic – the road to this smile coming at the expense of a divorce from the Taiwanese body politic. Through the Singapore summit, the CCP has tried to lock the DPP into the One-China framework, and convince the world that its approach to cross-strait relations is paying dividends. However, the summit may prove a transient high-water mark, with both the CCP and KMT recognising that under a DPP president more attuned to Taiwanese societal trends, waves - tidal or not - are to be expected.

Jeroen Gelsing is a doctoral student in War Studies at King’s College London. His research interests converge on the Asia Pacific and include the region’s international security dynamics, geopolitics, and modern history. His work has appeared in Asian Affairs, International Affairs Forum, and the Daily Telegraph, among others.

Notes:

[1] While the domestic structural problems of stagnating wages, labour market rigidity, and rising real estate prices command much discontent of their own, these problems are exacerbated by the feedback loop that exists between cross-strait policy and Taiwan’s overall economic position.

[2] Specifically, the KMT utilises the tenuous construct of the 1992 Consensus as its foundation for cross-strait negotiations with China. Under the 1992 Consensus both KMT and CCP agree that there exists only one China, while both sides disagree on the party – KMT or CCP – that is the sole legitimate representative of this one China. Taiwan’s main opposition party rejects this 1992 Consensus. Note also that China’s 2005 ‘Anti-Secession Law’ directed at Taiwan does not permit any political party on Taiwan to declare de jure independence, else it provoke ‘non-peaceful means’ of intervention by Beijing.