There are more reasons for Taiwan's economic failures

Comments on J Bruce Jacobs "Taiwan’s democracy grows stronger as KMT falters", 7/01/2016

In the second last paragraph, it is stated: “President Ma’s China plans have fallen apart. His Economic Cooperation Framework Agreement, signed with China in 2010, has not produced the forecast economic prosperity.”

What are the main reasons for this failure of producing the forecast economic prosperity? Do they have anything to do with the slowing Chinese economy and difficulties/challenges international economies have faced?

Realistically, would Taiwan be better off or worse off economically when it have a better relationship with China, given the size and its regional and international role of Chinese economy?

Dilemma for Taiwan's next president choice

Comments on Peter Drysdale "Taiwan’s political choice", 12/01/2016

From the following statement from this post, it seems to be indeed a real irony purely from the point of view of Taiwan’s economy: 

‘In fact, the profound political shift in Taiwan is more closely associated with the economy’s failing struggle to re-invent itself. With per capita income around US$22,000, Taiwan is above the middle income threshold, but it has been unable to emulate its neighbours like South Korea and Japan in Asia in climbing up the income scale. Its export-dependent manufacturing sector faces competition from South Korea from above and emerging economies, like China, from below. GDP grew a measly 1 per cent in 2014; wages are stagnating and unemployment, at 4 per cent, is considered high. The irony is that Taiwan’s tortured, ‘one-sided’ economic relationship with China — which Ma had been trying to correct — might well be a core element in Taiwan’s economic woes. While direct trade has opened up across the Strait, Taiwan has continued to restrict Chinese imports and investment, essential to enjoying the fruits of fuller integration into the regional and global economy. South Korea has imposed no similar burdens on its international competitiveness.’

Is the restriction on Chinese imports and investment and its impact on its international competitiveness the key factor to Taiwan’s economic stagnation in the past up to now? If it is, then the expected new president will face a serious dilemma: accountable to an electorate that may like to see a more distant relationship with the mainland, and to develop strategies to kick start the economy where a distant relationship may work in an opposite way.

Yes, it is possible to diversify its economic relationship, but it will take time to achieve. More fundamentally, defying an inherent international comparative advantages under the current circumstances is likely for Taiwan to continue to pay a price.

Paris strategy shows way for China and Taiwan

Comments on Sheryn Lee "Troubled times ahead for Taiwan?" 15/12/2015

It is a very difficult issue to manage the relationship between China and Taiwan.

However, the Paris agreement on climate change out of COP21 shows that difficult challenges can be tackled with creative thinking and approaches. Nearly 200 countries came together and agreed on the agreement, although I have not read the text of the agreement.

Given the historical and current realities across the Taiwan Strait as well as the reform process of the mainland China, some kind of federation with high autonomy may be possible to satisfy both sides.

Voting in Taiwan

Comments on Sheryn Lee "Taiwan: voting for stable relations with China?" 10 June 2015

A question on economic dependency: what are the criteria for assessing whether Taiwan’s dependency on the mainland is healthy or otherwise? I am not sure whether the perception of excessive dependency is justified or not. No matter whether it is justified or not, it seems there is a need to adopt or develop objective criteria to use in such tasks.

Given that China is undertaking many reforms, both China (the mainland) and Taiwan should study what will be the best structure between the two under unification. Deng Xiaoping seemed to have a different structure from that of Hong Kong in mind. People now should be able to further develop Deng’s idea creatively.

A new and special structure for the unification of the Taiwan Strait

Comments on Bonnie S. Glaser and Brittany Billingsley “US, China await Taiwan elections with apprehension”, 23/12/2011 http://www.eastasiaforum.org/2011/12/23/us-china-await-taiwan-elections-with-apprehension/

In the short to media term, the stability in the relation cross the Taiwan strait will be good for every party involved, including both sides of the strait, the US, as well as the DPP.
In the long term, it would be conceivable to establish a new special structure for the eventual political unification of the two sides of the strait.
Deng Xioping was said to have stated that a structure more loose than the "one country, two systems" structure that has been applied to both Honk Kong and Macao, including Taiwan has its own military system etc.

I personally think that a special political name for reference to Taiwan, such as Taiwan特州(洲)(special state), to differentiate from the “Special Administration Region” used for both Honk Kong and Macao.

In China's long history, there were periods when 州 was used as a region within China, so the use of this Chinese character may be acceptable to the Chinese, especially as a compromise between the two sides of the Taiwan Strait. 洲 could also be used, given that Taiwan is an big island, surrounded by water, hence the left part of the character.

If such a political structure or system were to be adopted, China would have several different special regions, including Taiwan as the most special one, then Hong Kong and Macao, then minority ethnic autonomous regions, special directly administered municipalities, beside the many provinces.

As long as Taiwan is unified with the mainland and both work for win-win outcome to benefit both, then Taiwan can be expected to have much broader international space.

The new economic agreement between China and Taiwan

Comments on Stuart Harris “Taiwan and its new economic agreement with China”, 9/07/2010, http://www.eastasiaforum.org/2010/07/09/taiwan-and-its-new-economic-agreement-with-china/
The majority of Taiwanese are likely to weigh up the agreement with alternatives and see whether the agreement is in their interests.

As the shift of world economic weight towards Asia continues and China’s economic size becomes bigger and bigger and further integrated with regional economies, such agreement is likely to be more and more important for Taiwan.

As Harris mentioned, this agreement can not only diminish the potential disadvantage to Taiwan in an expanding Asian market by the regional economic integration underway through the expansion of preferential trade arrangements from which Taiwan would be excluded, but also bring further significant economic benefits to Taiwan to the tune of 4.5% of GDP.

A cooperative economic relationship will be better for both sides.

From political point of view, I think China is likely to adopt a very generous attitude toward Taiwan as long as the two sides maintain a reasonable relationship and no serious separation is contemplated.

China has enough internal ethnic issues, problems and tensions to attend and the resolutions to those internal ethnic issues are likely to contribute to a better relation with Taiwan.

Given that some options to allow Taiwan have its own troops and system were floated by high level Chinese leaders in the past, it is likely that some sort of federation might be possible.

Maybe a first step is to have a peace agreement between the two sides. Then they could discuss a new constitution for a new federation.

Difficulties for Taiwan's DDP under new environment

Comments on Peter Yuan Cai “Taiwan: The Democratic Progress Party’s ‘China Syndrome’”, 23/09/2009, http://www.eastasiaforum.org/2009/09/23/taiwan-the-democratic-progress-partys-china-syndrome/

The new approach by mainland China, if it is maintained for the foreseeable future, is likely to have profound implications for the politics in Taiwan.

In this new environment, the Democratic Progressive Party (DPP) in Taiwan will find it difficult to be relevant unless it makes relevant policy changes.

When China and Taiwan are further integrated practically day by day, the future of the two sides is likely to have a looser union than the model for both Hong Kong and Macau, possibly using the model of a federation, with much higher autonomy for Taiwan, including all its own affairs including internal security and many external presentation within the framework of a new federation.

What will be role in that framework for DDP? It is unclear, because its basis has been for independence.