Beijing’s new Taiwan policies reveal its plans for greater integration

On February 28, the Taiwan Office under China’s State Council published 31 new policies on Taiwan. These include preferential treatment for the island’s firms in investment, technological and cooperative ventures with mainland counterparts, and 19 items to help Taiwanese work, live, study, find jobs and initiate innovative start-ups on the mainland. Moreover, Taiwanese can take a variety of professional and technical exams, while the way has been smoothed for Taiwan’s movie industry to collaborate with its mainland counterpart, encouraging cultural exchanges.

The changes are seen as way to allow businesspeople to grasp new opportunities on the mainland, and could be seen as Beijing’s new engagement policy towards Taiwan, with whom relations have deteriorated under Tsai Ing-wen’s presidency. The policy has significant implications.

First and foremost, President Xi Jinping, who honed his political skills from 1985 to 2002 in Fujian province – which faces Taiwan – is keen to deal with the Taiwan question in the coming years, especially as the constitutional revision to presidential term limits gives him more time to tackle this issue.

Second, the new policy package focuses on economic, cultural and educational realms, laying the foundations for dialogue between Beijing and Taipei on a new economic and cultural union in southern China. Given the mainland’s ongoing plans for the Greater Bay Area, Taiwan will be wooed to join this expanded initiative when the time is ripe.

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In particular, if Beijing and Taipei hit a wall in negotiations over reunification, the thorny issue of politics is likely to be put to one side. Given Xi’s focus on realising the “Chinese dream” and a common destiny, the gesture to Taiwan is clear. In the coming years, once the time is right to resume dialogue – such as after a change of power in Taiwan or a dilution of the Democratic Progressive Party’s hardline stance towards Beijing – an economic and cultural union would become realistic.

Third, with Taiwan’s economy in decline, the island’s businesspeople and pragmatic citizens should become more receptive to these 31 policies. With such economic incentives, more Taiwanese voters are likely to choose a Kuomintang candidate in the 2020 presidential election. Until then, there will be more human and economic interactions between mainlanders and Taiwanese, bringing about a silent shift in the political orientation of Taiwanese voters.

Fourth, China’s united front work focusing on Taiwan’s right-leaning New Party and the KMT has increased. With KMT chairman Wu Den-yih due to visit the mainland later this month for Taiwan forum discussions, the timing of the roll-out of the 31 policies was clearly political. As such, Wu’s visit deserves close attention. If the KMT reacts positively, more voters are likely to favour a pragmatic policy towards the mainland, come December’s local elections, which could see the KMT making a comeback.

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Fifth, Beijing’s Taiwan engagement policy has important implications for Hong Kong. Emphasising a united China and combating pro-independence sentiment in Taiwan, the mainland leadership naturally expects Hong Kong to toe the line, too. As such, under Xi, Hong Kong’s democratic movement will have to be more realistic than ever, understanding Beijing’s bottom line and adapting to the political climate on the mainland, especially as leaders expect the Hong Kong model of “one country, two systems” to operate smoothly, without no detrimental impact on Taiwan.

Sixth, the DPP government in Taiwan is under tremendous pressure to modify or abandon its hardline stance towards the mainland. Premier William Lai Ching-te was once regarded as a “soft-liner”, or dove, with a more positive attitude towards Beijing. If Lai remains pragmatic, his chances of succeeding the unpopular Tsai as the next DPP nominee in the 2020 election will gradually increase. All signs point to a possible shift to a more pragmatic approach in dealing with the mainland.

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Finally, with the Hong Kong-Macau-Zhuhai bridge’s completion, infrastructure development in southern China will reach a new stage. With the implementation of China’s “Belt and Road Initiative”, new infrastructure projects may be considered in the coming years – possibly even a cross-strait tunnel and bridges linking Taiwan and the mainland. At the very least, if the Taiwan-controlled island of Quemoy, also known as Kinmen, is no longer a battleground, a much shorter bridge or tunnel could be a possibility, following the example of Hong Kong and Macau’s infrastructure integration with southern China.

This most significant engagement policy towards Taiwan – a political platform aimed at mainlanders, as well as those in Hong Kong, Macau, Taiwan, and overseas Chinese – was revealed just before the Chinese People’s Political Consultative Conference. While the people of Taiwan have had a mixed response, change is likely to sweep gradually through the island over the coming years. The big question is when leaders from Beijing and Taipei side can meet, start a dialogue and achieve economic and cultural, if not political, breakthroughs.

Sonny Lo is a professor of politics at HKU SPACE