In Taiwan’s high stakes elections, China is the loser

Taiwan’s election results are in, and voters chose Lai Chiang te in a three way race as the candidate who best represented what they’re looking for in a leader — that is, the status quo. Lai, the current vice president and head of the ruling Democratic Progressive Party, declared victory Saturday with , crowding out his opponents, Hou Yu ih of the Kuomintang (KMT) and Ko Wen je of the Taiwan People’s Party.

It’s the first time in Taiwan’s — and Lai has repeatedly told voters he’ll preserve outgoing President Tsai Ing wen’s to preserve Taiwan’s democratic system and its sovereignty. While we don’t know what ’s response will be or when it will happen, there is expectation among some China experts that it will be “assertive”.

Though Taiwanese voters have a variety of concerns — including economic and social priorities — the primary question in a presidential election is how each candidate will manage relations with China, which claims Taiwan as its own. Though Lai is not specifically calling for independence from the mainland, both his predecessor’s stance and some of his past comments in favor of independence have gotten him branded a “troublemaker” by Beijing.

The Chinese Communist Party has harbored the hope that Taiwan, where the nationalist , would unify with the mainland and accept CCP rule. Lai’s win means that goal — at least by peaceful means, under the island’s own volition — is still quite far away, if it is to happen at all. During Tsai’s eight year tenure, Taiwan asserted its independence from the mainland by strengthening its relationship with the US, to the ire of Chinese President Xi Jinping.

Though the US was already Taiwan’s main security partner, more symbolic acts like former Speaker of the House Nancy Pelosi’s visit to the island in 2022 and infuriated Beijing, which performed military drills in Taiwan’s vicinity and enacted punitive diplomatic measures. Though China has not yet responded to Lai’s win, Beijing has said that the election was illegitimate, given that it sees Taiwan as part of the mainland.

China also attempted to , the KMT candidate, which it sees as more deferential to the mainland. Lai won with only 40 percent of the vote, and , indicating that voters feel some measure of frustration, likely regarding social issues like the and high cost of living. Still, “I think the main headline is continuity over change,” Andrew Scobell, a distinguished fellow with the China program at the US Institute of Peace, told Vox.

Tsai’s tenure saw the loss of some of the island’s diplomatic allies — countries that had ties with Taipei rather than Beijing. Her 2023 trip to the Americas included stops not only in Washington, but in Latin American countries like Guatemala, too, in an attempt to protect those relationships from Beijing’s economic diplomacy.

That policy has drawn Costa Rica, Panama, the Dominican Republic, El Salvador, and Nicaragua into . China has often engaged in economic coercion in some form or another, whether it’s to , or to tacitly control important infrastructure in . Efforts to turn Taiwan’s remaining diplomatic allies are likely to continue under Lai — but so are Taiwan’s efforts to cultivate powerful friends.

Taiwan under Tsai shored up its relationship with the United States, as well as creating closer ties with Japan and European nations; all three candidates emphasized the importance of the US Taiwan relationship, with little daylight on their foreign policy. Where Lai broke away with his competitors, and particularly Hou, was in his framing of Friday’s election as a choice “between democracy and autocracy,” as David Sacks, a fellow for Asia studies at the Council on Foreign Relations said .

All the candidates indicated that they would continue Taiwan’s defense partnership with the US and would would increase the island’s defense budget, which currently stands at $19.1 billion, or 2.6 percent of GDP, indicating, as Sacks said, broad agreement that relying on dialogue with Beijing or Xi’s “goodwill” isn’t enough to keep China from trying to take the island by force.

While Lai signaled that he’ll raise that percentage, it’s not yet clear by how much. “The Tsai administration has gotten much more serious about how Taiwan can best defend itself against China,” Scobell said. “They’re grappling with, ‘How do we stop China from landing on Taiwan?’ But if they end up getting there, thinking of how Taiwan can resist.” That’s not to say that cross strait dialogue is out of the question under Lai, Sacks said.

“It’s certainly not like he doesn’t want dialogue with Beijing, he said that the door is open and he’s willing to talk on an equal footing.” However, “I don’t think it’s unfair to say that his top priority is really strengthening ties to the United States, Japan, and other democracies.

And cross strait communication is something that’s nice to have, but not something that you must have.” The economy and cost of living are also important to Taiwanese voters, though perhaps less so than the existential threat of war or takeover by China. Taiwan is dealing with a serious real estate crunch, as Margaret Lewis, a law professor at Seton Hall who focuses on human rights in China and Taiwan, told Wednesday’s panel.

“Younger voters [are] more concerned about things like the price of housing,” Lewis said. “It’s very expensive to buy housing. So there’s talk about sort of preferential loans to first time homebuyers, especially under a certain age.” Lai has pledged to increase the number of affordable housing units under the plan outlined by Tsai, as well as building new housing units and encouraging further participation in a government sponsored subsidy program for landlords, according to .

Another problem is Taiwan’s sluggish economy; wages have failed to increase with the cost of living, and China’s economic retribution — and in an effort to both punish Taiwan and encourage residents to favor more dialogue and cooperation with the mainland — is likely to continue after Lai’s win.

Taiwan must also diversify its economy away from its focus on semiconductors, of which it is the world’s largest manufacturer. As Vox’s wrote earlier this month: “The world’s reliance on these chips is so great that it has sometimes been called Taiwan’s ‘silicon shield.’ The idea is that the global economy, very much including China itself, is simply too reliant on Taiwan made semiconductors to risk any action that might take the supply offline.

But as the invasion of Ukraine has shown, countries can be willing to incur severe economic costs to accomplish what they see as major geopolitical goals — and reunification is about as fundamental as it gets for China.” Ultimately, the economy is not just a domestic issue but a foreign policy and cross strait issue, too — which points back to relations with China as Taiwan’s main concern.

And Lai’s democratic and sovereignty bonafides are certain to garner an angry response from China, on multiple fronts. Though Scobell predicts an “assertive response” to Lai’s win on Beijing’s side, he said it’s likely to happen in the coming weeks or months, not in the next few days. “We’re going to see a reaction from China; the question is, when and how,” Scobell said.

“Whereas five, 10, 15 years ago, it was fairly predictable — the kinds of things that Beijing would do. But I think it’s increasingly difficult to predict what is going to happen and when it’s likely to happen.”.