The island nation has been showing its East Asian neighbors the advantages of democracy and free markets.
As the coronavirus wreaks political and economic havoc on the nations of East Asia, one has stood out as a literal island of responsibility and efficiency: Taiwan. Its public-health response is being held up as a global model — only one death and fewer than 100 cases, so far — which is remarkable given that China has blocked it from membership in the World Health Organization.
The government also was quick to recognize the scale of the potential economic disruption, rolling out a $2 billion financial support plan a month ago.
A major question is what effect the virus will have on President Tsai Ing-wen’s signature regional initiative, the New Southbound Policy. She hopes her landslide re-election in January will give new momentum to her simple, smart plan: taking Taiwan’s dynamic growth engine and using it to build links across the western Pacific for economic prosperity and as a bulwark against Beijing’s aspirations for regional dominance.
From its strategic location at the northern entrance to South China Sea, Taiwan setting a course southward into disputed waters. What should the U.S. be doing to help fill its sails?
When I visited Taiwan just over a year ago, I had a chance to meet the president and her national security adviser. In her crisp, fluent English she quickly sketched out the details: Directly invest in nearby countries in the range of $2 to $3 billion annually; increase the number of business and tourism visitors into Taiwan by 5% to 10% a year; and improve the impression neighbors have in the “ease of doing business category.”
The plan puts a priority on ties to Singapore, a fiercely independent tech hub, and Vietnam, with its fast-rising population and expectations for an economic boom as it makes a full transition to a market economy. The Taiwanese have also made gains courting the Philippines, and have long-range aspirations of stronger economic relations with Malaysia and Indonesia at the far end of the South China Sea.
Success of the New Southbound Policy not only enhances the Taiwanese economy, but strengthens regional views of the island as a strong democracy and a willing diplomatic and security partner. And while these nations will be to varying degrees economically dependent on China — and, of course, none recognize Taiwan as an independent nation — they view a close relationship with Taiwan as a kind of subtle counterweight to Beijing’s regional hegemony.
Coronavirus is a case in point: They see the Taiwanese taking a very open, knowledge-based approach, while authoritarian China’s first instinct was to clamp down on movement and communication while hiding facts from its public.
The effects of coronavirus notwithstanding, Taiwan’s economy remains strong. With a population of only 24 million, it ranks in the global top 25 of gross domestic product, and showed a respectable year-over-year growth rate of 3.3% in the final quarter of 2019. The Taiwanese military is strong and operates many advanced weapons systems — some produced domestically and others bought from the U.S., including a $2 billion deal reached last year to purchase Stinger anti-aircraft missiles, Abrams tanks and other heavy equipment.
I visited with the minister of defense, Yen Teh-fa, who projected confidence in Taiwan’s ability to conduct its primary mission: repelling a potential Chinese invasion. While there is no doubt that China would eventually be able to subdue the island through brute force, the Taiwanese military has enough capability to make it a painful and therefore unlikely scenario.
While the New Southbound Policy is attractive to many of the nations in the region, most remain wary of how China will view increased engagement with what it considers a rogue province. This is less of an issue for countries such as Vietnam and Singapore that maintain a reasonable distance from China and see engaging with Taiwan as a way to signal that they will not be dictated to by Beijing. Others such as the Philippines — which has been trying to draw closer to China and away from the U.S. under mercurial President Rodrigo Duterte — are trying harder not to offend the Chinese. The Chinese, who believe it’s only a matter of time before Taiwan returns to the fold, have in recent years allowed a surprising level of latitude in its neighbors’ trade dealings with Taiwan.
For the U.S., a strong and independent Taiwan is valuable not just as a counterweight to China but as a driver of economic growth and democracy across East Asia. Washington should continue to sell defensive arms to the Taiwanese — there is a particular need for anti-submarine aircraft and torpedoes, missile-defense platforms and communication systems. While the U.S. does not conduct formal military operational exercises with Taiwan, only limited training exchanges and table-top drills, it should certainly consider doing so.
The U.S. should maintain its policy of recognizing mainland China as the “one China,” but it should also step up informal relations with Taipei. This includes diplomacy such as humanitarian projects, scholarly exchanges, disaster-relief cooperation, diplomatic conferences and encouraging investment by U.S. and European companies. Helping Taiwan in ways that do not directly confront Beijing is possible, and should be key to America’s larger strategic approach keeping China in check across the South China Sea.