Taiwanese President Tsai: Taiwan Won’t Succumb to China’s Pressure. Wall Street Journal

Taiwanese President Tsai: Taiwan Won’t Succumb to China’s Pressure

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Taiwan's President Tsai Ing-wen speaking at a seminar in Taipei last month. PHOTO: DAVID CHANG/EUROPEAN PRESSPHOTO AGENCY

Oct 5, 2016 5:31 am HKT

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Taiwan President Tsai Ing-wen came into office in May, swept into power by a landslide election that lifted her Democratic Progressive Party, long in opposition, to control of the legislature. She promised to re-gear the island’s economy away from its dependence on China and promote social fairness. Beijing is wary of her and her party, which officially supports the island’s independence from China. Though she pledged to maintain the status quo with China, Beijing has sought to exert pressure on Taiwan—something she said Taiwanese will resist. Ms. Tsai sat down with The Wall Street Journal to discuss her first four months in office. Here’s a transcript of the interview:

WSJ: You came into office a little more than four months ago. You promised in your inaugural address to abide by the previous understandings with China. Beijing immediately called it an “incomplete answer sheet” and since then Beijing has taken steps to apply pressure–political, diplomatic, and economic. What happened here? Did your administration misread China? Did Beijing misread you?

Tsai:  The content of the May 20 inaugural speech was a result of very good thorough analysis and assessment. Combined with the majority consensus among the Taiwan people, the speech was an expression of our greatest goodwill and our maximum flexibility. I believe the stance that was expressed on May 20 has already greatly narrowed the gap between the positions of the mainland and Taiwan. To us, May 20 was the greatest goodwill and the largest flexibility.

After May 20, we saw that the mainland also displayed a level of relative reasonableness and calm. For example, when I visited Panama, the resistance we faced from China was relatively less. After that, we also saw a few actions from mainland China that were amicable.

However, in the past few months, we also saw some recent developments. It seems Beijing is starting to revert back to the old ways.  Not only was it reflected in the ICAO incident. At the same time, we see that China is doing things to create divisions inside Taiwan by using different ways of handling people with different political preferences.

If we use the traditional vernacular to describe the situation, it would be that China, for some time, seems to have reverted back to the old paths, which is suppression and division. To the people of Taiwan, Taiwan is a very democratic society. Even though there are different views in Taiwan, on the whole we basically all hope that China will respect Taiwan’s democracy and all the positions and judgments that have developed in Taiwan as a result of the democratic mechanism.

So in conclusion, in light of recent developments, we remain the same.  As we have said before, we are committed to maintaining the cross-strait status quo. The pledges we have made in the past remain unchanged. Our goodwill isunchanged.  But we will not succumb to pressure from China. We don’t want to, we are not willing to and we won’t revert to the old path of conflict and confrontation. But I also hope that both sides can quickly sit down together and discuss to improve bilateral communication.  This will eliminate much of the unnecessary misunderstanding. We can also find mutually acceptable solutions to many of the problems that face us.

WSJ: Next week will be Taiwan national day — Double Ten. There are Taiwan watchers in China who say this is yet another opportunity for you get things right, to set things right with Beijing. What do you plan to say? Are you planning to alter your message to send another signal to China? Last week, you sent an open letter to DPP members, in which you called on them to “resist pressure from China”. Already one mainland newspapers has called this “a display of naked confrontation.” So are you upping the stakes here? Are you setting the relations on a collision course here?

Tsai: As I said earlier, we feel that there was a period of time after May 20 that Beijing was relatively rational, calm. But in the past few months, we have seen various people and organizations saying things and taking actions about Taiwan that are not as rational as shortly after May 20. So we should return back to the time period shortly after May 20 in which both sides do our best to maintain a stance that is calm and rational.  The stance we expressed on May 20 was the fullest extent of our goodwill as well as our greatest flexibility. I also hope that mainland China does not misinterpret or misjudge the current situation, or think that it can make Taiwanese bow to pressure. In a democratic society, this kind of pressure is felt by all. The government alone cannot make the decision.  The government must seek out the will of the people before it makes any decisions. No administration in Taiwan can make decisions that goes against the opinion of the people.

I must urge China to understand and respect the way the Taiwan people think. If you over exert any pressure and cannot correctly interpret the goodwill and flexibility released by the government on behalf of the people, then I worry that the relationship between both side will stiffen. So as I said, the commitments I made during my inaugural speech remains unchanged. Our goodwill remains unchanged. But we will not bow to pressure. We don’t want to and we are unwilling to revert to the old path of confrontation and conflict.

WSJ:  That phrase though “resist the pressure from China” — aren’t you concerned that will be misread in Beijing? When you called, as you just said, not just your political party member, but Taiwan’s society to do that, what does that mean for the people of Taiwan?

Tsai:  When I drafted this letter to our political party members, I did so in the capacity as the chairperson of the Democratic Progressive Party. In this letter, I must respond to the reaction from our party members who have strong feelings against the longstanding pressure from China. Therefore, in the letter, I expressed my understanding of their sentiment. I also told them that we must be steadfast in adhering to our principles, and we will not cave in to any pressure from mainland China. This was my original intent when writing this letter. This was a response to their worries that the government would relinquish our insistence for freedom and democracy in the face of pressure from China.

WSJ: And people at large in Taiwan?

Tsai:  That is the pretty much the same message to the people of Taiwan. The response is also for the people of Taiwan because the overwhelming majority of the Taiwan people are very sensitive to pressure from China.

WSJ: It seems though that because of geography and maybe history that China is everywhere for Taiwan. You have very ambitious plans to re-gear Taiwan’s economy and to try to, as your government has said, to decrease its dependence on China.  But here again, Beijing seems to be increasing pressure. There has been a drop-off in group tours from the mainland and that has touched off a protest here. By your official projection, the economy is supposed to grow a little more than 1% this year. Exports are down for the year so far. So how are you going to balance the present reliance on China, with long term plans to revitalize the economy? How are you going to shift investment away from China and trade with other parts of the region when you need China for near-term growth?

Tsai: I believe mainland China’s economy is also facing challenges. For example, the rise in their labor cost and the ongoing reforms in their economic structure. Moreover, the global economy remains in the doldrums. All these pose a challenge to China’s economy. Using the same logic, this means our investment and trade with China will naturally be affected.  Our past investments in China have yielded many achievements, and we want to maintain these results. However, we also must proactively seek our own growth drivers and expand our trade ties with other countries. In this way, we can expand our market and enlarge the scale of our economy. This is why we want to do the following things.

First, Taiwan’s domestic economy must undergo structural reforms. We have to shift from an economy that focused on the efficiency of the industrial and manufacturing sectors to one more importantly driven by innovation. Through innovation, we can elevate the value and the competitiveness of Taiwan-made products or services. This is the only way that we can continue to enjoy a leading competitive edge in the international market.

The complementary nature between Taiwan and China’s economies saw in the yesteryears is decreasing while competitiveness is increasing. We hope by using our knowledge in traditional industrial and manufacturing sectors as a foundation, combined with our innovative ability, we can once again upgrade Taiwan’s economy and can transform the economy to be more competitive in the international arena. This is the kind of structural reforms we must do internally.

Moreover, apart from the Chinese market, we all know of the immense potential in the Southeast Asia and South Asia economies.  We also hope we can develop more interactions with these countries economically, culturally, and commercially. By doing so, we can widen our market and enlarge the scale of our economy.

In other words, we feel there is high complementarity between Taiwan’s economies and those in South Asia and Southeast Asia. We hope to ride on the foundation set by the previous Taiwanese investors in those regions and reinforce our links with those countries in terms of trade, economy, and culture. We feel at the present moment, Taiwan has much expertise, know-how and experience that is needed by these countries. We are happy to share with them what we know.

You mentioned about tourism. It is correct that the number of tourists from China in August and September has declined. But we also seeing the numbers are returning on an uptrend even though that trend is still wobbly at the moment. However, at the same time, if you look at the overall yearly figures, the number of tourists from other countries is increasing. So on the whole, the decrease in tourism is not too significant. In fact, as we see an increase of tourists from some regions, we expect our tourism industry to remain sound. Most importantly, for those tourist operators or businesses that relied heavily on Chinese tourists, we must provide some assistance to them to help them make adjustments so they can also provide services to tourists from other countries.

WSJ: Economic restructuring and innovation, they take time. Under Chinese economic pressure, are you prepared and are the people of Taiwan prepared to go through a period of slow, low or no growth?

Tsai: As I just said, actually in the past few years, even under the previous administration, we have witnessed a slowing trend in Taiwan’s economic growth. I believe there are several reasons for the slowdown.

First, in relation to Taiwan, the Chinese economy has become more competitive, rather than complementary. The past collaborative relationship between Taiwan and China in terms of product manufacturing or services has been replaced by China’s own local manufactures.

Moreover, the economic restructuring of Taiwan’s economy should have started more than a decade ago. This has resulted in an inadequate driving force to get the economy moving. Therefore for us, the most important thing is to quickly find the growth drivers to set the economy in motion.

You are right. If we only rely on innovation, we won’t be able to shift Taiwan’s economy in the near term. But I have also said, a strength of Taiwan’s economy is our strong industrial output capability and our prowess in research and development. Our human resources are also plentiful. Under such circumstances, we can enlarge our market presence and our base by using our pre-existing expertise as our foundation. This is why we have the New Southbound Policy. We must strengthen our ties with Southeast Asian or South Asian countries which are complementary to our economy. This way, these countries fully take advantage of our present foundation which we built up in the past.

At the same time, we can accelerate our innovation capability in future industries, such as IOT and green energy. We also want to set our eyes on biotech as one of our key areas of development. We also hope industries such as machinery and national defense can also see rapid development.

What I want to tell you is we are not starting from zero. In fact, we have rich resources to set us off on the path to future industries. As along as the government can consolidate the resources in the country and accelerate our strides, these industries can reach the next stage in no time.

WSJ: Is the task of economic diversification also somehow tied to Taiwan’s room for maneuver in the international community? Do you think that Beijing will allow Taiwan to enter multilateral trade agreements and free trade agreements with other countries? In recent months, we have seen China restore its diplomatic relations with Gambia. Political analysts expect that some among the fewer than two dozen diplomatic partners of Taiwan will break ties. Beijing is constraining Taiwan’s participation in international organizations. So what are you doing to address this kind of diplomatic blockade, particularly as far as Taiwan’s sphere of action in international organizations?

Tsai: I might have to reiterate my response to your earlier question because my answer was a bit long winded. You feel an innovation-led economy might take time to produce real results. That is the fact. This is why we hope we can we can foster better and more complementary relationships with emerging economies in Southeast Asia and South Asia. We hope to do this in the shortest time possible and develop ties with these countries in a more efficient and useful manner.

On a mid-term perspective, because we already have the basic infrastructure, as long as we are able to consolidate our resources and provide clear policy, innovation can quickly bring the existing foundation to the next generation.  Therefore, from this perspective, whether it be short term or long term, Taiwan’s economic strength and momentum will be revived steadily as long as we take all the necessary measures.

You just mentioned our relations with other countries. Even though we only have formal ties with a handful of countries, in terms of substance, we maintain a good relationship with many countries. For example, at the May 20 inauguration ceremony, over 700 delegates from 59 countries took part in the event, include nearly 10 heads of states or deputy heads of states.

To us, whether it be substantive relations or formal foreign ties, the most important factor in maintaining our relationship with these countries is whether or not there are common interests. Our common interests are based on our collective pursuits in economic growth, trade ties and values.  If we can develop these ties to the fullest extent, I feel we can maintain strong and stable ties with these countries, both allies and non-allies alike.

In the past, many people think that in foreign relations or external relationships there can be a separation between politics and economy. However, nowadays, we see the interactions of many countries are multifaceted and based on whether the economies are complementary, and moreover, whether or not the values that we pursue are the same.

This is exactly why this administration emphasizes the element of complementarity in our efforts to foster deeper ties with other countries. We focus on the actual substance of ties. If our markets and economies are complementary, then this is a relationship that’s imperative for us to pursue.  This way, our relations would be mutually beneficial. I think in the past few months, I have held similar discussions with many countries. The feedback has been very positive and they all agree with this view. The relationship must follow market and economic logic. This is the most important principle in our future pursuits in terms of fortifying our ties with other countries.

WSJ: How do you plan to enhance Taiwan’s participation in international organizations?

Tsai: We definitely want and we definitely will use our strength to beef up our relations with other countries and do our very best to contribute to the international community. Let everyone see Taiwan and understands the importance of Taiwan’s existence. After all, from the past to the present, Taiwan’s economic status cannot be overlooked. Moreover, Taiwan’s democratic development has earned compliments from all people in Asia. Taiwan, by itself, is a representation of a value. It is a successful example of economic development. Taiwan’s democratization is also another model of success. The pursuit of democracy, freedom, and human rights by Taiwan society are all universal values. To Asia, Taiwan represents a new model.

When members of the international community look to Taiwan, they should be able to appreciate the importance of Taiwan’s existence.  Meaningful, proactive, and substantive participation for Taiwan in international organizations is a positive thing and a positive contribution to the international community. I believe we must do our very best to let the world see Taiwan and take Taiwan’s existence seriously. From another perspective, we also hope the international community can speak up for us and right the wrongs for us. Especially at key moments, they can stand by our side to overcome hurdles together and let Taiwan to have more active, more meaningful participation in the world.

WSJ: Recently, the International Civil Aviation Organization meeting was a setback for Taiwan. So how do you avoid that in the future? How do you lessen or avoid interference from Beijing, or get Beijing’s tacit support for Taiwan’s greater participation?

Tsai: I think both sides must have a sit-down discussion. During the initial onset of the ICAO incident, through the Mainland Affairs Council, we expressed our hope to have a sit-down discussion with mainland China. Of course, we also have other countries who have voiced their support for us that Taiwan should be invited to participate in this year’s meeting. I think on this issue we need stronger support from the international community. But we also need to have a sit-down discussion with China to come up with a solution that is mutually acceptable to both sides.

WSJ: Another vital tie for Taiwan has been its relationship with the United States. Yet, again, in the region, China’s influence is rising. There are some countries that are reevaluating their relationship with Washington and the U.S. commitment to them. What do you want from relations with Washington? How do you think the upcoming election, whether Donald Trump or Hillary Clinton wins, will change the security landscape in the region for Taiwan? And do you have a message for the presidential candidates?

Tsai: We definitely cannot give any comment on the U.S. presidential election at this stage. But I think no matter which candidate wins, the new leader will maintain the longstanding relationship with Taiwan. In particular, we also look forward to the new administration continuing U.S. commitments outlined in the Taiwan Relations Act and the Six Assurances. At the same time, the U.S. will abide by the Taiwan Relations Act and continue to provide the weapons for self-defense that Taiwan needs.

Taiwan’s national defense and our self-defense capability are very important because they can be a stabilizing force for the geopolitical situation in the region. At the same time, the stability of the region provides a stronger foundation for regional prosperity and peace. Therefore, in regard to the transfer of power of the new U.S. government, we look forward to the U.S.’s continuous efforts in Asia in order to perpetuate the balance in the region as well as uphold the region’s peace and stability.

WSJ:  The security picture in the region is changing, and you only have to look to your southern neighbor, the Philippines, which has downgraded its cooperation with the U.S. military. On the South China Sea, many were surprised when your government, and you personally, came out against the international tribunal ruling, and not only that you dispatched a naval frigate to Taiping Island, or Itu Aba. There are some people who took that as a friendly gesture to Beijing or a signal that you would maintain the status quo. Why did you do it? Why not use it as an opportunity to adjust Taiwan’s sovereignty claims?

Tsai: Regarding the judgment of the South China Sea tribunal, our response was based solely on our own independent assessment and on Taiwan’s interests. We also made it clear why we find the ruling unacceptable and why it was not legally binding on Taiwan.

There are three reasons. First of all, we were not invited to participate in the entire proceedings. Our views went unexpressed. Secondly, in the ruling, it referred to Taiwan as “Taiwan Authority of China.” We cannot accept this. Third, in our opinion, Taiping Island which we currently occupy, is an island and not a rock. We made it clear to the international community that these are the three reasons why we cannot accept the ruling.

I repeat, our response is solely based on our own independent judgment and on the national interests of Taiwan.

On this issue, our stance on the South China Sea dispute is very clear. That is: the Republic of China is entitled to all rights afforded to it in accordance with international law and maritime law. In other words, our insistence on the South China Sea and its surrounding waters is in compliance with international law and maritime law. We did not depart from the mainstream stance of the international community. We reiterate any solutions made on this issue must be based on international law, maritime law, and the United Nations Convention on the Law of the Sea.

We have consistently called for the South China Sea dispute to be settled through multilateral negotiations, and we hope all the countries involved will recognize that Taiwan is a related stakeholder. As a stakeholder, we must be part of the negotiations and be allowed to participate as other claimants.  At the same time, our government will continue to strengthen our roles in issues such as humanitarian assistance, emergency rescue, scientific research and environmental and ecological conservation. We hope that Taiping Island, which we occupy, will play a crucial role on this matter.

WSJ: Moving on, your predecessor held a landmark meeting with Chinese President Xi Jinping. In that meeting, President Xi told President Ma that both sides share history and ancestry. He also brought up a reminder about pledges to abide by “One China?” Would you like to meet President Xi? If you had the opportunity, what would you tell him?

Tsai: During the Ma-Xi meeting, we noticed that the two sides expressed their opinions on the “One China” issue. While we believe it is a good thing for both sides to have a sit-down meeting,  we believe it is not conducive to the discussion to set a political framework. Because there are differences in our position it is even more imperative for both sides to sit down and talk. However, it has been a longstanding practice of China to set political preconditions before any meaningful dialogue can be held. I think this is obstructive to the development of our relationship.

Of course, we are keenly aware of the differences in our stances. This is the reason why we demonstrated the fullest extent of our goodwill in the May 20 inaugural speech while taking into consideration the common denominator of both sides. In the speech, we promised to conduct cross-strait affairs by abiding by the Constitution of the Republic of China and the Act Governing Relations Between the People of the Taiwan Area and the Mainland Area. We have also said that we acknowledge that in the year 1992, a joint understanding was forged by both sides after a meeting. This is a display of our effort to narrow the gaps between the two positions and our flexibility, as well as our goodwill.  But what we don’t want to see is China imposing a political framework for any meaningful dialogue and communication. Our talks should not be confined to a preset political framework.

WSJ: China’s rule in Hong Kong has become more contentious in recent years among some people in that territory. Are you watching the situation there. Does it have any lessons for Taiwan?

Tsai: We have been closely monitoring the development of Hong Kong after the Umbrella Revolution. This is because the people of Taiwan and the people of Hong Kong have the common pursuit of freedom, democracy and human rights. We hope Hong Kong’s democracy can also be respected and that the people there can exercise their rights entitled to them under a democratic system.  But of course, Taiwan’s situation is different from Hong Kong. We are, after all, a sovereign independent country while Hong Kong is constrained by the “One Country, Two System” policy. However, both sides do aspire for the same things, which are democracy, freedom and human rights. We will continue to monitor the development of Hong Kong and watch how the Chinese government handles the Hong Kong people’s pursuit for democracy, freedom and human rights.

WSJ: Should China stop using the “one country, two system” formula when it comes to talking about a resolution to relations with Taiwan?

Tsai: Politically, Taiwan and Hong Kong should be handled differently because of the differences in our status and conditions. But we have the same goal which is the pursuit of democracy, freedom and human rights. I think when it comes to Hong Kong people’s increasing desire for democracy, mainland China should respect that and allow the people of Hong Kong the space to exercise their rights on the basis of democracy.

WSJ: The Chinese side severed the normal communications channel with Taiwan in recent months. In trying to reset the relations and put them back to the situation right at your inauguration, how are the two sides communicating? When you talk about expansion of Taiwan’s participation in international organizations, how are you approaching that subject with China? How are the two sides communicating?

Tsai: From the past until now, the communication between Taiwan and China takes place on multiple fronts and is not just limited to the Straits Exchange Foundation and mainland China’s Association for Relations Across the Taiwan Strait. Even though the communications channel between the two organizations has been temporarily suspended, other communication channels are still viable to allow both sides to keep talking. As said, we hope our relationship will return to the condition seen around the time of the May 20 inauguration. We hope both sides will exercise rationality in dealing with the issues before us.This requires making some adjustment on our individual part. We reiterate again and reconfirm that our pledges remain the same. Our goodwill is unchanged. But we will not bow to pressure and we have no intention in returning to the old path of confrontation and conflicts.

WSJ:  Not to be too off topic, but my colleagues would find me remiss if I didn’t ask about your life out of work. We hear two things. One is your love of cats and the other is supposedly you like to drive and drive quickly.

Tsai: This first thing is correct. The second is a slight misunderstanding. Of course, everyone knows of my love to animals. In my house, there are not only two cats, I also have three dogs. Recently I adopted three retired Labrador retrievers who worked as seeing guide dogs. They are around seven or eight years old and are already retired. I feel they should have a good retirement, so I adopted them. I hope my two cats and three dogs can live in harmony. I believe I have the ability to let them coexist peacefully.

The second thing about me as a fast driver is a slight misunderstanding. Even though when I was younger, sometimes I would drive a little too fast, right now, that is impossibility.

I like to drive around Taiwan. I often tell our foreign guests they drive the circuit around Taiwan because it is really beautiful. This can also be a big challenge for people who know how to drive. If you’re able to drive on the Suhua Highway, if you can drive on Freeway No. 5,  and if you can handle driving on the South Link Highway, that means your driving skill should be recognized.

Recently, I also tried to drive. I negotiated with my security detail whether I can drive or not. They said sure, but under one condition: That is there must be a car in front of me and another car behind me. In that case, I find it meaningless. So I have succumbed to the fact this is a reality that I must accept now.

–Charles Hutzler and Jenny W. Hsu