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Hong Kong clouds Taiwan's future as China support wanes

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Shanghai/Taipei | As violent clashes between protesters and police in Hong Kong make headlines around the world, a potentially more explosive foreign policy battle for Beijing is brewing on another island in the South China Sea.

Taiwan, the self-governing island state which China's government claims as one of its own provinces, is an unresolved issue for President Xi Jinping as he grapples with continuing unrest in Hong Kong, a slowing domestic economy and an increasingly hostile Washington.

Tsai Ing-wen, Taiwan's first female president, swept to power in 2016. AP

The 70th anniversary of Communist Party rule in China on Tuesday puts the spotlight on Taiwan. The island, a former Japanese colony, became a refuge for Chiang Kai-shek’s Nationalists in 1949 after they fled mainland China when Mao Zedong’s Communist Party took control. With its democratic elections and free press, it remains a haven for those who dare to challenge the Communist Party's authority.

Taiwan faces a crucial three months ahead of 2020 presidential elections, which may determine whether it can maintain its independence or accept annexation by China. Tsai Ing-wen, Taiwan's first female president, swept to power in 2016 when her pro-independence Democratic Progressive Party secured control of the legislature for the first time amid concern Taipei had become too reliant on China.

Until mass protests broke out in Hong Kong four months ago, the chances of Tsai hanging onto power looked slim. The China-friendly Kuomintang (KMT) Party was leading in the polls and Beijing's battle to win the hearts of minds of voters through economic incentives and propaganda appeared to be working.

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But as workers in Taipei last week erected grandstands in front of the Presidential Office ahead of celebrations for Taiwan's national day on October 10, many in the capital no longer appear to be in the mood for another regime change. Fittingly, the national day which celebrates the 1911 revolution that led to the end of dynastic rule.

Chinese President Xi Jinping.  AP

"Before the Hong Kong unrest, which started in early June, Tsai was lacking. Now she is on top. One of the reasons given by Xi Jinping to stay on until 2033 is that he wants to solve the Taiwan problem while he is still in power. Now this looks illusory," Willy Lam, adjunct professor at the Chinese University of Hong Kong's Centre for China Studies says.

Tsai's popularity has risen and since November last year, polling has shown public support for reunification has halved from 19.1 per cent to 9.6 per cent.

Double blow for Taiwan

Over that same time, the number of people supporting the status quo indefinitely has jumped from 22.3 per cent to 27.1 per cent, while those who want an eventual path to independence has risen from 14 per cent to 20.7 per cent.

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This raises the question of will China change tack on Taiwan if it feels its efforts at soft diplomacy are backfiring? Beijing's decision in July to ban individual Chinese citizens from travelling to the island, a popular holiday spot because of its good food and laid-back attitude, says a lot about how China's leadership view Taiwan.

Taiwan finds itself besieged on many fronts, just not economically, as China seeks to fulfil its goal of reunification with what it describes as a rogue province. In briefings with Indo-Pacific journalists as part of a study trip hosted by Taiwan's Foreign Ministry, Taiwanese officials rate cyber as the number one battleground at the moment.

While they are vigilant to the threat of Chinese hackers breaking into Taiwan's critical infrastructure, officials accuse Beijing of interfering in its domestic politics in the run up to next year's presidential election, orchestrating a "fake news" campaign aimed at discrediting President Tsai Ing-wen as well as stoking pro-mainland feelings within the public.

Taiwan last week suffered a double blow when the Solomon Islands and Kiribati switched their diplomatic recognition from Taiwan to China, with officials saying they cannot compete with China's "dollar diplomacy". Just 14 nations plus the Vatican recognise Taiwan diplomatically.

"It is a sign of Beijing’s ongoing tactic to constrain Taiwan’s international space, which is intensifying in the lead up to the election. Some major regional and global players, however, are finding ways to support Taiwan to maintain regional security," says Mark Harrison, senior lecturer in Chinese studies at the University of Tasmania.

Militarily, Chinese aircraft regularly fly into Taiwan's airspace, warships circumnavigate the island and maritime militia harass fishing vessels.

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"They've tried to intimidate and they've tried to have the psychological effect to the people in government in this country," Institute for National Defense and Security chief executive Cheng-Yi Lin says.

China looking for a 'scapegoat'

China's conduct towards Hong Kong also weighs heavily on Taiwanese minds, exposing the fallacy of the "One country, two systems" approach that Beijing wants to apply to Taiwan. With the mass marches in Hong Kong highlighting concerns about a model which was supposed to preserve the former British colony's independent legal and political systems for 50 years after the 1997 handover, there is little appetite in Taiwan to adopt a similar model.

China disagrees. Bao Chengke, director at the Institute for Strait Exchange and Development at East China Normal University, argues any "One Country Two Systems" policy for Taiwan would be different than Hong Kong, which does not have democratic elections. “One country two systems” is a very tolerant policy," he says. "Elections and different parties will be allowed and the current Taiwan system would be kept. "

"China will never resort to force if peaceful reunification can be achieved. China is patient and we will find a breakthrough one day."

One view within Taiwan's officialdom is that the intensification of activities against Taiwan is because the Chinese leadership is looking for a "scapegoat" to take out their frustrations as they come under pressure from Donald Trump over trade. Taiwan in effect has become collateral damage.

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Ironically, the trade war has been good for Taiwan. Trade officials say Taiwanese businesses are on track to bring back $US27 billion ($39.9 billion) of investment from the mainland to put into the local economy by year's end.

Factories and warehouses, shuttered when Taiwan's manufacturing sector was hollowed out in the 1980s and 1990s when firms shifted to low cost China, are beginning to hum again, with electronics one of the key drivers.

Military miscalculation

Officially, the Taiwanese government does not advocate independence, and wants to preserve the current arrangements.

"That means we don't provoke," says Ming-Chi Chen, a deputy minister in the Mainland Affairs Council.

"The status quo means that we want to maintain our sovereignty. We want to maintain our democratic way of life. We will not surrender but we will not seek immediate independence either.

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"We don't know how sustainable but it requires a lot of effort just to maintain the status quo."

Chen is alluding to the high cost of defending Taiwan. It's military budget will exceed 2 per cent of gross domestic product, with the US stepping up arms sales in recent months, including 108 new tanks, 250 handheld anti-aircraft missiles and 66 fighter jets.

Lin, from the defence think-tank, argues the US arms sales are helping to "stabilise" the region but Australian National University Professor of Strategic Studies Brendan Taylor worries the risk of military miscalculation is high with no robust crisis management system in place.

"The chance of a major crisis over Taiwan is growing. China is really upping the ante with its coercion," says Taylor, who this week published a book, Dangerous Decade, that examines Taiwan's security.
Taylor's believes Taiwan and the US can defend the island now in the event of a Chinese attempt to take it by force, but within a decade Beijing will achieve military superiority.

Preserving the peace

That has implications for Australia as both a loyal US ally as well friend to Taiwan, a fellow free market democracy.

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While the foreign minister Alexander Downer argued in 2004 that an attack on Taiwan would not trigger Australia's ANZUS obligations, Taylor says this is a "false debate".

"Given how dependent we are on the US alliance I think it would be unlikely we would turn down a US request," he says, suggesting one role for Australian forces could be to blockade the South China Sea.

Harrison says conflict over Taiwan will depend on how China approaches the delicate issue in coming years. "That depends on policy choices and policy failures in Washington and Beijing. Beijing has a clear goal with Taiwan but has yet to present a roadmap to achieve that goal without triggering a crisis, or a policy framework that would maintain an enduring peace across the Strait after the goal is achieved," he says.

It is tempting to see the China-Taiwan dispute as a Cold War hangover but Lin argues the international community has a stake in preserving peace.
"The waters between China and Taiwan, the Taiwan Strait are international waterways," he says.
"In that sense to keep the freedom of communication, the freedom of navigation is very important for any other country in this region. The Taiwan Strait is not an internal water for the PRC."

Andrew Tillett was a guest in Taiwan with the Taiwan Ministry of Foreign Affairs.

Michael Smith is the North Asia correspondent for The Australian Financial Review. He is based in Tokyo. Connect with Michael on Twitter. Email Michael at michael.smith@afr.com
Andrew Tillett writes on politics, foreign affairs, defence and security from the Canberra press gallery. Connect with Andrew on Facebook and Twitter. Email Andrew at andrew.tillett@afr.com

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