The increasing uncertainty of Taiwan’s external environment – influenced by a less predictable US leadership and an increasingly assertive China – has undoubtedly affected its domestic politics. This was reflected in the results of the 2018 local elections, at which the governing Democratic Progressive Party (DPP) suffered huge losses. While the pro-independence DPP and the Kuomintang, which has traditionally maintained closer relations with China, remain the dominant players in Taiwan’s political landscape, both need to find ways to appeal to an increasingly diverse and divided polity in the run-up to the next presidential election in 2020.
Identity politics and economic issues feature highly in Taiwan’s domestic priorities, and are closely linked to its relations with mainland China. The slowdown in China’s economy and its use of ‘sharp’ power are continuing concerns for Taiwan’s electorate.
The US remains Taiwan’s most important security and diplomatic partner, but the Trump administration’s increasingly hard line towards China gives rise to fears that Taiwan may become a pawn in a ‘great power’ game. However, rather than be distracted by the drama and unpredictability of the Trump presidency, Taiwan will be best served if it continues to support US security commitments in the region.
In response to its changing external environment, the government of President Tsai Ing-wen has attempted to diversify Taiwan’s international engagement through its New Southbound Policy (NSP), which seeks to develop economic and people-to-people ties primarily with partners in Southeast and South Asia. The NSP will be required to embrace increasing levels of immigration and openness to the outside world if it is to be sustainable. This will mean crafting a new narrative that sees Taiwan as part of Southeast Asia just as much as of the Greater China area.
Taiwan’s task is to strike a balance between maintenance of strong security relations with the US and close economic ties with China, while also diversifying and strengthening its links towards Southeast Asia. Changing regional and domestic dynamics have made this task much harder.