The TaiwanChina Relationship

The Taiwan/China Relationship

The Taiwan/China relationship can serve as a model for developed and developing countries ' economic relationships despite political difficulties.

Very few people in Taiwan will deny that China has a lot of influence on the island, be it positive or negative. It is a love-hate relationship. On one hand, the island has its Chinese heritage and is proud of its association with the long history of China. On the other hand, Taiwanese feel bullied and threatened by its giant neighbor in the international political front.

Kuomintang is the political party that supposedly aims to recapture the mainland China from the Communist rule and the Democratic Progress Party (DPP) is the political party without such ambition . One would expect China to be friendlier to DPP. However, the reality is exactly the opposite . China prefers Kuomintang to be the ruling party. In its awkward effort to sabotage DPP in the year 2000 presidential election, China's political leaders gave stern warnings to the Taiwanese not to vote for DPP candidate Chen Shui Bian. The end result was that Chen Shui Bian won the election. Many would agree that the biggest help Chen Shui Bian secured during the campaign was from the leaders of mainland China.

Politically, the two places couldn't be farther apart. Economically, they are tightly integrated. Taiwan is the largest investor in mainland China and hundreds of thousands of Taiwanese live in China. Many of them are in fact members of the Communist Party.

As recently as 1999, Taiwanese companies were not allowed to invest in China. Nor are Taiwanese below a certain age allowed to travel to China. Under the policy of "jie ji yong ren" (which means that "my dear friends , as the cross-strait situations are unusual and dangerous, you have to exercise patience and control in any interaction with the mainland Chinese") of ex-President Lee Teng Hui, Taiwanese are told not to have anything to do with the mainland Chinese. Over the years , however, many have circumvented the policy by investing in China through holding companies in Hong Kong.