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By STUART LAU
with PHELIM KINE
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WELCOME TO CHINA WATCHER. This is Stuart Lau in Taipei, covering the final week of Taiwan’s presidential election race. For the first time in the democratic history of this island of 23 million, there are not two but three strong candidates vying for the top job. Ask even the most seasoned pundits here, and no one can say for sure which man (yes, it’s all men this time) they’re putting their money on. We’ll have more below. Phelim Kine will be with you on Thursday.
BREAKING NEWS THIS MORNING: Taiwan's defense ministry issued an emergency alert, sent to all mobile devices, warning about a Chinese satellite that flew over southern Taiwanese airspace. It's a confusing message in English, however, as it referred to the satellite as a "missile," causing outrage among opposition politicians. Chinese state media confirmed the launch of a probe satellite shortly after the Taiwanese alert.
And mark your calendar: Join Phelim tomorrow at 10 a.m. ET for a special trans-Pacific POLITICO Live event "Turning Point for Taiwan: A Presidential Election Preview" to unpack the implications for U.S.-Taiwan-China relations posed by the Jan. 13 vote. Speakers include U.S. Rep. Raja Krishnamoorthi, (D-Ill.), ranking member of the House Select Committee on China, Fan Yun, a legislator for Taiwan's ruling Democratic Progressive Party and Jason Hsu, a former opposition Kuomintang party legislator. Register here.
TAIWAN DISPATCH
THE LAST 96 HOURS: The three candidates will be running around Taiwan over the next four days, as voters are still deciding which one to back. There’s no polling data to refer to at this stage — there’s a 10-day blackout prior to the election, as per Taiwanese regulations.
Incumbent problems: While most Taiwanese people are skeptical of China, there’s a lot more to consider when it comes to who leads their country for the next four years. It’s especially challenging for the ruling Democratic Progressive Party. While the mild-mannered outgoing President Tsai Ing-wen has given Taiwan greater play in the international spotlight over the last eight years, many locals are disgruntled about what they see as a lack of major economic achievements at the grassroots level. That’s not good news for the DPP candidate, current Vice-President William Lai.
I went to the rallies on “Super Saturday”: And I’m nearly deaf.
Both the DPP and Kuomintang (KMT) meetings ones took place in Taoyuan city, just outside of the capital Taipei, on the final Saturday before the election. Huge crowds turned out, many bussed in. At the DPP event, Lai was there alongside his VP pick, Bi-khim Hsiao, as well as Tsai, the outgoing president. There was a large animated screen as the backdrop, showing the DPP’s achievements over the past eight years, with loudspeakers all around a former tire factory. At the gathering of the more China-friendly KMT, a 20-minute walk away, the rally started with some singing. Presidential candidate Hou Yu-ih was flanked by other party heavyweights who were more popular than him. The crowd was mostly middle-aged and elderly people. Adamantly no fans of Taiwanese independence, the main message was: Get rid of the DPP.
That places the third party in an interesting spot: Lai’s most formidable challenger who’s eating into the DPP’s traditional voter base is Ko Wen-je, the Taiwan People’s Party (TPP) presidential candidate. Ko has been appealing to young voters, many of whom are tired of the two main traditional parties, the DPP and the KMT.
The third way: Ko’s tack is not unlike Emmanuel Macron’s who won support in France by shunning both the left and the right. “The 2024 presidential election is a contest between new politics and old power,” Ko said in a rally on Sunday. “It’s a contest between rational, pragmatic science and ideologies. It’s a contest between civil society and old-school head-counting politics. We shall take the DPP down — without pushing the KMT back to power.”
But but but: There’s a lot of speculation that the TPP would join hands with the KMT if they can build a majority in the parliament, known as the Legislative Yuan. On foreign policy, Ko’s line is to be pro-U.S. and friendly toward China. As Taipei mayor until last year he sought to build ties with China, most notably by chairing regular events with Shanghai. On a Facebook post last year, Ko said he fully recognized Tsai’s current approach to shoring up defense capabilities and international partnerships. But he’s also critical of her lack of interaction with Beijing, due to China’s mistrust of the DPP.
DPP APPEALS: Lai seeks to allay concerns that he will actively pursue Taiwan independence if elected. The man who called himself a worker of Taiwanese independence seven years ago now says he’s OK to work with Beijing, so long as the conditions are right.”Taiwan independence” is a trigger phrase that Beijing, set on unification, says will lead to war.
“Peace is priceless and there’ll be no winner in the event of war. Peace is the only option,” Lai said during an international press conference. “As long as there’s reciprocity and dignity, Taiwan will always open its door, willing to conduct exchanges and cooperation with China.”
And a plea to Europe: Asked about Europe’s lack of active participation in ensuring Taiwan’s security, Lai said: “Taiwan and Europe may be far apart geographically, but we both share common values such as democracy, freedom and human rights.”
“Taiwan also looks forward to working together with Europe on peace in the Indo-Pacific region," Lai added. "I'd like to use this opportunity to thank European countries for expressing … opposition to changes to Taiwan Strait status quo through military means by authoritarian countries." Such remarks by European countries, he said, "are enormously conducive to Taiwan's security." Here’s the story.
Much tougher spot: Lai is fighting an uphill battle that’s very unlike Tsai’s 2020 reelection, in which she scored a record-breaking eight million votes — thanks to the public’s fears about China’s repressive policy cracking down on protests in Hong Kong.
So why is DPP losing support? “People are tired of the DPP, they want change,” said Syaru Shirley Lin, who runs a new Taiwanese think tank, the Center for Asia-Pacific Resilience and Innovation, and a non-resident senior fellow at Brookings Institution. “Over the last few years, a lot of people feel like the DPP basically governed not meritocratically.” Lin pointed out that the DPP has also failed to build a close relationship with the business class, while the KMT did, which means it’s more difficult for DPP politicians to recruit private sector talent.
KMT HAS ANYTHING BUT UNITY: There’s no consistency in their China policy. Presidential candidate Hou, a former policeman, is often viewed within the KMT as a native Taiwanese since his family had been in Taiwan for generations. That means it’s difficult for him to win the full trust of the KMT’s core base — those who identify as Chinese from mainland provinces — and this voter segment places its trust in the vice-presidential pick Jaw Shaw-kong, a radically pro-China figure.
"I think the KMT is confused," said Lin, the think tanker. "They were trying to have it both ways in saying that, by virtue of us being conciliatory, the prospect of war is less. And I think a lot of young people don’t believe that’s a good answer. Because, what if the CCP unilaterally decided you’re not so friendly to them?"
ICYMI: Here’s my write-up on all you need to know how this election, from earlier this week.
FRANCO-CHINESE TRADE WAR
FRENCH BRANDY SECTOR'S HANGOVER OVER CHINA PROBE: The trade relationship between the EU and China took another hit on Friday as China announced it would investigate whether European producers of liquors are dumping their products on its market. Camille Gijs, Antonia Zimmerman and Koen Verhelst of POLITICO’s trade team write in to report.
Distilling the threat: In a step that appeared targeted primarily against France's large brandy sector, Beijing revealed its displeasure over the EU's assertiveness in its trade ties with China, including a probe into made-in-China electric vehicle subsidies that was launched thanks to a single-handed push from Macron's government.
Sip happens: The Chinese inquiry will likely target cognac, Armagnac and other brandies. Although the Ministry of Commerce didn’t name any countries or distillers in its announcement, the focus of the probe will be on "spirits made from distilled wine originating in the EU" — clearly singling out French brandies. It’s all very reminiscent of how China threatened the EU wine sector after Brussels launched a trade probe in Chinese solar panels a decade ago. Beijing sees Paris as the vulnerable point to strike.
France is by far the largest source of alcoholic beverages imported into China, representing 37.2 percent in 2022, according to Daxue Consulting, a China-based consultancy. The second largest exporter, the U.K., didn't even crack 10 percent. In the brandy segment, France accounts for 99 percent of all Chinese imports.
Graping the attention: According to Francesca Ghiretti, a senior geoeconomics analyst at the Adarga Research Institute, Beijing wants to make it appear that it followed the rulebook for its inquiry, based on a complaint from the industry rather than launching a probe out of its own initiative.
"It does really seem that [the Chinese Ministry of Commerce] is trying to show that they are following what the regular procedure is and there’s nothing related to retaliation because the industry complained," the expert added.
Read all the details in our story here.
MORE ON EUROPE-CHINA
CHINESE BATTERY OVERPRODUCTION: The European Commission is ready to "initiate trade defense investigations" into Chinese car batteries if it receives "evidence that products are imported under unfair and injurious conditions," EU Trade Commissioner Valdis Dombrovskis said in an answer to a question from Dutch center-right lawmaker Tom Berendsen on Monday.
BEIJING WANTS IT BOTH WAYS WITH EUROPE AND RUSSIA: In a speech earlier this week, Chinese Foreign Minister Wang Yi singled out Europe and Russia as the two top priorities for Chinese diplomacy, adding that it's important to build "closer high-level exchanges between China and Europe."
BELGIAN PM TO MEET XI: President Xi Jinping is scheduled to meet visiting Belgian Prime Minister Alexander De Croo on Friday. My colleague Camille Gijs will be reporting on the ground, bringing you all the latest news.
‘MI6 SPY’ UNDER CHINESE DETENTION: China said Monday it has detained a foreign national who was the head of an overseas consulting firm for allegedly spying for the U.K.’s MI6. China's civilian spy agency, the Ministry of State Security, said in a statement it had apprehended an individual, surnamed Huang, but it gave no details about Huang's full name, gender or nationality, nor did it identify the company they worked at. CNN has more.
TRANSLATING WASHINGTON
BEIJING SANCTIONS U.S. ARMS FIRMS: The Chinese government has imposed sanctions on five U.S. weapons manufacturers that Beijing has linked to a $300 million defense equipment sale to Taiwan last month. The sanctions against BAE Systems Land and Armament, Alliant Techsystems Operation, AeroVironment, ViaSat and Data Link Solutions are a reprisal for U.S. arms sales to Taiwan that "undermine the peace and stability across the Taiwan Strait," China's Foreign Ministry said in a statement on Sunday. The sanctions involve "freezing the properties of those companies in China, including their movable and immovable property, and prohibiting organizations and individuals in China from transactions and cooperation with them," the statement said. None of the five firms responded to requests for comment.
WANG YI TELLS U.S.: 'RELAX' ALREADY: Chinese Foreign Minister Wang Yi urged the U.S. to "relax its mindset" in its approach to bilateral ties. That should include respect for "the choices of the Chinese people, China’s path of development, China’s core interests," Wang said in a speech marking the 45th anniversary of U.S.-China relations on Friday. In an implicit jab at U.S. support for Taiwan ahead of the island's general election on Saturday, Wang called for the Biden administration to respect "China’s defense of the country’s sovereignty and territorial integrity." Wang also marked progress made by President Joe Biden and Chinese leader Xi Jinping in their meeting in November in thawing frosty bilateral ties by noting that "the two militaries have resumed communication and dialog on the basis of equality and respect, and the working group on counter-narcotics cooperation is about to be launched after removing obstacles to unilateral sanctions.”
FBI HOUSTON WARNS OF CHINESE 'CYBERSTALKING': The Federal Bureau of Investigation's office in Houston, Texas is warning of intimidation campaigns targeting U.S. citizens. Agents of Beijing "may be cyberstalking, physically intimidating, and harassing Chinese citizens, naturalized U.S. citizens, and families of dissidents who speak out against the Chinese Communist Party in Texas," the FBI said in a post on X on Friday. The Chinese embassy rubbished those allegations. "The so-called 'China threat' hyped up by the U.S. side is completely fabricated…groundless slander and smears on China," Chinese embassy spokesperson Liu Pengyu said on Saturday.
BEIJING: CBP 'WANTONLY SUPPRESSING' CHINESE ARRIVALS: The Chinese government's recent sunny rhetoric about a revival in U.S.-China people-to-people ties since Biden's meeting with Xi in San Francisco in November took a dark turn last week. In recent months Customs and Border Protection has "deported dozens of Chinese arriving in the U.S., including students," Chinese Foreign Ministry spokesperson Wang Wenbin said on Thursday. Those deportations reflect a campaign of "wantonly suppressing and ill-treating Chinese students traveling to the U.S. with lawful and valid identifications and visas," Wang added.
Chinese embassy spokesperson Liu Pengyu piled in via an X post by decrying the "interrogation, harassment and deportation" of Chinese students entering the country. The embassy didn't respond to a request for details.
"Students from the People's Republic of China are welcome in the United States," said a State Department spokesperson granted anonymity because they weren't permitted to speak on-record. The spokesperson directed China Watcher to the Department of Homeland Security for more details, but neither agency responded to requests for comment. Stay tuned.
MANY THANKS: To editor Christian Oliver, reporters Camille Gijs, Antonia Zimmerman and Koen Verhelst and producer Seb Starcevic.
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