Billionaire's Planned Taiwan Presidential Bid Sparks Concerns Over Chinese Influence

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china-taiwan-terry-gou-april-2019.jpg In this image made from video, Foxconn chief Terry Gou (C) gestures during a press conference at Nationalist Party headquarters in Taipei, April 17, 2019.
AP Photo

The announcement by Taiwan billionaire and Foxconn chairman Terry Gou that he plans to run for Taiwan president has sparked concerns on the democratic island that his extensive business interests in China would make him Beijing's candidate.

Gou announced last week that he would step down from heading Foxconn, also known as Hon Hai Precision Industry—a key Apple supplier and maker of iPhones—to campaign for the pro-China opposition Kuomintang (KMT) candidacy.

Gou's announcement, which reportedly came after a dream in which he was encouraged to make the move by the sea goddess Mazu, has prompted concerns that the island's democracy could be undermined by his extensive connections with the Chinese Communist Party.

Incumbent Democratic Progressive Party (DPP) president Tsai Ing-wen tweeted after his announcement that presidential hopefuls shouldn't be focusing on what the gods want.

"Terry Gou is a successful businessman, the boss of a major corporation, and is likely to be an opponent worthy of respect," Tsai said via her Twitter account.

"But he may need a slight change in his outlook; presidents have to recognize that they have 23 million bosses," she said, in a reference to the population of Taiwan.

Chiu Shih-Fang, assistant research fellow at Taiwan Institute of Economic Research, said Gou's fortune is irrevocably bound up with China, and includes the need to maintain close ties with ruling Chinese Communist Party officials.

Divestment simply isn't an option at this stage, in spite of Gou's recent pledge to build the next Foxconn factory in Wisconsin, she said.

"Hon Hai got into China a long time ago, and it is unlikely that he will withdraw, owing to the degree of local government involvement and the dependency on that supply chain," Chiu told RFA.

"In the short term, Hon Hai can't transfer the majority of its operations overseas, and at this stage ... it is impossible to take profits," she said. "There will still be a very large proportion of the business that depends on China."

Chiu said close cooperation and good relations with local governments in China is central to Foxconn's mode of operation.

The company's usual way of doing business in China is to hire a large number of local workers in exchange for tax incentives, she said.

Yen Chien-fa, deputy chief executive of the Taiwan Foundation for Democracy think-tank, said Gou's entire business career relies on the biggest threat to Taiwan's existence.

He said there are clear indications that Beijing would see Gou as its own candidate, similar to the its appointment of shipping magnate Tung Chee-hwa as chief executive of Hong Kong after the handover of that city to Chinese rule in 1997.

That in itself would make Gou an unacceptable candidate for the people of Taiwan, he said.

"As president ... he would be required to stand up to China in a lot of circumstances," Yen said. "He would be in trouble when it came down to it."

"In its relations with China, Taiwan needs to stand up for its own sovereignty; it would be unthinkable for a president to safeguard the interests of the other side, as opposed to the interests of Taiwan,"
he said. "And whose side would he be on in the deep-running [trade] conflict between China and the United States?"

Xi's letter

In a Jan. 2 speech titled "Letter to our Taiwan compatriots," Chinese President Xi Jinping insisted that Taiwan must be "unified" with China, and refused to rule out the use of military force to annex the island.

Tsai replied at the time that Taiwan's 23 million people have no wish to give up their sovereignty, and that China should first move towards a democratic system.

She also recently called on Washington to aid their bid to resist "coercion" from Beijing, saying that the 40-year-old Taiwan Relations Act has been crucial to preventing instability in the region.

KMT mayor of Kaohsiung Han Kuo-yu welcomed Gou's announcement, precisely because of his China connections, however.

"Terry Gou has direct connections with [the Chinese Communist Party leadership in] Zhongnanhai ... and with the White House," Han told journalists after Gou's announcement. "This will definitely help ...
Taiwan's biggest headache with [China] right now is that all communication channels are basically shut down, which isn't very safe for Taiwan."

A recent opinion poll found that more than 80 percent of Taiwanese would reject President Xi's offer to rule the island via the "one country, two systems" model used for the former colonies of Hong Kong and Macau.

Independent island

Taiwan was ruled as a Japanese colony in the 50 years prior to the end of World War II, but was handed back to the 1911 Republic of China under the Kuomintang (KMT) government as part of Tokyo's post-war reparation deal.

It has never been controlled by the Chinese Communist Party, nor has it ever formed part of the People's Republic of China.

The island began a transition to democracy following the death of Chiang Kai-shek's son, President Chiang Ching-kuo, in January 1988, starting with direct elections to the legislature in the early 1990s and culminating in the first direct election of a president, Lee Teng-hui, in 1996.

Washington cut off diplomatic ties with Taipei on Jan. 1, 1979, opting instead to recognize the People's Republic of China.

The TRA was subsequently enacted to govern the future bilateral relationship, and empowers the U.S. government to maintain commercial, cultural, and other relationships between the American people and the people of Taiwan, and to promote U.S. foreign policy.

Reported by Hwang Chun-mei for RFA's Mandarin Service, and by Chung Kuang-cheng for the Cantonese Service. Translated and edited by Luisetta Mudie.


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