Can Beijing influence Taiwan’s presidential election through economic coercion?

As Taiwan gears up for what could be its most consequential presidential election ever in January, China is taking coercive economic measures in an attempt to sway voters to support its preferred Kuomintang (KMT) party.

China has ramped up bans on imports of a variety of Taiwanese products since February 2021 when it announced it would restrict imports of Taiwanese pineapples. Restrictions on dozens of other agricultural products have followed, disrupting the business of Taiwanese farmers, fishers, and exporters, and putting pressure on the Tsai Ing-wen 蔡英文 (Cài Yīngwén) administration to support this important political constituency. Much of Taiwan’s agricultural production takes place in the southern part of the island, historically a stronghold of Tsai’s Democratic Progressive Party (DPP).

It’s a familiar playbook for China; Beijing has repeatedly used its economic clout when it wants to influence political decisions abroad by banning imports, restricting tourist visits, and taking other measures against countries over various international disagreements.

But it’s not uncommon for this kind of economic coercion to fail to achieve Beijing’s desired political outcomes — and it appears the upcoming election in Taiwan may be no different. The current nature of Cross-Strait relations, along with broader geopolitical dynamics, will make it difficult for China to sway Taiwanese voters to support the KMT.

China’s latest bans

China’s decision to ban pineapple imports in 2021 was just the first in a growing list of restrictions on Taiwanese exports. China then banned wax apples and custard apples in September 2021, and grouper fish in June 2022. Then in August 2022, just before U.S. House Speaker Nancy Pelosi made a historic visit to Taiwan, China restricted its own sand exports to Taiwan (used in Taiwan’s silicon wafer manufacturing industry), and banned imports of more than 100 Taiwanese products, including seafood products and snacks. Then in December 2022, China placed restrictions on more seafood products and alcohol brands.

Many of these products are quite exposed to China’s market. Taiwan’s grouper fish exports, for example, hit $56.6 million in 2021, with 91% going to China.

In an effort to demonstrate its ability to engage productively with the mainland, the KMT in April 2022 dispatched its vice chair to Beijing, where he met with top Communist Party officials, including the head of China’s Taiwan Affairs Office (TAO), Sòng Tāo 宋涛, and the Party’s top political theorist and fourth-ranked official, Wáng Hùníng 王沪宁. During the meetings, the TAO announced it would soon be ready to lift import bans on Taiwanese products — and a month later, China did lift import bans on two kinds of fish, chilled white hairtail and frozen horse mackerel.

Most recently, in April, China announced it would investigate Taiwan’s restrictions on imports of thousands of mainland products, with the Ministry of Commerce stating that the investigation could be extended to January 12, 2024 — one day before Taiwan’s presidential election.

The above developments make China’s message clear: KMT leaders can negotiate normal trade relations, but China is saving up ammunition in case voters collectively choose a different party in January’s election.

Agricultural and fish products make up a relatively small part of Taiwan’s total exports to China, but their production and processing is concentrated in the southwestern part of the island, where the DPP has the staunchest support. While electronics and related components are Taiwan’s main export to China, China is unlikely to ban Taiwanese exports of such products due to the difficulty of finding substitutes.

The origins of China’s leverage

China’s recent moves echo efforts during the 2000s when Beijing tried to bend Taiwanese voters toward the KMT using the allure of business with the mainland. Then-KMT Chairman Lien Chan’s (連戰 Lián Zhàn) 2005 visit to the mainland, the first time a KMT Chairman set foot in the P.R.C., set the stage for deepened CCP-KMT ties. After the visit, China began to drastically increase imports of certain agricultural products, aiming to show Taiwanese voters that KMT leadership could lead to increased prosperity.

William Norris, professor of Chinese foreign and security policy at Texas A&M University, has made the case that the moves ushered in KMT electoral victories in ensuing local elections, and ultimately contributed to the election to the presidency of KMT candidate Ma Ying-jeou (Mǎ Yīngjiǔ 馬英九) in 2008.

“Prior to the KMT coming to power in 2008, the DPP warned of the way Taiwan would be swamped by Chinese agricultural products or uncontrolled Chinese labor migration,” Dafydd Fell, director of the Center of Taiwan Studies at the University of London’s School of Oriental and African Studies, told The China Project. The DPP’s tactics failed — the KMT’s Ma was elected in 2008 with over 58% of the vote, and the DPP’s warning never came to pass.

During Ma’s first term as president of Taiwan from 2008 to 2012, trade ties deepened and Taiwanese exports grew more dependent on China, giving the P.R.C. more leverage over its island neighbor. The two sides in 2010 negotiated the Economic Cooperation Framework Agreement (ECFA, 海峽兩岸經濟合作架構協議), which contributed to increased business for Taiwanese exporters.

“Up to [2012], I think the strategy was actually working, and the majority of voters were supportive of many of the economic ties introduced in the first Ma presidency,” said Fell.

But changes both in Taiwan as well as the broader Indo-Pacific in the past 10 years will make it more difficult for China’s economic measures to sway Taiwanese voters’ behavior.

A tough environment for the KMT

Over the last decade, Taiwanese political identity and China’s foreign policy have changed in ways that have pushed some voters on the island toward the DPP, making China’s work in swaying voters to the KMT more difficult. As Taiwanese voters age, many report feeling less connected to the mainland, and more of a distinctive Taiwanese identity. China’s more assertive foreign policy under Xí Jìnpíng 习近平, and especially its systematic dismantling of any meaningful “one country two systems” arrangement in Hong Kong, have also undermined KMT efforts to woo supporters.

But less obvious dynamics on the ground in Taiwan are also combining to create an environment in which China’s economic coercion against agricultural producers may have less of an effect, according to Yu Ching-hsin 游清鑫 (Yóu Qīngxīn), a Research Fellow at National Chengchi University’s Election Study Center in Taipei.

Part of the KMT’s problem is that many of the profits from increased trade have gone to the exporters and middlemen in the agricultural trade space, while the DPP-supporting farmers and fishers often got the short end of the stick.

“There were profits, but they did not go to the front-line farmers and fishermen, but to the businessmen who already had close ties with the Kuomintang,” Yu told The China Project.

The DPP has also used rhetoric against Ma Ying-jeou’s warming to China, trying to convince voters in southern Taiwan that Ma was selling out the farming and fishing industries, and exposing them to future economic coercion from Beijing. While it was a cynical tactic on the DPP’s part, it also rang true for some agricultural businesses, especially those that had difficult interactions with mainland business entities, Yu said.

“The KMT has not responded to this DPP criticism, which is not all true, but not completely wrong either,” Yu added. “Instead, the KMT focused more on pushing a point of view with the people of Taiwan, saying that they should interact more closely with the mainland.” This tactic, Yu said, just gave the DPP more ammunition to point to the KMT’s efforts to grow closer to the mainland at a time when such moves were less and less popular.

The dynamics make for an environment in which it will be tough for China’s measures to siphon support among agricultural producers to the KMT. Some also argue that China’s moves could simply backfire. Instead of leading farmers and fishers to vote for the KMT in order to ensure healthy cross-strait ties, import bans may just make the voters view the mainland even more negatively, deepening their support for the DPP.

Support for farmers

As farmers and fishers face difficulties selling products to what is in many cases their most important market, the Tsai administration is attempting to deflect fiery KMT criticism by offering support in a variety of forms.

The Tsai administration has stepped in with subsidies and low-interest loans for some producers. Yi-Fan Chen (陳奕帆 Chén Yìfān), an assistant professor of diplomacy and international relations at Taiwan’s Tamkang University, said the subsidies would help soften any electoral blow the DPP might feel due to the bans.

“The government here in Taiwan has used a lot of subsidies to compensate the losses of the farmers,” he said. “So the farmers will still vote how they want, for whom they like, and for whichever party they prefer, instead of caring about their exports that much.”

It’s not clear how much Taiwan will subsidize farmers and fishers in total. In April, the Taiwanese Executive Yuan’s Council on Agriculture (COA) announced it would subsidize grouper producers to the tune of $26.92 million. The COA did not respond to a request for comment for this article.

In addition to subsidies, Taiwan’s government has provided some help in finding new markets for embattled farmers and fishers. Exports to Japan, South Korea, and the U.S. rose dramatically in 2021.

The takeaway

China is hoping it can sway voters in southern Taiwan’s DPP strongholds away from the pro-independence party and toward its preferred KMT. The prevailing winds are pushing against their efforts however, as a number of dynamics make defection of many DPP voters in the agricultural space unlikely.

Sources and additional data:

• Pineapples Are at the Center of Latest China-Taiwan Dispute / Bloomberg
• China Slaps Export Ban on 100 Taiwan Brands Before Pelosi Visit / Bloomberg
• China Slaps Export Bans on Taiwanese Goods – Again / The Diplomat
• China ramps up trade sanctions on Taiwan in wake of Nancy Pelosi’s visit, bans sand exports, fruit and fish imports / SCMP
• Leader From Taiwan’s KMT Starts China Trip as Beijing Ups Pressure / The Diplomat
• China resumes Taiwanese fish imports in sign of economic thaw, to ‘promote healthy cross-strait trade’ / SCMP
• Mainland China launches probe into Taiwan’s ‘trade barriers’ affecting 2,400 products / SCMP
• 中國再對台下柑橘與水產品進口禁令 國民黨立院團籲速恢復兩岸食安協議 / 台灣好新聞
• Taiwan’s Farm Exporters Look to Unlock New Markets / AmCham Taiwan
• The Role of Economic Issues in Taiwan’s 2024 Presidential Election / Global Taiwan Institute