China Responds to Taiwan’s Presidential Election: Is Beijing Biding Its Time?

On January 13, William Lai of the ruling Democratic Progressive Party (DPP) won Taiwan’s presidential election with forty percent of the vote, edging out his two opponents. At the same time, the DPP failed to retain its majority in Taiwan’s legislature, losing ten seats and falling behind the opposition Kuomintang (KMT) by one seat (52 to 51). Focus will now shift to the balance of power in the legislature, which will convene next month to elect a new speaker. The Taiwan People’s Party (TPP) holds eight seats and emerged from the election as a potential kingmaker that can either work with the DPP to shape and advance Lai’s agenda or align with the KMT to stymie many of Lai’s policies. 

China’s reaction to the results has thus far been relatively restrained, as Beijing had likely already assessed that a Lai victory was the most probable outcome and took solace in the DPP losing the legislature. In addition, China is likely prioritizing U.S.-China relations over its cross-strait ambitions in the near term. Nonetheless, one should expect China to exert more pressure on Taiwan over the next five months to demonstrate to the Taiwanese people that there is a price for continuing to vote the DPP into power and to attempt to shape Lai’s inaugural address and his approach to cross-strait relations. 

China Responds to Lai’s Victory 

Thus far, China’s response to Taiwan’s election has been to downplay its significance, repeat well-worn talking points, and attempt to turn the page. A spokesperson for China’s Ministry of Foreign Affairs asserted the election “will not change the basic fact that Taiwan is part of China and there is only one China in the world,” while the Taiwan Affairs Office’s spokesperson said the “election cannot change the basic pattern and direction of cross-strait relations.” China’s statements have also emphasized the inevitability of unification, conveying the message that Beijing is taking the long view and attempting to sow resignation among the Taiwanese people. 

China’s first and most notable move following the election was its poaching of one of the thirteen countries that still maintain formal diplomatic ties with Taiwan, a tactic that Beijing often uses to register its displeasure with developments in Taiwan. Just after the election, Nauru announced that it would sever ties with Taiwan and establish relations with China. This increases Taiwan’s international isolation but is not a body blow, as Taiwan’s unofficial relationships (such as those with the United States and Japan) are far more important than these official relationships, even though they still confer benefits on Taipei. 

Interestingly, while China continues to conduct military activities in Taiwan’s self-declared air defense identification zone, it has not yet dramatically increased their scale. This could be due in part to recent internal turmoil in China’s People’s Liberation Army. At the same time, the absence of major military exercises is further evidence of Beijing taking a “wait and see” attitude and preserving this tool for future use, potentially following Lai’s inauguration.  

The initial, relatively restrained response is likely a result of a few different factors. First, China is seeking to ease tensions with the United States in the short term as it deals with increasing economic headwinds. It may have concluded that a forceful response to Taiwan’s elections would prompt the United States to counter by demonstrating more support for Taiwan and would also lead to more calls to impose controls on trade and investment with China.  

Second, with less than one year until the U.S. presidential election, China is likely willing to play the long game in anticipation of a second Trump presidency that could see the United States dial back its support for Taiwan. Trump has blamed Taiwan for stealing the United States’ semiconductor industry, reportedly questioned what the United States would gain from defending Taiwan, and repeatedly praised Chinese leader Xi Jinping. China could be wagering that it can entice Trump into a deal that addresses his narrow concerns on trade in exchange for a reduction in U.S.-Taiwan cooperation. 

Third, in his victory speech Lai underscored his commitment to maintaining the status quo in the Taiwan Strait and his openness to dialogue with China, thus not providing an opening that China could exploit to paint Lai as a provocateur who forced Beijing’s hand. Lai stated, “As President, I have an important responsibility to maintain peace and stability in the Taiwan Strait. I will act in accordance with the Republic of China constitutional order, in a manner that is balanced and maintains the cross-strait status quo. Under the principles of dignity and parity, we will use exchanges to replace obstructionism, dialogue to replace confrontation, and confidently pursue exchanges and cooperation with China.” 

Fourth, and most important, the results of the election were not Beijing’s worst-case scenario. Although Lai’s victory will extend the DPP’s rule to twelve years (since Taiwan held its first presidential election in 1996 neither the KMT nor DPP has won three consecutive elections), Beijing has emphasized the fact that sixty percent of voters chose someone else. China’s Taiwan Affairs Office, for instance, noted that the election reveals the “DPP does not represent the mainstream public opinion.” In addition, Lai received 2.5 million votes less than Tsai received when she ran for reelection in 2020 and the DPP lost control of the legislature. Unless the DPP can convince the TPP to support its policies, Lai will find it difficult to govern for the next four years. For China, a divided government in Taiwan that is dysfunctional and demonstrates to the Taiwanese people that democracies cannot deliver for their people would be a favorable outcome. 

Looking Ahead 

While its initial response has been relatively mild, China will likely exert additional economic, military, and diplomatic pressure on Taiwan in the months ahead. On the same day that the DPP chose Lai as its presidential nominee, China launched a trade investigation into Taiwan, and less than a month before Taiwan’s election it sent a warning shot by announcing that it would increase tariffs on some Taiwanese products. Beijing will likely continue to undo the Economic Cooperation Framework Agreement, which the two sides signed in 2010, by raising tariffs on Taiwanese goods, erecting regulatory barriers, and potentially imposing investment restrictions. China will also likely seek to normalize military activity closer to Taiwan’s shores. Diplomatically, it could choose to poach another one of Taiwan’s “diplomatic allies” and will continue to use its influence to bar Taiwan from participating in international organizations.  

China will also seek to divide Taiwan and polarize Taiwanese society by isolating the DPP and rewarding pro-China businesses, civic organizations, and politicians. Using both carrots and sticks is nothing new for Beijing, but China will continue to refine this approach. In an article published after Taiwan’s elections, Xi emphasized the need to “develop and strengthen Taiwan’s patriotic, reunification forces.” China’s Ministry of State Security, meanwhile, warned that the 2005 Anti-Secession Law is a “sharp sword” but it is aimed only at “secessionists” and not at Taiwan “compatriots.” Beijing will attempt to use its influence to make Taiwan ungovernable and to raise doubts within Taiwan as to the value of democracy and the price of continued estrangement. 

Some may argue that with unification further away than ever and the DPP set to retain the presidency for twelve consecutive years there should be some soul searching in Beijing regarding its Taiwan strategy. Instead, China will continue to employ a variation of the same strategy it has used for years, one that it is comfortable with and that plays to its strengths. The increased pressure will push Taiwan further away from China and unification will fall further out of reach.