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Hi Intriguer. When I visited Taiwan in July last year for a wargaming exercise, I was blown away by three things.
The first was the superiority of Taiwan’s pineapple cakes. The second was Taiwan’s ability to pump out 90% of the world’s advanced semiconductor chips. And the third was how certain everyone seemed about the ruling DPP winning a third term at the 2024 presidential election.
One taxi driver told me that just ten years ago, some Taiwanese still felt optimistic about peacefully coexisting with China under President Xi, but that’s now changed because of Xi’s “flexing”.
I think this weekend’s presidential results showed just how determined Taiwan is to chart its own course. Let’s dig into it for our top story today.
– Helen Zhang, Co-Founder
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Davos kicks off. Political and business elites (and our very own Helen) are gathering in the Swiss town of Davos for this week’s World Economic Forum meeting. A survey of 60-plus chief economists released in conjunction with Davos claims over 50% believe global economic conditions will weaken this year.
China’s central bank holds firm. The People’s Bank of China has left a key interest rate unchanged, defying expectations of a first cut since last August. China’s financial authorities are potentially worried about cutting interest rates too quickly and weakening the yuan against a strong USD.
Republican Iowans to vote amid a storm. Former President Donald Trump is widely expected to win today’s Republican presidential caucuses in Iowa. Nominees are urging supporters to brave the unprecedented -24°C (-11 F) temperatures to vote in the first official event of the 2024 US presidential election.
IMF warns AI could affect nearly half of all jobs. A new report by the IMF warns that up to 40% of jobs around the world could be impacted by artificial intelligence (AI). In advanced economies, the IMF puts that number at 60%.
TOP STORY
Taiwan votes for continuity with accountability
Taiwan’s President-elect Lai Ching-te (L) and his running-mate Hsiao Bi-khim (R), who was previously Taiwan’s top representative in Washington. Credits: Louise Delmotte, AP
Largely as expected, Vice President Lai Ching-te (aka William Lai) won Taiwan's presidential elections on Saturday with 40.1% of the vote, earning his ruling Democratic Progressive Party (DPP) an unprecedented third consecutive term.
The Harvard-educated former doctor and mayor will replace outgoing President Tsai in May.
Voters were concerned about familiar issues like housing and wages, but the dominant theme was, of course, China. That’s inevitable when your nuclear-armed neighbour and top trading partner considers you a breakaway province.
But China was also front of mind because China wanted to be front of mind, calling the election a choice between war and peace, and Lai a dangerous separatist. It was all aimed at limiting Taiwan’s options and shaping its choices.
Still, Lai gave a pretty measured victory address on Saturday night, vowing to "replace confrontation with dialogue" but also to "safeguard Taiwan from continuing threats and intimidation from China".
And the world's responses have been pretty predictable, too:
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🇨🇳 China reiterated its opposition to "separatist activities", while relishing the fact that Lai's party lost its legislative majority
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🇺🇸 The US congratulated Lai and sent an unofficial delegation to Taiwan in line with past practice
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🇷🇺 Russia reaffirmed its view that Taiwan is an integral part of China, prompting Taiwan to accuse Russia of becoming “a thug of the Chinese Communist regime” (🔥🔥🔥), and
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🌏 Others (like Japan, France, the UK, and the EU) welcomed Taiwan's elections, prompting varying degrees of pushback from Beijing.
After years of being conditioned to expect bold electoral plot twists and wildly inaccurate polling, this whole exercise has been refreshingly predictable to date.
INTRIGUE’S TAKE
So… what can we expect from President Lai and China in the months ahead?
Lai once called himself a "pragmatic worker for Taiwan independence" (hence China's ire), but he's moderated his stance as vice president and is promising more of the same as president. This moderation is aimed at:
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preserving stability with China
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assuaging Taiwan’s backers in the US, and
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reassuring a Taiwanese population spooked by crackdowns in Hong Kong, Russia's invasion of Ukraine, and a more confrontational China.
As for China, it continues to see Taiwan as a red-line issue because of what Taiwan is (a visible example of defiance), where it is (right in China's grill), and what Taiwan has (dominance across advanced semiconductor manufacturing).
So China will reassert its claims over Taiwan, but it also needs to nurture US-China stability while addressing its own mounting challenges back home.
This means we can expect China to pressure Taiwan, but without rocking the boat too much. And one example has just emerged, with reports China has poached one of Taiwan’s 12 remaining formal diplomatic partners: the tiny Pacific Island nation of Nauru.
But all in all, this election extends the increasingly fragile status quo:
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Taiwan continues to function like an independent country, but without formally declaring independence
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The US continues to function like Taiwan’s ally, but without formally promising to defend it, and
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This all leaves China with just enough hope for peaceful ‘reunification’, but just enough unease to continue its vast military modernisation.
Also worth noting:
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Taiwan’s more Beijing-friendly Kuomintang opposition came second with 33.5%. A relatively new third party attracted support from younger voters, winning 26% of the vote.
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China exercised varying degrees of control over Taiwan for ~200 years until 1895, while the modern day People’s Republic of China has never controlled Taiwan. Interestingly, early Chinese Communist Party statements actually called for Taiwanese independence (from Japan).
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MEANWHILE, ELSEWHERE…
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🇰🇵 North Korea: Pyongyang launched at least one ballistic missile into the waters off the Korean peninsula yesterday (Sunday). In parallel, there are reports North Korea has suddenly halted broadcasts from a radio station it uses to send messages to its spies over the border.
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🇩🇰 Denmark: The Danes yesterday welcomed a new King, Frederik X, after his mother abdicated. King Frederik is married to an Australian (Queen Mary) and has adopted ‘United, committed, for the kingdom of Denmark’ as his royal motto.
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🇲🇻 Maldives: President Mohamed Muizzu has asked India to withdraw its military personnel from the Maldives before a 15 March deadline, delivering on one of his campaign pledges. India has 89 troops stationed in the country for aircraft patrol missions.
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🇬🇹 Guatemala: After an eventful weekend including legislative wrangling and a last-minute curveball from Guatemala’s top court, anti-corruption crusader Bernardo Arévalo was sworn in as president overnight. The lengthy delay meant Chile’s president missed the inauguration as he had to fly home.
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🇪🇬 Egypt: President Abdel-Fattah al-Sisi and Chinese Foreign Minister Wang Yi have met in Cairo for talks over the weekend. They called for a ceasefire in Gaza and an end to attacks on civilian ships in the Red Sea, with Wang adding indirectly that US-UK airstrikes against Houthi targets added “fuel to the fire”.
EXTRA INTRIGUE
🤣 Your weekly roundup of the world’s lighter news
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Canadian park authorities are warning drivers not to let moose lick their cars.
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A Welsh man has solved the mystery of who’s been tidying up his shed every night: a mouse.
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A study conducted by an 8-year-old Australian attracted over 30,000 participants and concluded that magpies (a bird) perceive balding men as more of a threat than longer-maned folks.
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Candy company Haribo has broken a world record by creating a 32.5 square metre (350 square foot) gummy bear mosaic.
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And in a contest organised by a Swedish town, an Australian woman has been awarded the first-ever ‘World’s Ugliest Lawn’ award.
RANKING OF THE DAY
Credits: Henley & Partners.
Passport power
For the first time, six countries now share the title of ‘world’s strongest passport’. Citizens of France, Germany, Italy, Japan, Singapore, and Spain can all enjoy visa-free travel to 194 destinations, a new record. In last place sits Afghanistan, whose citizens can only visit 28 locations visa-free.
DAILY POLL
Where do you see things headed between Taiwan and China? |
Last Thursday’s poll: How should other countries help Ecuador?
🟩🟩🟩🟩🟩🟩 ⛔ Staying out of it is often the best course of action (33%)
🟨⬜️⬜️⬜️⬜️⬜️ 💰 Sending aid (10%)
🟨🟨🟨🟨🟨🟨 🧑💼 Sending technical support (31%)
🟨🟨🟨🟨⬜️⬜️ 🔫 Sending materials and personnel on the ground (22%)
⬜️⬜️⬜️⬜️⬜️⬜️ ✍️ Other (write in!) (4%)
Your two cents:
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⛔ D.N: “It is best to put aside the concept of acting as ‘World Policeman’ forever. People everywhere need to solve their own problems.”
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✍️ B.O’C: “There have been interesting theories for some time about what would happen to the organised drug cartels if cocaine were to be decriminalised/legalised and regulated.”
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✍️ D.E.R: “Ask Ecuador what kind of help they would welcome.”