Just before midnight on February 6, a plane carrying 247 Taiwanese evacuated from the Chinese city of Wuhan, the epicenter of the coronavirus outbreak, touched down at Taoyuan International Airport.
Among the passengers was one person who contracted the coronavirus, as well as scores of the evacuees’ spouses who are Chinese citizens. They were not on the evacuation priority list that Taiwan's government had provided to China. And all 247 passengers, at Beijing’s insistence, did not wear protective gear. Public anger erupted, and subsequent evacuation flight schedules were cancelled.
The controversy also exposed a controversial pro-Beijing figure: Hsu Cheng-wen(徐正文). Hsu, a Taiwanese businessman who is a member of the KMT’s (Kuomintang's) Central Committee and also an advisor to the Chinese Communist Party (CCP), also helps lead a Beijing-led organization that promotes unification of China and Taiwan. Hsu voluntarily acted as an unofficial mediator of this China-led evacuation because Beijing refused to negotiate directly with the Taiwan government, which it does not officially recognize.
The bungling of this evacuation and Hsu's double-faced role touched a nerve in Taiwan society. Meanwhile, a clip in which Hsu read excerpts from a book by China's President Xi Jinping(習近平) on governance emerged online. It reinforced not only Hsu’s image as a proxy for Beijing but also highlighted the KMT’s pro-China leanings. The KMT immediately suspended Hsu in response to public outrage and to distance itself from the CCP.
When Taiwan Profits From Political Isolation
This perfect storm explained the main reason why the KMT was battered in the presidential and legislative elections in January. And Hsu is but a symptom of a chronic disease within this hundred-year-old party, highlighting the predicament the KMT finds itself in under the current domestic and geopolitical climate.
Last year, Taiwan President Tsai Ing-wen(蔡英文)’s flat rejection of Xi’s “one country, two systems(一國兩制)” offer and her firm endorsement of the Hong Kong protests has led to her unprecedented public support in Taiwan and Hong Kong. After her election in 2016, Tsai and other members of the ruling Democratic Progressive Party have also cultivated close ties with Washington, during which Congress has passed pro-Taiwan legislation including the Taiwan Travel Act in 2018 and the TAIPEI Act this year.
In January’s elections, the KMT was punished by Taiwan’s voters for its pro-Beijing stance.
The party’s slow response to the “one country, two systems” furore, and cautious sympathy for the Hong Kong protesters have also given rise to criticism. Its presidential candidate, Han Kuo-yu(韓國瑜), gave the appearance of preferring China to the U.S., making people more suspicious. He met with a Beijing-appointed official, the director of the Liaison Office of the Central People’s Government in Hong Kong, during a visit to the city in early 2019. In a first for a Taiwanese presidential candidate, he cancelled a planned visit to the U.S. during the election campaign. The KMT appeared ever more distant from its big brother of the Cold War period.
And now, the coronavirus pandemic crisis has further boosted Tsai’s administration, which has been lauded by the international community for its competent and effective response.
With just less than 500 cases and 7 deaths in Taiwan from the virus, the international community has become more curious about the island’s success. Many analysts have noted that Taiwan benefited from its political isolation and distrust of China. Once considered a destabilizing force in the region, the pro-independence ruling party in Taiwan is now praised for its experienced China crisis management, while the KMT’s fortunes are seemingly at rock bottom given its unseemly close relationship with Beijing.
Red Scare in the Blue Party
Losing one election is not a crisis for the KMT, whose landslide victory in the 2018 local elections still reverberates. Blaming it on fickle voters alone cannot explain its roller coaster journey.
According to a 2020 election survey by Taiwan’s Academia Sinica, public polls showed that 72% of voters under the age of 40 supported Tsai. The approval rate for Han was 15% among the same demographic group, which was attributed to the younger generation’s disdain of the KMT due to its image as an agent of Beijing’s united front work.
The ageing KMT desperately needs support from the youth. According to internal data, the number of party members who have reached a full-year membership now stands at 345,000, with members under age 40 accounting for only 3.16% (less than 9,000) of the whole party.
When reform-minded members of the KMT contemplate the loss of an entire generation of Taiwanese youth, a profound question comes to mind: Has the KMT learned the lesson from its bitter history in China? It lost the entire Chinese mainland and has now lost Taiwan.
Hsu is not the lone figure to be seen as a red agent in the KMT. The influence of China on KMT politicians runs from the top leadership down to the grassroots.
But Hsu represents a typical interest group within the party, the “taishang”, or wealthy Taiwanese businessmen with vested interests in China.
There are an estimated 1 million taishang in China, and they are one of the most important sources of support for the KMT. The taishang operate well-organized associations in every Chinese province, and in every election, this community mobilizes members to return to Taiwan to vote for the KMT with cheap flights subsidized by Beijing. With anti-Beijing sentiment on the rise, they are increasingly suspected as being a proxy for Beijing due to their personal and business interests.
“Many KMT members have businesses or investments in China which has made Taiwanese people concerned about our China policy,” said Alfred Lin(林家興), a former head of the KMT Youth League. "It’s also the crucial reason why a lot of young people are not willing to join the KMT."
Lin, now an editor at New Public Report, an independent think tank in Taiwan, has discussed with young KMT members about ways to wean the party off influences from the CCP. Their goal: prevent the “red unification forces” from seeping through the party.
Kuang Bo-teng(匡伯騰), a 37-year-old lawyer and KMT member, is also very concerned about the party’s image of being “Beijing's agent” in Taiwan. “If the new [KMT] chairman only talks but does little to reform, no one could save this party anymore.”
It's the first time that the issue has been discussed so publicly within the party. For years, the KMT has rejected being labelled as a “red proxy” but now it has no choice but to face the rising criticism squarely, especially growing calls for action to clean the party from its young members.
During the chairman's by-election campaign on March 7, newly elected KMT Chairman Chiang (江啟臣), a 48-year-old rising star and incumbent legislator, echoed this sentiment from young members that “those who want to use KMT to do business must quit.” His rival, the former Taipei mayor, also said the KMT must tackle the corrupt business culture within the party.
“The KMT was reluctant to face this problem but its changed attitude is a sign that the party has realized that it barely wins the trust of Taiwan's voters due to its pro-Beijing political and economic network,” said Wu Jieh-min(吳介民), a senior researcher at the Academia Sinica in Taiwan. He is an expert on the impact of China's Sharp power and united front policies in Taiwan, and a longtime observer of the influence of this network related to KMT’s cross-strait policies.
The Pro-Beijing Network: As Many as 40% of KMT Central Committee Members Have Business Interests in China
Then, how big exactly is the pro-Beijing network within the KMT?
Speaking on background, multiple KMT members from different groups and generations say that the party has far too many “panda-huggers,” especially in the Central Standing Committee (CSC), the top decision-making body of the party. They add that it would be a tough mission for the new chairman to tackle these interests.
One senior source in the KMT leadership estimates that around 1/4 members of the CSC have businesses in China. However, in an investigation with the New Republic Report, we found that the real number exceeds that.
According to open sources from the KMT website and election materials, we conducted background research on the KMT CSC. The CSC has 39 members, 32 of which are elected by Central Committee members, with the term limit extended from 1 year to 2 years. We found that over a 10-year period (2009-2019) the proportion of members who have economic ties in China increased from 22% to 47%.
Between 30% and 40% of CSC members during every term (over 9 terms in 10 years) had a "cross-strait background" — they were either taishang or prominent members of associations promoting cross-strait relations. Most notably, there has been an uptick in this trend in recent years. Between 2009 and 2012, the proportion had been 22%-33%. In 2013, it shot up to 44%. Among the latest CSC members, 47% have business ties with China.
We also found that among 26 who served for more than five terms, 12 of them are taishang — almost half. Among the larger Central Committee, 40 of the 210 members have China connections.
They can generally be classified as the following:
More and more taishang participate in the party’s decision-making body, making this group one of the influential forces inside the party when electing the party chair. There were 10 among the 2019 CSC, double the number from 2009. The recently retired acting chairman of the KMT, Lin Rong-de, is a prominent taishang.
- Associations promoting cross-strait relations
Cross-strait relations have prospered since the victory of KMT candidate Ma Ying-jeou in Taiwan’s 2008 presidential election, after which many associations have sprung up in the name of “cross-strait exchange." By taking a role in those associations, many KMT members are able to interact with high-ranking CCP officials.
According to one KMT Taipei city councilor, prior to Xi’s anti-corruption campaign, as many as hundreds of Chinese officials would visit Taiwan, with “visit fees” ranging from 30,000-50,000 RMB ($4500-$7000 USD). Some KMT members maintained good relations with the CCP in order to profit from the business brought by high-ranking Chinese officials’ visits to Taiwan, which they outsourced to travel agencies.
- Agricultural product agents
Some KMT members have secured rights to sell Taiwanese agricultural products to China since 2005. According to well-informed insiders, those who have become agents in promoting agricultural trade across the strait also profit from certifying agricultural products sold to China.
- Financial investment and culture incubators
In 2018, Beijing announced the “31 Policy Measures to Benefit Taiwan,” a slate of subsidies to attract Taiwan young people working or having a startup in China. There are 75 incubators established for Taiwanese across China. Subsequently, some KMT politicians received permission to run the incubators. They act as recruiting agents to introduce Taiwanese talent to China.
Yesterday’s Rival, Today’s Partner
Historically, the KMT had had a very intricate relationship with the Chinese Communist Party (CCP).
The two rivals cooperated twice from 1920 to 1950 — the first was against the warlords of northern China and the second was against Japanese invasion. In between those episodes, the CCP made inroads infiltrating the KMT, prompting Chiang Kai-shek(蔣介石) to spearhead a violent purge of Communists inside the party. But it did not prevent the KMT’s eventual loss to the CCP in the Chinese civil war.
After retreating to Taiwan in 1949, Chiang Kai-shek was bent on preventing Communist infiltration of Taiwan. He and his son, Chiang Ching-kuo(蔣經國), purged political dissidents in a sweeping campaign known as the White Terror that lasted for almost four decades, ending in 1987. The end of the White Terror and martial law was followed by Taiwan’s democratization and the emergence of a local Taiwanese identity.
So how did the KMT evolve from anti-communism to a party that is pro-Beijing?
The turning point was the reconciliation between the KMT and CCP in 2005, when then-KMT chairman Lien Chan (連戰) made a historic ice-breaking visit to China.
One needs to look back to the presidential election in 2000 when the opposition DPP’s Chen Shui-bian (陳水扁) made history by ending the KMT’s half-century of rule in Taiwan. In 2004, Lien Chan ran for the island’s top office, but failed to return the presidency to the KMT. After this major loss, Lien turned his attention to China.
At around that time, China’s entry into the WTO in 2001 elevated its global stature both economically and politically, and many countries around the world wanted to bolster diplomatic ties with Beijing. Lien's KMT also found a burgeoning new role in cross-strait relations in this context.
Lien embarked on a “peace journey” to China in April 2005. He met then-CCP general secretary Hu Jintao(胡錦濤), the highest-level meeting between the KMT and CCP since Chiang Kai-shek and Mao Zedong(毛澤東) met in Chongqing in 1945.
Both of these parties, united by a broader Chinese nationalism, came together to work against Taiwanese nationalism. They saw the Taiwan-born DPP as a common enemy, prompting the two rivals to forget their long history of animosity. Lien and Hu’s handshake represented the end of a 45-year confrontation between the two sides, and the Lien-Hu meeting was hailed as a breakthrough “achievement of Chinese across the strait.”
It was reminiscent of the CCP’s classic co-opting strategy toward the KMT, deploying so-called "united front" tactics —that helped Mao Zedong win over mainland China from the KMT during the 1940s. The core spirit of united front tactics is to befriend a smaller enemy in order to confront a larger one. This approach, invented by the former revolutionary and leader of the Soviet Union, Vladimir Lenin, was well-practiced by Mao and broadly implemented as part of China’s foreign policy to expand its influence beyond its borders. It is often referred to in the West as China’s “sharp power.”
The KMT-CCP rapprochement also coincided with a globally optimistic mood regarding China's development and warming U.S.-China relations. Compared to the DPP president Chen, who was seen as a "trouble-maker," the KMT was viewed as being on the right side of history.
The push for a win-win cross-strait relationship intensified in 2008 when the KMT’s Ma Yingjeou clinched the presidency. He unleashed a flurry of policies to build closer ties with China including launching more direct flights, increasing commercial exchanges, and hosting more frequent official visits. Over the past 15 years, more and more high-ranking KMT figures established or expanded investment or business projects in China with special privileges and preferential policies from the CCP.
On the other hand, according to sources, many Chinese officials also saw an opportunity to reap the economic benefits and even demand kickbacks for investment approval. An intricate network of political and business interests across the strait began to form.
The CCP offered the KMT not only vastly expanded personal business interests in China but also a relatively looser diplomatic space (Taiwan was granted World Health Assembly observer status during Ma’s time in office, but lost it after Tsai and the DPP took power in 2016). Furthermore, at its peak, more than 4 million Chinese tourists visited Taiwan in 2015, almost 40% of all foreign visitors that year. In 2012, a number of wealthy Taiwanese who had huge business stakes in China expressed their support for the 1992 Consensus before the voting day, enabling Ma to secure his re-election as Taiwan’s president.
In the 11 years between 2005 and 2016, when President Ma met Chinese leader Xi Jinping in Singapore, the KMT was at ease dealing with both Beijing and Washington. “Taiwan must rely on China’s kindness” became the KMT’s diplomatic and economic guiding principle.
Since Lien’s 2005 visit to China, the KMT's cross-strait policies have been shaped more by economic considerations than by aspirations for unification. At the time, such a mindset was largely aligned with mainstream sentiment in Taiwan. But after Xi adopted more aggressive Taiwan and foreign policies in 2013, trepidation in Taiwan and the international community towards China’s assertiveness has grown.
Critics point out that Beijing has in recent years been flexing its sharp power to expand its political influence outside China. Meanwhile, the cross-strait economic relationship has shifted from a complementary dynamic to a competitive one. There is a growing sense that Taiwan's reliance on the Chinese market risks undermining its political independence. Moreover, the political identity of Taiwanese has changed profoundly.
A steady trend in polls shows that an estimated 60% of Taiwanese do not want to be unified with China (including those who are pro-independence or merely wish to maintain the status quo). There has been a realization that Beijing’s prerequisite for closer economic ties is unification.
Democratic values and Taiwan identity are on the ascendancy in Taiwan but the KMT has stressed economic benefits while turning a blind eye to political risks, rendering itself too susceptible to Beijing’s influence.
The KMT is to Beijing, what perhaps Icarus was to the sun. In Greek mythology, Icarus flew too close to the sun and ended up falling from the sky when his wax wings melted from the heat.
A Tool in the CCP’s United Front Toolbox
A former senior KMT official observed that the CCP granted the KMT special treatment in hopes of bolstering the prospects of unification. More KMT politicians developed business stakes in China, while ordinary businessmen joined the KMT to maximize their commercial interests. Over time, the KMT ended up influenced by those interest groups and veered further from the orbit of mainstream opinions.
“At least half of the Taiwanese believe that China is not a friend but a foe. Therefore, the KMT’s intricate relationship with Beijing and its economic ties in China ultimately took on a political, rather than legal dimension," the political scientist Wu Jieh-min said. "People will ask where the KMT stands when it comes to choosing between personal interests and national security.”
Wu said that Beijing sees the KMT as a useful tool to implement its unification plan. Once the KMT is no longer politically relevant, its value to Beijing will be significantly lower. The biggest challenge for the new chairman of the KMT, Johnny Chiang, is to reduce his party’s reliance on Beijing.
In addition, the KMT has an Achilles heel.
When Tsai Ing-wen’s DPP government wrested back power from the KMT in 2016, it transferred what it deemed to be the KMT’s ill-gotten wealth —7 billion Taiwanese dollars — to the state coffers. According to people familiar with the situation, the party’s monthly running costs of about NT$300 million (US$10 million) are mainly covered by political donations from Taiwanese businesspeople. Some within the party worry that Beijing will use their reliance on this capital from the Taiwanese businessmen as leverage to influence the KMT.
“Will the CCP take the opportunity to use it to its advantage? These influences are usually invisible. The weaker the KMT is, the more red it becomes. The more red it becomes, the weaker it gets. It’s a vicious circle,” said a senior KMT advisor specializing in cross-strait affairs.
The advisor observed that most Taiwanese businessmen just want peaceful cross-strait relations because it would benefit their businesses, but some do have ambitions to influence the party's policies. The anti-Beijing sentiment of the party reformists also upsets some Taiwanese businessmen representatives within the party. They prefer a "one country, two systems" arrangement like China has with Hong Kong, which is not the stance of the KMT.
The KMT needs more donations from individual supporters, but more importantly it must regain the trust of Taiwan society. If it relies only on taishang, it will fuel more public distrust. It would be like drinking poison when one is thirsty.
The Party Is Over, Pro-China or Not, That’s the Question
After 1949, when the Nationalists fled mainland China to Taiwan, the animosity between the KMT and CCP has defined a triangular relationship between Washington, Beijing and Taipei, with ramifications for the broader region. Now, a new era of strategic competition and growing tensions between the U.S. and China has put the KMT in an awkward position.
When U.S.-China relations were good, the KMT could gain advantages from both sides. Now, it’s not easy for the KMT to hedge, while the two superpowers are more confrontational after the trade war and coronavirus outbreak. The party is over.
The KMT finds itself in a prisoner's dilemma: In order to keep its economic interests in China and to maintain its exclusive relationship with Beijing, it is reluctant to offend Beijing, which has led to growing distrust and disdain from young Taiwanese.
According to a recent poll, 80% of Taiwan’s youth (under 29) identify themselves as Taiwanese not Chinese. On the other hand, while the DPP and Taiwanese identity gains more traction, the KMT's failure to retain power has also earned China’s scorn. Anxious KMT supporters, caught between commercial interests and Chinese nationalism, will lean towards China.
A KMT advisor specializing in cross-strait affairs observed that the CCP upholds the principle of real power, and that the KMT must likewise do the same in regaining its public support.
“We must prove our capacity and pay less attention to whether Beijing is happy or not.”
But some within the KMT disagree. Ma Shao-zhang (馬紹章), a former high-ranking cross-strait official of the Ma Ying-jeou government (Vice President of the Straits Exchange Foundation), says given the uniqueness of cross-strait relations, it requires trust before any negotiation.
Will this attitude adjustment by the KMT upset Beijing and worsen cross-strait relations, potentially destabilizing the region?
"My guess is that the KMT will try to walk a fine line, attempting to refine its policy on cross-strait relations sufficiently to win more support from voters, while not derailing its relations with Beijing," said Bonnie S. Glaser, a senior advisor for Asia at the Center for Strategic and International Studies in Washington.
The KMT has argued that it can manage relations with mainland China more effectively than the DPP because it retains communication channels with Beijing. That objective will be difficult to achieve, but not impossible, added Glaser.
Unification, Independence, or the Status Quo?
The crux of the problem is that despite its Chinese roots, the KMT has existed and evolved in Taiwan for seven decades. Because of this, the KMT still gained support from 40 percent of Taiwanese voters in the last election, begging the question: where do they want to take Taiwan?
Johnny Chiang, the new KMT leader, advocated for a return of the spirit of 1992 Consensus in which the disputed issues over sovereignty will be put on hold so that more practical issues could be dealt with. Along with it, he also called for China to become more democratic.
“It’s fate that Taiwan cannot escape its proximity to China,”said Ma Shao-zhang, who was instrumental in planning Lien Chan’s maiden visit to China in 2005. “We can use our imagination towards unification, and not necessarily see it as taboo."
“It means the KMT could accept 'ROC (Republic of China), Taiwan,' which was proposed by President Tsai. In the meantime, the KMT can still pursue a vision different from the DPP.”
Ma’s views are in line with those of Alfred Lin and some KMT members who are enthusiastic about the party's history in China. They believe the KMT should oppose the CCP and authoritarianism, an approach aimed at defending a democratic Taiwan and a free China.
Will the idea of the unification with a democratic China still find resonance in Taiwan? After Hong Kong's painful lessons of blood and tears, it remains to be seen. But one thing is for sure: in the midst of a strengthening Taiwanese identity, growing unification pressure from Xi Jinping, and deteriorating U.S.-China relations, the KMT does not have much wriggle room to find the right balance.
“Why is the DPP more concerned about the democratic and human rights issues of China and Hong Kong?” said Kuang Bo-teng, a 37-year-old lawyer and a KMT member. “The KMT should export democracy to China, but now it’s importing authoritarianism back to Taiwan.”
“If the KMT always stands by the Chinese Communist Party, every time cross-strait tensions rise, people will naturally suspect our belief and affiliation. We must not look like the Taiwan branch of the Chinese Communist Party.”
The read the Chinese version, please click: 〈站在反共和親中的十字路口，國民黨如何面對內部的「中國因素」？〉.
（NOTE: New Republic Report contributed to this article）