Neutrality for Taiwan? Why It Remains an Option

cc Flickr 總統府, modified,

The entry of the Taiwanese delegation in the opening ceremony of the Beijing Winter Olympics on February 4 served again as a reminder of the largest dilemma plaguing international relations in East Asia today. As the Guardian aptly reported, its “athletes had to march under a banner saying Chinese Taipei and a neutral flag.” De facto, Taiwan is an independent state, but de jure, it is not recognized as such due to Beijing’s staunch refusal to see the island go its way. However, political forces in Taiwan imagine this Olympic “neutral compromise” to serve as a model for a solution with the mainland.

The core of the issue boils down to an unresolved Second World War conflict. After a bloody civil struggle between the nationalists and the communists that lasted until 1949, Chiang Kai-shek, who led the Republic of China (ROC), retreated to Taiwan, while Mao’s People’s Republic of China (PRC) won the mainland. In 1971, the PRC replaced the ROC as China’s official representative in the United Nations, leading to a steady downturn in states recognizing Taipei as the official seat of China. Today, only 14 countries still maintain diplomatic relations with Taipei. Beijing demands reunification, but, according to recent opinion polls in Taiwan, over ninety percent of Taiwanese oppose the idea. Many social movements in Taiwan seek its independence, but that contradicts China’s core interest, to the point that the PRC threatens cross-strait warfare should Taipei dare to officially declare itself independent.

To find a compromise, in 2014, Annette Lu (Lu Hsiu-lien), Taiwan’s vice president from 2000 to 2008, and the former iconic democracy activist created a peace and neutrality proposal for a national referendum. Taiwan’s citizens were to vote if their government should declare “peaceful, permanent neutrality” while maintaining friendly relations with the U.S., Japan, and China, without touching the sovereignty question at all. The latest update on the Taiwanese proposal occurred during a National Referendum Hearing on May 9, 2019, where Lu ensured that this neutrality proposal would not necessitate an amendment to the constitution since it does not involve “constitution, sovereignty, and change of territory.” Instead, Lu holds it would only create a series of diplomatic policies that could lead to a way out of the impasse with China.

Interviewed about her proposal, Lu confirms that it has nothing to do with the independence movement and that she views Taiwan as powerful enough to “maintain the status quo and balance” in the US-China rivalry. Her rationale is that a neutral Taiwan would free China from the worry of an American military attack and eliminate the need to incorporate the island militarily. Meanwhile, a neutralized but strongly armed Taiwan (like Switzerland) would “strengthen the friendship with the U.S. and contribute to arms purchases from the States.” Whether Xi Jinping’s China (or Washington for that matter) would agree to such an arrangement remains dubious, but Lu’s ambition goes even further. She recently drafted an initiative for a “Chung-hwa Federation” (Chung-hwa referring to cultural and ethnic Chinese) for the ROC to coexist with the PRC in a European Union-like system. This initiative maintains Taiwanese autonomy while formalizing a state-to-state relationship with China.

Opinions inside Taiwan regarding Lu’s neutrality proposal are ambiguous. Some prominent voices have spoken in favor of the idea, like Chang Chun-hung, the former president of Straits Exchange Foundation, and Li Ming-Juinn from Taiwan Society of Japan Studies. Others, however, insist that the proposal must include provisions for de jure independence, like Shih Cheng-Feng from the National Dong Hwa University to prevent what he calls “a fake neutrality” from gaining domestic support. Similarly, Cheng Ch’in-Jen from National Taiwan University believes that Taiwan must “strive for national status first” in order to become permanently neutral.

Internationally, observers remain skeptical, too. Media outlets from mainland China suspect that Lu’s neutrality proposal would make Taiwan an independent state, ultimately, via the referendum. Yan Jun, the Deputy Secretary-General of China’s Taiwan Research Association (the largest official research institute under Taiwan Affairs Office of the State Council), commented that only a country could declare neutrality effectively, and therefore, Lu’s neutrality proposal amounted to an independence proposal by another name. The Taiwan Affairs Office of the State Council, too, replied to Lu’s proposal, first in 2014 and a second time in 2019, consistently framing the proposal as “Taiwanese independence” and a separatist plot.

Western voices have not been more accommodating. Michael Cole, from the Taiwan Sentinel, thinks the proposal to be “naïve.” Independence proponents like him view Beijing’s disagreement with Taiwan not as stemming “from Taipei’s security relationship with the U.S.” but rather from “Chinese expansionism” in Asia, which means Taiwanese neutrality would infuriate PRC China. Besides, a neutral Taiwan also contradicts American security thinking. As a democratic community in East Asia, Taiwan is usually regarded as a crucial “chokepoint” of the first island chain (Japan, Taiwan, the Philippines), blocking China’s free access to the Pacific. Under this thinking, a neutral Taiwan might “destabilize the entire region.” Therefore, western policy hawks view the proposal as a dangerous suggestion that might break the security balance in the Taiwan Strait and lead to warfare.

However, Lu is optimistic about her idea, maintaining that a neutral Taiwan “could create values that are too great to be ignored.” She sees hope for the proposal in Taiwan, mainland China, and the international arena. Talking about the island’s two largest political parties, she says that “both DPP and KMT supporters give positive feedback […] Many of those who do business in Mainland consider neutrality a good idea.” Hence the ever-busy former vice president plans to hold a “grass-root National Affairs Conference for Peace and Justice” this year to create a new consensus among the mainland and Taiwan, replacing the “outdated” 1992 Consensus.

It is questionable if Lu’s assumptions are realistic. Firstly, the logic of her proposal is contradictory. When Lu restated in the interview that this proposal is not relevant to Taiwanese independence, she also mentioned her fundamental conviction that “Taiwan is an independent state, with or without recognition.” This controversially reflects the local political dilemma that despite more than ninety percent of Taiwanese refusing unification and over thirty percent supporting independence, the international situation makes any change in the island’s foreign relations highly problematic. The reluctance to give up the prerequisite of Taiwanese independence shows that neutrality might indeed be just another jargon for the same thing—at least as perceived in Beijing. When independence is a hidden condition in the neutrality proposal, becomes a non-starter for China, due to Beijing’s Anti-Secession Law. On the other side, the United States generally prefers the status quo for Taiwan. That is, neither does the island become independent nor a part of China.

Besides, Taiwan as an unrecognized state has little power to change the outcome of the US-China rivalry. Politically, Taiwan lost its voice in international politics in the 1970s. Economically, while Taiwan is home to booming technology industries such as semiconductor chips, it only sports a 0.6 trillion GDP in 2021, compared to the 19 trillion of the U.S. or the 12 trillion of China.

In addition, one should not forget that for China, Taiwan has both strategic and ideological value. Geostrategy is but one of Beijing’s concerns. China’s ideological commitment to reclaiming Taiwan is a policy mantra that stems from its growing nationalism. Recovering Taiwan is one of the most important political tasks in China’s national rejuvenation, and President Xi Jinping believes that such rejuvenation is “a historical inevitability.” This stance is hardening. In January 2019, China adjusted the official language of the Taiwanese unification issues from the goal of “peaceful unification” to “complete unification,” thereby signaling clearly that annexing Taiwan militarily has become an option in the minds of strategists in Beijing. The “in-between” status quo, or any such solution like neutrality, is becoming less and less likely to survive the next decades. For the same reason a “Chung-hwa Federation,” too, is likely impractical because China will only allow one legal government – the PRC – to exist in cross-strait relations.

Hence, despite the laudable efforts of Lu as a peace and democracy activist, peaceful neutrality is probably a liberal illusion due to power disparities across the Taiwan Strait. Even if Annette Lu succeeds in turning the neutrality proposal into a national referendum, it will remain a self-claimed neutrality. An aggressive China has a strong intention to annex Taiwan, and the only tolerable outcome for China will always be unification, ultimately leaving little room for Taipei to negotiate.


The views expressed in this article are those of the authors alone and do not necessarily reflect those of

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