Taiwan

Taiwan opposition leader calls for ‘reconciliation’ after meeting Xi | Xi Jinping News

Taipei, Taiwan – Opposition leader Cheng Li-wun and Chinese President Xi Jinping have met in Beijing, where both leaders stated their opposition to Taiwan independence and expressed a desire for a “peaceful” resolution to the long-running dispute over the island’s future.

They posed for photos at the Great Hall of the People and exchanged public remarks, in addition to holding their closed-door meeting.

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Cheng is the highest-ranking Taiwanese leader to meet Xi since President Ma Ying-jeou talked with the Chinese leader in Singapore in 2015. They met again in China two years ago when Ma was a private citizen.

Both Cheng and Ma are members of the Kuomintang, the conservative-leaning Taiwanese political party that advocates for greater engagement with China by Taiwan’s self-ruled democratic government.

During her public remarks, Cheng stressed that Chinese and Taiwanese leaders should work to “transcend political confrontation and mutual hostility”.

“Through the unremitting efforts of our two parties, we hope the Taiwan Strait will no longer become a potential flashpoint of conflict, nor a chessboard for external powers,” Cheng said, according to an English translation.

“Instead, it should become a strait that connects family ties, civilisation and hope – a symbol of peace jointly safeguarded by Chinese people on both sides,” she said.

Cheng’s remarks were sprinkled with well-known Chinese Communist Party talking points, praising its success in eradicating absolute poverty to its goal of achieving the “great rejuvenation of the Chinese nation.”

“During their open-door meeting, Xi also emphasised Taiwan and China’s shared history and culture, stating that “people of all ethnic groups, including Taiwanese compatriots,” had “jointly written the glorious history of China.”

“All sons and daughters of China share the same Chinese roots and the same Chinese spirit. This originates from blood ties and is deeply embedded in our history – it cannot be forgotten and cannot be erased,” Xi said.

He added that together with the KMT and other members of Taiwanese society, Beijing was ready to “work for peace” across the Taiwan Strait.

Both leaders said they oppose “foreign meddling” in Taiwan-China relations – a reference to US interference – while Cheng suggested that she would slow Taiwan’s military build up, according to Wen-ti Sung, a nonresident fellow with the Atlantic Council’s Global China Hub.

“She talked about the ‘institutional arrangement for war prevention,’ which was a euphemism for saying that under her leadership, the KMT would not be seeking a defence and deterrence-oriented approach to war prevention,” he told Al Jazeera.

The message, in short, was that “Taiwan ought to slow down on defence buildup and buying US arms,” Sung said.

Taiwan’s military expansion has been a hotly debated issue in the legislature, where the KMT has for months blocked a $40bn special budget to acquire US weapons. The opposition party alleges that the defence bill is too large and too vague. It offered a smaller $12bn alternative instead.

Writing on Facebook ahead of the meeting, Taiwanese President Lai Ching-te of the Democratic Progressive Party (DPP) wrote that the KMT continues to “deliberately avoid cross-party negotiations” while delaying approval of the special defence budget.

Lai said that his government also supports peace, but not “unrealistic fantasies”. Despite promises of peace from Xi, China has steadily ramped up its military presence in the waters and airspace around Taiwan in recent years. Since 2022, China’s armed forces have had six rounds of multi-day live-fire military drills in the Taiwan Strait, the 180-kilometre wide waterway dividing Taiwan from mainland Asia.

“History tells us that compromising with authoritarian regimes only sacrifices sovereignty and democracy; it will not bring freedom, nor will it bring peace,” Lai wrote on Facebook.

China accuses the ruling DPP’s leadership of pushing a “separatist” agenda. The DPP advocates for a distinct Taiwanese identity and, over the past decade, has tried to raise Taiwan’s profile on the world stage — which has provoked anger in Beijing.

The Chinese leadership cut off formal contact with Taipei shortly after the DPP came to power in 2016, although it continues to communicate through different groups, including the KMT.

That is partly why Cheng’s trip to China has been viewed with scepticism in some corners of Taiwan, particularly among the ruling DPP.

Speaking to reporters after the meeting, Cheng sidestepped questions of whether she supported Taiwanese and Chinese unification, but said her main goal was to seek “reconciliation” based on shared history and culture.

However, the KMT and the Chinese Communist Party have not always got along.

They fought a bloody civil war from the 1920s to the 1940s during China’s republican era, only pausing to fight the Japanese during the Second World War.

The KMT-led Republic of China government later retreated to Taiwan, a former Japanese colony, in the late 1940s, vowing to one day return to China. The conflict was never fully resolved. The CCP continues to claim Taiwan as a province, and remains committed to annexing it one day, peacefully or by force.

Taiwan’s Mainland Affairs Council – which sets Taiwan’s policy towards China – said this week that Cheng’s talking point that Taiwan and China are “one family” mischaracterises Taiwan’s sovereignty dispute as an internal disagreement rather than one between two governments.

While still formally known as the Republic of China, Taiwan has undergone a cultural and political sea change since democratisation in the 1990s, accompanied by a rise in Taiwanese nationalism.

In 2025, a national identity survey by the National Chengchi University in Taiwan found that 62 per cent of respondents identified as “Taiwanese”, up from 17.6 per cent in 1992, the first year of the survey.

The percentage of respondents who identify as “Taiwanese and Chinese” has fallen from 46.4 per cent to 31.7 per cent over the same period, while respondents identifying as “Chinese” fell from 25.5 to 2.5 per cent.

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Taiwan: Powering Ahead

VITAL STATISTICS
Location: North Asia
Neighbors: China, the Philippines
Capital City: Taipei
Population (2025): 23.2 million
Official Language: Mandarin Chinese
GDP per capita (2025): $39,000
GDP growth rate (2025): 7.71%
Inflation (2025): 1.66%
Currency: New Taiwan dollar
Investment Promotion Agencies: Ministry of Economic Affairs (MOEA), Department of Investment Promotion (DOIP), Bureau of Industrial Parks (BIP)
Investment incentives: Streamlined approvals; dedicated project managers for projects over NT$500 million ($15 million); R&D tax credits; investment tax credits up to 25% on investment in key supply chains or advanced processes; location-based incentives in science parks, industrial
parks, and free-trade zones; relaxed visas for talent attraction, including the Employment Gold Card program
for skilled talent
Corruption Perceptions Index rank (2024): 25/180, where 180 is most corrupt
Political risks: The administration of President Lai Ching-te faces an opposition-controlled legislature that often blocks budget proposals, risking policy paralysis or destabilization in the face of Chinese interference
Security risks: Potential for naval blockade, military attack, or full-scale invasion by China

No other developed market has demonstrated the impact of AI and high-performance computing booms more dramatically than Taiwan. And the data suggests that these booms are not about to turn to bust anytime soon, despite fears of overheating and a decline in external demand for Taiwan’s exports.

A forced unification with China might render it a no-go area for numerous investors. But ignoring that wildcard scenario, there is no escaping the fact that Taiwan is now a lynchpin of the global supply chain and, by extension, the global economy, as well as a significant destination for investment and trade: the latter being a position on which the island’s economy and its 23.2 million population depend.

Taiwan sits at the center of the global hi-tech supply chain thanks to its pre-eminence in semiconductor manufacturing, AI, and 5G telecommunications. Thanks to investment incentives and an environment fully open to growth and cooperative opportunities, the island is a magnet for foreign direct investment (FDI), led by the Netherlands and followed by the US, which held $19.3 billion in FDI as of 2023.

FDI is critical, given Taiwan’s self-imposed debt ceiling and the cap it imposes on public spending. The Department of Investment Promotion provides streamlined services to foreign investors in a bid to boost FDI, making dedicated project managers available for investments above $15 million and R&D subsidies.

Still, some international investors worry about the dominance of Taiwan’s state-owned enterprises, claiming they distort fair-market practice and lack regulatory transparency.

That said, Taiwan stunned with full-year 2025 GDP growth of 7.71%, an upward revision from the initial 7.63% estimate in January by the Department of Statistics and a figure that wrongfooted all but a handful of economic forecasters.

That result marked Taiwan’s fastest pace of economic expansion in 15 years and smashed forecasts from the likes of the International Monetary Fund and the Asian Development Bank, which ranged from 2.9% to 5.1% for 2025 when the year kicked off.

Last year’s economic performance was superlative across the board, boosted by a tidal wave of global demand for the AI-related exports that power Taiwan’s economy, notably semiconductor manufacturing capacity that has propelled the island from developing to developed status in less than a generation.

Exports surged by 35%, quarterly growth in the last three months of the year was an eye-popping 12.68% year-on-year—the highest in 38 years—and stocks advanced strongly, pushing the TAIEX into the global top 10 by market capitalization early this year as the index hit a 100 billion New Taiwanese dollars ($32 billion) valuation for the first time.

Excessive Concentration?

PROS
Preeminence in global semiconductor supply chain
Foreign investor-friendly policies, including numerous incentives
Low domestic interest rate and inflation
Strong correlation of growth and investment with the global AI boom
Political stability
Strong official institutions

“We have upgraded our GDP growth forecast for this year to 6%, which is a totally crazy rate for a developed economy,” says Alicia Garcia-Herrera, chief economist for Asia Pacific at French finance giant Natixis in Hong Kong and a senior fellow at the Brussels-based economic think tank the Bruegel Group.

“Bear in mind Japan grew last year by just 1.1%,” she added. “A milestone indicator of the country’s economic success has been its overtaking both Japan and South Korea in terms of GDP per capita, which hit $39,477 last year.”

The fly in the ointment, Garcia-Herrera notes, is that growth is concentrated in the semiconductor sector “and its ancillary industries such as packaging, which are all dependent on demand from that one single sector.”

Taiwan’s focus on exports, particularly semiconductors, has provoked grumbles that the basic stance of the Central Bank of the Republic of China is to keep the Taiwan dollar artificially low, crowding out other domestic industries and exposing the economy to concentration risk via dependence on tech-related exports.

CONS
Geopolitical tensions with China
Overexposure to the global AI boom
Risk from excessive capex spending related to AI

The currency dramatically strengthened against the dollar in May, down to 28.85% as the result of inbound investment flows and generalized the dollar’s weakness versus other Asian currencies.

The new Taiwan dollar subsequently weakened as the result of reported central bank intervention, to stand in late January at 31.7 to the dollar and renewing the view that the currency is artificially undervalued. Rates are ultra-low across the yield curve for government bonds, which range from 1.21% for two-year to 1.43% for 10-year issues, anchored by a 2% policy rate.

In this context, a remarkable feature of last year’s growth was the absence of overheating in the economy, with the CPI at just 1.66%, allowing the central bank to hold the policy rate steady: a stance it is expected to maintain this year. 

“The strong concentration on exports leaves the economy vulnerable to a slowdown in its key trading partners and reduced global AI demand,” cautions Sagarika Chandra, director of APAC sovereigns at Fitch Ratings in Hong Kong. “Taiwan’s electrical equipment exports as a share of total exports are relatively large, at around 43%, and weaker demand for such exports is likely to have a substantial negative impact on growth through lower exports.”

FDI Surges

Inbound and outbound FDI has played a significant role in Taiwan’s economic trajectory. The former surged 44% last year, to $11.39 billion, driven by technology and services, including semiconductor manufacturing, AI, renewable energy, and financial services. Investment incentives available for inbound FDI include special tax treatment and set-up support from Invest Taiwan, a government agency.

Mainland China has dominated inbound FDI recent years, but as Taipei seeks to strengthen economic ties beyond its neighbor into Southeast Asia and the US, inbound FDI from the mainland shrank by 65.4% last year.

As Taiwan shudders at the prospect of the Trump administration slapping tariffs on its semiconductors the island has committed to its biggest-ever outbound FDI undertaking, the construction of a $250 billion semiconductor manufacturing plant in the US by Taiwan Semiconductor Manufacturing Corporation (TSMC). In return, Taiwan is to receive a tariff exemption on microchips and a reduction in overall tariffs on other products.

Observers doubt the manufacturing shift will prove a significant liability.

“The offshoring of semiconductors, in my opinion, is not a big problem for the country,” says Garcia-Herrera, “because if Taiwan continues to serve all that global demand from Taiwan, all the resources will only go to the semiconductor industry, whether it’s green energy, water, the best talent, you name it. So offshoring is a good idea, because it frees up domestic resources.”

In 2026, Fitch expects the economy will continue to benefit from the increased production and investment by some advanced AI chip producers, even if there is some moderation in demand, according to China. We expect the US–Taiwan trade agreement, which reduced tariffs to 15% from 20% previously, could offer near-term relief for Taiwan’s semiconductor export-driven economy, creating a more level playing field for key export sectors.”

More concerning, Taiwan is extremely dependent on energy imports: almost 98%, according to data from the US Energy Information Administration. That’s an alarming figure given the needs of the island’s energy-intensive tech sector and its vulnerability to a potential naval blockade. Renewable energy is therefore expected to be a more significant variable in Taiwan’s economic trajectory.

It has a long way to go. Just 12% of the 288 terawatt hours the island generated in 2024 came from renewables, with the bulk coming from natural gas (42%) and the rest from coal (39%) and nuclear power (4%). But this could present an opportunity for further FDI.

“Renewable energy will be vital for Taiwan’s economic development regarding the decarbonization trend and compliance requirements from the international value chain, especially the semiconductor industry,” points out Ching-Wen Huang, director for renewables and sustainability advisory at sustainability consultancy NIRAS. “Taiwan has a relatively open renewable energy market for foreign companies,” he says, “and the government is truly welcoming foreign investment and corporations in the development and supply chain.

The post Taiwan: Powering Ahead appeared first on Global Finance Magazine.

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S. Korea to remove ‘China (Taiwan)’ label from e-arrival system after Taiwan’s protest

South Korea will remove the “China (Taiwan)” label from its e-arrival system, a foreign ministry official said Tuesday, after Taiwan changed South Korea’s name in its immigration system from “Korea” to “Korea (South)” in protest.

Seoul plans to remove the “last point of departure” and “next destination” fields from e-arrival cards, where the island nation had been listed as “China (Taiwan),” the official told reporters. It will remain listed as Taiwan in the country and region field.

“We have reviewed the matter and are moving forward with plans to remove the ‘last point of departure’ and ‘next destination’ fields from the electronic arrival card,” he said.

The official said the paper arrival cards already do not include those fields, and that the move is part of efforts to streamline the system, improve convenience for visitors from Taiwan, and align the paper and electronic arrival formats.

The Ministry of Justice is handling the matter in line with relevant procedures, the official said.

Seoul’s decision came after Taiwan called for a “correction” in its labeling as “China (Taiwan)” on e-arrivals, saying it has changed South Korea’s name in its immigration system from “Korea” to “Korea (South)” in a reciprocal measure.

Taipei had warned that it would take further corresponding steps if it sees no positive action from Seoul by the end of this month.

Taiwan’s foreign ministry said Tuesday that it has learned Seoul was under an “internal administrative and technical review” to update its e-arrival card system. It said Taiwan will temporarily suspend its own change to the e-entry registration.

Seoul noted that the decision was not made in response to Taiwan’s stated March 31 deadline for possible additional measures over the labeling, but was intended to address the issue in a way that promotes practical, unofficial cooperation with Taiwan.

Taiwan is also reportedly expected to take reciprocal steps to restore “Korea” in its foreign residents’ certificates.

Seoul’s decision to remove the two fields will be applied to all countries.

South Korea severed official diplomatic ties with Taiwan in 1992, when it established formal relations with mainland China. Since then, the two sides have maintained practical ties in an unofficial manner.

China considers Taiwan, self-governed since it broke away from the mainland in 1949, as part of its territory that must be reunified by force if necessary, and it has strongly objected to any country that challenges this stance.

“We maintain necessary communication with China on matters of mutual interest,” the Seoul official added.

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China restarts military flights near Taiwan

Taiwan on Sunday reported a sudden surge in Chinese military aircraft flying near the island and crossing its air defense alert zones after a two week period of relatively few of the flights. The Taiwanese Defense Ministry noted, however, the China’s Navy — its Shandong aircraft carrier can be seen during a Chinese military exercise in 2025 — continued to circle the island daily. File Photo by Taiwan Military News Agency/EPA-EFE

March 15 (UPI) — Taiwan’s defense ministry on Sunday said that more than two dozen Chinese military aircraft and several naval vessels were detected near the island, which comes after a period with relatively few such incursions.

After decreased presence of Chinese incursions into the island’s air defense identification zone (ADIZ) during the last two weeks, China sent 26 aircraft that were spotted around the island – 16 of which violated the ADIZ – and seven naval vessels sailed toward it, The Independent and The Wall Street Journal reported.

China considers Taiwan to be its territory. On a regular basis, it sends military aircraft and naval vessels toward the island, but during 10 of the last 16 days — from Feb. 27 to March 5 and March 7 to 10 — no flights near the island were reported.

On the other days, there were as few as two flights detected.

Taiwan regards the incursions into its airspace and waters as routine harassment, for the most part, but China also has held military exercises close to what Taiwan considers its territory and has threatened to take the island by force if it deems it necessary.

Wellington Koo, Taiwan’s defense minister has said that although there has been a noticeable decrease in aircraft nearing or crossing the ADIZ, the island nation’s military planned to stay on guard.

“We cannot rely on a single indicator like the absence of aircraft,” Koo told The Journal, because naval vessels still circle the island daily.

Analysts have suggested that the decrease in incursions is timed to a meeting of the Chinese legislature, which has happened previously, or be part of a diplomatic or strategic play before U.S. President Donald Trump and Chinese President Xi Jinping meet in Beijing at the end of the month.

An Iranian man raises a portrait of new supreme leader Mojtaba Khamenei during a rally on Revolution Street in Tehran on March 9, 2026. Photo by Hossein Esmaeili/UPI | License Photo

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