The most significant event in Taiwan in 2023 was the presidential election campaign. Amid the dramatic campaign trail, the spotlight on the electoral spectacle has overshadowed other critical issues.
In March 2023, Honduras switched diplomatic relations from Taiwan to China, becoming the ninth country in the past seven years to break official ties with Taiwan. This left Taiwan with only 13 remaining diplomatic allies in 2023, but it attracted minimal attention.
After scandals eliminated other potential candidates, Vice President Lai Ching-te emerged as the sole nominee for the Democratic Progressive Party (DPP) presidential ticket. The opposition Kuomintang (KMT) faced internal divisions during the nomination process. Tech tycoon Terry Gou attempted a political comeback, but his bid for the nomination failed. Ultimately, the KMT selected New Taipei mayor Hou Yu-ih as their presidential candidate instead of Gou.
After the two major political parties confirmed their presidential candidates, the #MeToo movement took centre stage when a former DPP staffer accused a long-term DPP collaborator of sexual harassment. Her report to the DPP women’s department director was met with an unsupportive response. Despite Taiwan becoming the first Asian country to legalise same-sex marriage in 2019, the movement underscored the need for better awareness and support for gender equality and women’s rights issues.
Cross-strait exchanges between China and Taiwan have been suspended since 2016 when Tsai Ing-wen took office. Tsai’s policies to upgrade relations with the United States raised Taiwan’s international profile but caused Chinese retaliation. The opposition parties contend that the DPP’s nearly eight years in power have pushed Taiwan to the brink of war and stress the importance of re-establishing relations with China to reduce economic tensions and foster stability.
The opposition parties’ best opportunity to oust the DPP in the 2024 election was to form a coalition with the presidential candidates from the KMT, the Taiwan People’s Party (TPP) and independent Terry Gou. But this failed to come to fruition.
The fragmented opposition campaign lost the presidential campaign. All three major parties experienced gains and losses. Lai’s victory marked the first time a political party has won a third straight presidential election in Taiwan. Yet Lai won only 40.1 per cent of the vote and the DPP lost the majority in the legislature. Ko Wen-je garnered 26.5 per cent of the vote for president, while his TPP won eight legislative seats, making it critical to passing any legislation. Hou received 33.5 per cent of the vote for president, but the KMT gained 14 more legislative seats than in the previous election.
Though Taiwan’s stock market soared in 2023, few people felt the benefits of economic growth. A survey revealed that 70 per cent of Taiwanese believe that economic development should be the next president’s top priority, especially respondents aged 20–39.
Rising house prices, stagnant incomes and wealth inequality have led to widespread dissatisfaction with the DPP. This may explain why all three presidential candidates got embroiled in real estate controversies, legal or illegal, in the campaign’s final stages.
Businesses have long complained about Taiwan’s ‘five shortages’ — land, water, energy, labour and talent. Taiwan has struggled with various economic shortages, especially the egg shortage in March 2023, leading to a public outcry against the government’s egg import policy.
Taiwan faces numerous challenges and the energy shortage is especially pertinent. A survey of US businesses in Taiwan found that 70 per cent cite the lack of stable power supply as the most worrying issue. Any disruption in Taiwan’s energy supply could cripple the semiconductor industry, causing global economic and geopolitical consequences.
Taiwan imports nearly all of the fuel powering its economy and its energy demand has grown over the past 20 years. Due to its population density and limited land, Taiwan cannot significantly increase its renewable energy capacity. Despite Taiwan’s active development of renewable energy, Taiwan still relies primarily on fossil fuel-fired power generation, accounting for 81 per cent.
The DPP committed to a nuclear-free homeland by 2025, with renewable energy accounting for 20 per cent of electricity generation, which is currently 8 per cent. This goal seems unrealistic given current technology and public reluctance to accept higher electricity prices.
Taiwan must navigate its domestic issues and find the most advantageous balance between China and the United States. Taiwan’s unique position with historical and cultural links to China and shared democratic values with the United States allows opportunities for substantial influence. Realising this potential requires wisdom and foresight from Taiwan’s leaders and electorate.
Wen-Chi Yang is Director of the Center for Australian Studies at the College of International Affairs, National Chengchi University, Taiwan.
This article is part of an EAF special feature series on 2023 in review and the year ahead.