Report

An Offer They Can't Refuse

Will China win its 65-year war with Taiwan -- without firing a shot?

In the game of chess, there's a concept called "forced mate." The term refers to one side maneuvering its pieces to guarantee victory in a set number of moves, regardless of what the opponent does.

On Feb. 11, representatives of the Chinese and Taiwanese government met in the mainland Chinese city of Nanjing. Expected to produce few, if any breakthroughs, the symbolism of the event is still great: It is their first formal meeting in 65 years. Since the Nationalists fled to Taiwan at the end of the Chinese civil war in 1949, Beijing has viewed the island as a renegade province and has made its "reunification with the motherland" a paramount objective. Tensions have occasionally flared: As recently as the 1990s, China lobbed missiles into the strait between the mainland and Taiwan, Taiwanese politicians threatened to declare independence, and the United States moved two aircraft carrier groups into the region.

Today, however, the link between mainland China and the self-governing entity of 23 million people just 110 miles off its eastern coast is warmer than it's ever been, even as Taiwan continues to insist on its rights as a self-governing body. So if China makes the right moves, and continues to successfully and peacefully draw Taiwan into its orbit, can it create a "forced mate" situation?

Beijing has been making Taipei an offer it can't refuse: a readily accessible market of 1.3 billion people. In arguably its greatest foreign policy success over the last decade, Beijing has been taking a patient and long-term approach toward the island, offering sweetheart economic deals and a reduction of military rhetoric (though China still maintains an estimated 1,600 missiles aimed across the strait) while isolating Taiwan internationally. The 2008 election in Taiwan of Ma Ying-jeou, the head of the Kuomintang Party, helped: Ma's party favors closer ties with China, unlike the opposition Democratic Progressive Party (DPP), which ran Taiwan for the previous eight years.

After Ma took power, Beijing visibly softened toward Taiwan, authorizing a series of economic deals that were favorable to the island, like the Economic Cooperation Framework Agreement (ECFA), which reduced tariffs. "We can give up our profits because Taiwanese compatriots are our brothers," said then-Premier Wen Jiabao. In June 2008, the two sides agreed to begin direct tourist flights, and, in December of that year, they started direct shipping traffic and mail service. Some 2.85 million Chinese nationals visited Taiwan in 2013, up 10 percent from the year before (more than double the number coming from Japan, the second-largest source of visitors). And in 2013, bilateral trade reached $197.2 billion, up nearly 100 percent from when Ma was elected. Bloomberg, citing government statistics, reported that, today, roughly 40 percent of Taiwan's exports head to China.

Many analysts now see this as the endgame. "Cross-strait interdependence has been an irreversible process, at least in economic, social and cultural terms," notes Titus C. Chen, an associate research fellow at the National Chengchi University in Taipei. He adds, "The prospects of Taiwan can no longer be separated from those of China." When asked about the chess analogy, June Teufel Dreyer, an expert on China's international relations at the University of Miami, offered a different one instead. "There's a type of insect that a horde of ants will attack. The ants lay their eggs in the insect, and then eat it," Dreyer says. "That's what happening with Taiwan."

While Taiwan has become closer to China, it has also grown more isolated from the rest of the world. Only 21 nations recognize Taiwan, the largest of which is the poor African nation of Burkina Faso, which has a population of 15 million. The Holy See recognizes Taiwan, but it's the only European state to do so. (Taiwan is not a member of the United Nations and participates in the World Health Organization as a "separate customs territory.") Taiwan strives, and mostly fails, to attend international summits. In September 2013, I received an e-mail from the U.S. Taiwan Economic and Cultural Representative Office, Taiwan's embassy-like presence in Washington, crowing that Taiwan "has been invited to attend the 38th session of the International Civil Aviation Organization Assembly for the first time since losing its ICAO seat in 1971."

Washington, Taiwan's most important ally, has long said it recognizes that there is only one China, and that it hopes Beijing and Taipei can peacefully resolve their differences. "The administration is very supportive of improved cross-strait relations," says a senior U.S. defense official, who asked to speak on background. The United States has sold tens of billions of dollars of arms to Taiwan over the last few decades, though the number has dropped recently. "The United States makes available to Taiwan defense articles and services necessary to enable Taiwan to maintain a sufficient self-defense capability," says Jeff Pool, a Pentagon spokesman. U.S. policy toward Taiwan is often described as "strategic ambiguity" -- not stating if America will or will not defend Taiwan if China seizes it by force.

There is great strategic and symbolic value to the United States maintaining its alliance with Taiwan. But the status of Taiwan matters far less to Washington, and to Americans, than it does to Beijing and the Chinese. "There's the Inevitability Theory," says Mark Stokes, the executive director of the Project 2049 think tank, which focuses on security in Asia, and a former U.S. defense official. "Beijing says it's inevitable [that the two sides] will fulfill reunification on China's terms, and they actually believe it. The idea is: If Taiwan is going to be eaten up by China anyway, why do we want to risk the trouble?"

Inevitable or not, Beijing still faces the challenge of convincing Taiwan that unification is beneficial -- and convincing its own people that patience continues to be the best strategy. For the last 20 years, most Taiwanese have favored the tenuous status quo over declaring independence or reunifying with the mainland, according to data from the Election Study Center at the National Chengchi University in Taiwan. From 2012 to 2013, the number of Taiwanese wanting to maintain the status quo but eventually move toward independence rose from 15.1 percent to 17.9 percent, while 2.1 percent wanted immediate unification. This may be a gain for the pro-independence side, but roughly 58 percent of Taiwanese still don't want things to change.

These numbers are far less favorable to China than the most relevant comparison: Britain's return of Hong Kong to the mainland in 1997. In February 1993, 42 percent of Hong Kongers wanted to join China, while 25 percent wanted independence, according to the Hong Kong Transition Project, a research organization. In the weeks before the handover, as people adjusted to the new reality, those numbers changed to 53 and 17 percent, respectively. But Beijing and London agreed to return Hong Kong in 1984; the mainland had 13 years of preparation to make it palatable.

As China and Taiwan continue to move closer together, Beijing may feel like it lacks the luxury of time it had with Hong Kong. "The political pressures on the Chinese government when it comes to Taiwan are tremendous and growing. In the past, Chinese people knew that China was weak and could not stop the United States from selling weapons to Taiwan. Now many believe that China should no longer tolerate such insulting behavior," wrote Jia Qingguo, associate dean at the school of international studies at Peking University, in the 2014 book Debating China. "Because national unification is an important source of political legitimacy, the [Communist Party] could face a serious domestic political crisis if it does not handle the Taiwan issue deftly."

Xi Jinping, China's most powerful and assertive leader in decades, may be keen on resolving the issue once and for all. In October 2013, Xi said the problems caused by the cross-strait issue should not be handed on from generation to generation. "The question is, was Xi shifting away from [his predecessor] Hu Jintao's policy of patience?" asks Alan D. Romberg, director of the East Asia program at the Stimson Center and a former State Department official.

Internationally, too, the timing is propitious. As tensions increase between China and its neighbors over territorial disputes in the East and South China Seas, "this has diverted the attention away from Taiwan -- very few people talk about it anymore," says Stokes. (Both China and Taiwan agree that the Diaoyu, the disputed islands that Japan administers and calls the Senkaku, belong to Taiwan. The only marked difference between China's and Taiwan's claim is who owns Taiwan.) There's increased pressure to make progress before Ma -- who will likely be succeeded by a less China-friendly politician -- leaves office in 2016.

So what will China do? Beijing's representative at the Feb. 11 meeting, Zhang Zhijun, said both sides should have "a little more imagination" without elaborating. The only concrete takeaway so far is that both sides have agreed to set up representative offices "as soon as possible," though it is unclear when.

One thing "imagination" probably does not mean is war: It is extremely unlikely that China will invade Taiwan in the near term. The mountainous island would have a lot of advantages in that fight. The Taiwanese could focus on asymmetrical capabilities, good beach defenses, and smaller units that are difficult to target. Even if the United States decided not to intervene, a Chinese victory would not be assured.

In October 2013, Taiwan released a national defense report stating that Beijing would be able to mount a comprehensive cross-strait offensive by 2020. If China were to succeed in a military campaign against Taiwan, it would create a tremendous amount of resentment, not only in Taiwan, but around the region -- belying Beijing's assertion that China's rise will be peaceful. Ultimately, China will win if it can convince Taiwan to give in without a fight: through economic cooperation, technology sharing, and, if Beijing can improve its image, a chance for Taiwan to be a part of greater China. "The whole point of China's policy is to try to create an environment where people in Taiwan want to unify," said Romberg.

For Taiwan, the greatest danger is not military attack, but that Beijing "might exploit its growing power to 'intimidate Taiwan into submission' on China's terms," Richard Bush, a former head of the American Institute of Taiwan, the private corporation that manages U.S. interests on the island, said in January, according to the newspaper Taipei Times. Chen of National Chengchi University believes "the only option -- indeed a risky one -- is to engage China, further integrate into her economic and social systems, and change her political and ideological architecture from within." A liberalized or democratic China would treat Taiwan differently -- but drastic political change in Beijing is unlikely. "Barring an unexpected event, the prospects for continued independence in Taiwan do not look good," Dreyer says.

As China continues to expand in influence, the world increasingly sees the Middle Kingdom, rather than the United States, as the future. When large numbers of Taiwanese begin to do the same, that's checkmate.

Mark Ralston/AFP/Getty Images

Report

The Geopolitics of Gas Exports

Why lawmakers from both parties, and plenty of countries overseas, are desperate to speed up U.S. energy exports

The Energy Department approved the construction of a new multi-billion terminal for exporting U.S. natural gas overseas, only the sixth green light the Obama administration has given during 18 months of bitter political jousting over how to best take advantage of the United States' sudden energy abundance.

Proponents of greater energy exports in Congress, as well as the growing number of countries that want to buy U.S. natural gas, are pushing the White House to sign off on projects more quickly. The Obama administration is still mulling whether to clear the way for the construction of another 25 export facilities. If approved, the new facilities could have the capacity to liquefy and export nearly 35 billion cubic feet a day of natural gas.

There's a catch, though. U.S. law makes it extremely difficult for American companies to export natural gas to countries that don't have free trade agreements with Washington. Companies that want to sell to those countries need to persuade the Energy Department that the deals would be in the U.S. national interest, a criteria without a formal definition. That makes the approval process a lengthy and byzantine process that is deeply frustrating for would-be purchasers of U.S. gas. At the same time, big gas producers such as Qatar and Australia are ramping up their own gas-export capabilities, threatening to close the window of opportunity for U.S. exporters.

"I always am glad to see the Department of Energy approve another permit to export [liquefied natural gas) abroad] but there is a bipartisan chorus here in the Senate that believes DOE must move faster," Sen. James Inhofe (R.-Okla.) told Foreign Policy. "Our friends and allies abroad are struggling to meet their energy needs, and they face enormous pressure to purchase from Russia and Iran. It is vital we offer our allies other options for energy."

Lawmakers in both the House and the Senate, including Sen. Inhofe, have introduced legislation that would fast-track approval of U.S. gas exports for friends and allies, such as North Atlantic Treaty Organization countries in Europe and Japan in Asia.

Increasingly, export proponents are pointing to the potential geopolitical benefits of exporting U.S. energy to make their case and win political support on the Hill. A recent report prepared by the House Energy and Commerce Committee found, for example, that American gas could bolster friendly nations while helping to undermine energy powerhouses like Russia that frequently act against U.S. interests.

"An increased American contribution to global energy markets can enhance national security by supplanting the influence of the troublesome participants currently dominating those markets, especially Iran and Russia," the report argued.

Rep. Michael Turner (R.-OH), the author of House legislation that would fast-track export approvals to friendly governments, told FP boosting allies economically and in terms of their own energy security was a "win-win" for the United States.

In addition to the latest government approval, export proponents have another cause for cheer: Sen. Mary Landrieu (D.-La.) will take over the Senate energy panel this week, part of a congressional game of musical chairs set in motion by former Montana Democrat Max Baucus' recent confirmation as the next U.S. ambassador to China. Landrieu is an unabashed proponent of greater U.S. energy exports, in contrast to the outgoing chairman of the energy panel, Sen. Ron Wyden (D.-OR.). Still, it's unclear whether the change in Senate energy leadership will shake up the administration's cautious approach to approving export plans.

Many U.S. allies are beginning to run out of patience. Europeans and Asians alike are clamoring for greater access to U.S. gas, which even with the cost of liquefaction and transport would still be cheaper than what's currently sold in their countries. Unlike the market for crude oil, there is no global market for natural gas, which leads to stark price differences from one region to another. Asian natural gas prices have recently been about four times the U.S. price, while European prices average about three times as much.

Proponents of greater U.S. exports also point to the way Russia has been able to exert increased control over the Ukraine, a nominal U.S. ally whose natural gas supply is firmly dependent on the Kremlin's good graces. To many Europeans, the Ukraine has been a cautionary tale about the dangers of relying too much on Russian gas to meet their energy needs, making an American alternative increasingly attractive. Parades of European and Asian diplomats have landed on the Hill to argue for an overhaul in U.S. export policy.

"It's an interesting situation, we are in the same defense alignment (NATO), but we are unable to trade the energy resources which are so important for us, not only for the economy but in terms of national security as well," said Simonas Satunas, the deputy chief of mission at the Lithuanian Embassy in Washington.

Lithuania is 100 percent dependent on a single Russian pipeline for its natural-gas imports, and is building a new LNG terminal to be able to diversify its energy sources and start importing LNG by early 2015. Lithuania would like to count the United States as one of its potential suppliers.

Japan, another close U.S. ally, has also increased its reliance on expensive, imported natural gas since the March 2011 nuclear accident at Fukushima, which led to the shuttering of all of Japan's nuclear reactors. Japan's trade deficit is soaring, and government officials are concerned about how energy costs are undermining economic competitiveness.

Luckily for Japan, exports from four of the six LNG terminals approved so far, including the Louisiana project greenlighted Tuesday, are at least partly earmarked for the Japanese market. That means that the United States is on track to become one of the biggest suppliers of natural gas to Japan starting after 2017, Japanese officials told FP.

But other big Asian gas consumers, especially India, are still urging the U.S. to make natural gas more readily available. India, like China, is trying to find a way to meet rising demand for energy without relying entirely on coal, which has terrible environmental consequences.

The increasing focus on the geopolitical benefits of U.S. energy exports shifts the terms of the debate, which initially centered on domestic economic impacts. Opponents of unfettered gas exports, including big industrial consumers of gas like Dow Chemical, argue that exports could push up domestic prices, thus knocking out one of the pillars of the recent U.S. manufacturing renaissance. But studies that the Energy Department. commissioned concluded that natural-gas exports would have little impact on domestic gas supplies or prices.

Export proponents see the emphasis on the geopolitical benefits as a way to garner more support among lawmakers who might otherwise be leery of the domestic impacts of shipping cheap U.S. energy overseas.

"I think the bill is building momentum," Turner said. "In one form or another, it's an inevitability."

Derek Keats - Wikimedia Commons