Ever since Taiwan’s democratic transition in the late 1980s, one of its most important political issues has been the question of how to handle relations with China. The salience of this issue in Taiwan’s politics also manifests itself in the fact that national identity has become the only dividing line between Taiwan’s two main political parties. In recent years, as economic ties between Taiwan and China have strengthened and the two economies have integrated, the impact of the China factor on Taiwanese politics has also been growing. If China’s economic development does not halt or radically change course, the impact of this factor is likely to persist into the foreseeable future. What will become of crossStrait relations if on one side, Taiwan starts to experience a growing desire for independence, while on the other, China continues to claim sovereignty over Taiwan? To be sure, the answer to this question still lies in the future. An examination of the present situation, however, may help to shed light on the impact of the China factor on Taiwanese politics after more than a decade of cross-Strait economic integration. The China factor has affected Taiwanese politics in at least two ways. First of all, there is the influence of the China factor on the national identity of the general public, which has been leaning towards Taiwanese nationalism since the democratic transition of Taiwan in the late 1980s. In this context, the question to be considered is this: have the developments that have taken place in recent years, such as Taiwan’s heavy reliance on the Chinese economy, China’s rising influence in international politics and the expansion of the Chinese military, weakened ‘Taiwanese identity’ and even increased the Taiwanese people’s ‘Chinese identity?’ I focused on this important question in a previous study, using the data from a survey conducted in 2011. This previous study revealed that the developments mentioned above did not impact on national identity trends. Taiwanese identity continued to grow stronger, while Chinese identity continued to weaken (Wu 2012). The findings from the 2013 survey, on which this chapter is based, did not differ much from those obtained two years previously: a mere 21 per cent of respondents said that they would be willing to unite with China, even if China were to become a democratic country with sound economic and social development. Within this same group, 8.2 per cent would also accept an independent Taiwan. The ‘true Chinese nationalists’ therefore

constituted only 12.9 per cent of the group. This figure was almost the same in 2011 (see Appendix 1). The second impact of the China factor on Taiwan’s politics is likely to be on the electoral competition for ruling power. Although the China factor appears to have had little influence with regard to shaping the national identity of Taiwan’s people, it might still be assumed to wield significant influence on the political competition in Taiwan, as witnessed by both the campaigns and the turnouts for national elections in recent years. Taiwan’s electorate seems to take into serious consideration the benefits of economic integration with China and hence tends to favour the political party that adopts a position inclined towards active engagement with China. The China factor was indeed the most salient, if not the only, issue during the 2012 presidential election. This issue took the form of whether Taiwan should accept the 1992 Consensus, which Beijing claimed as the bottom line for its dealings with Taiwan. The tenets of the Consensus are the principle that there is only one China and that Taiwan is part of China. Taiwan’s Kuomintang (KMT) administration has honoured the Consensus in order to achieve active engagement with China but has also added another condition, that the two sides define ‘China’ differently. The opposition Democratic Progressive Party (DPP), however, has bluntly rejected the existence of any such consensus. Since the official position of the DPP is pro-independence, it is obliged to assert Taiwan’s claim to sovereignty and the right to full self-determination. This difference in the parties’ positions on the 1992 Consensus became the most salient issue in the presidential campaign for the 2012 election. Close to the end of the campaign, some renowned business figures, presumably by arrangement with the ruling KMT, publicly questioned the DPP’s position on the 1992 Consensus. These prominent personalities included the HTC chairwoman, Cher Wang, the Evergreen chairman, Chang Yung-Fa, the Foxconn founder, Terry Gou, and the Ruentex chairman, Samuel Yin. HTC’s Cher Wang even repeated, in both Taiwanese dialect and Mandarin, that ‘it’s hard to imagine [what] bilateral relations [would be like] without the 1992 Consensus’.1 Ms Wang’s comment was broadcast repeatedly by all television news agencies in the final days of the presidential campaign. It became possibly the most famous phrase of the election. After the ruling KMT won the presidential election (51.60 per cent against 45.63 per cent for the DPP), many pundits and influential figures among the DPP attributed the party’s defeat to its rejection of the 1992 Consensus. Some prominent DPP members were quoted as saying that ‘Praying to Matsu [Goddess of the Sea] and taking care of the stomach are both necessary’. In other words, although the DPP has to honour the core value of national sovereignty in its political ideals, it also needs to face the reality of China’s impact on the Taiwanese economy. The discussions and sometimes disputes over whether the DPP should change its official position on Taiwan independence were still ongoing at the end of 2013, when this chapter was written. Some powerful figures in the party, including the Legislative Yuan caucus leader Ke Jian-Ming, even advocated ‘freezing’ or suspending the clause referring to Taiwan’s independence in the party’s platform.