Thursday, April 16, 2009

Taichung Mayor: Supersize Me

Taichung Mayor Jason Hu, fresh from pushing for Taichung to swallow its neighboring communities and become a municipality, has called for a Taiwan and south China to form a mega-region, says SCMP (no URL, sorry):
Hong Kong, Guangdong, Fujian and Taiwan should form a "mega-region" to boost competitiveness, the mayor of the Taiwanese city of Taichung proposed yesterday.

Jason Hu Chih-chiang raised the idea at a meeting with Secretary for Constitutional and Mainland Affairs Stephen Lam Sui-lung, who gave a positive response.

Mr Hu, who arrived in the city on Monday to attend today's Hong Kong Taiwan Inter-City Forum, said he envisioned the economic hub resembling the Boston-New York-Washington megalopolis.

After a one-hour closed-door meeting with Mr Lam, Mr Hu said: "It is a breakthrough because we have not only thought about co-operation between Hong Kong and Taiwan. We're thinking about, in a much greater scale, including Canton [Guangdong] and Fujian. I think nobody had ever thought of that."

While Hong Kong had close economic ties with neighbouring Guangdong, Mr Hu noted that collaboration between Taiwan and its closest mainland province, Fujian, were similarly growing. "When we two [Hong Kong and Taiwan] co-operate more, the four can become a mega-region."

He suggested mutual preferential treatment, including landing visas for tourists and business travellers in the region. The integrated economic force would give the region "incomparable competitiveness in the world", the mayor said.

He played down suggestions that Hong Kong would lose its role after Beijing's implementation of the three direct links - air, sea transport and postal services - adding that Taiwan businesses would still need Hong Kong's financial services to help expand their markets.
Unfortunately, as was reported today, Beijing has flatly rejected a proposal to increase cross-strait flights to 300 a week, saying that Hong Kong has taken a big hit from the loss of fliers on what was once the busiest air route in the world. Hong Kong officials are also being urged to put more effort into developing relations with Taiwan, now that the CCP and the KMT are mending fences (also from SCMP):
At a meeting with visiting KMT vice-chairman Eric Chu Li-luan, who is also head of Taoyuan county, on April 1, Chief Executive Donald Tsang Yam-kuen said he hoped to visit Taiwan before his term ended in 2012. Mr Tsang spoke as Secretary for Home Affairs Tsang Tak-sing was concluding a landmark visit to Taiwan - in his capacity as leader of a joint Hong Kong and Macau delegation of Buddhist associations.

Reflecting on the dramatic changes, Ms Lu said it was merely a return to normalcy. "It's indeed abnormal for the Hong Kong government to [have been] so unconcerned about what has happened in Taiwan, as if it doesn't exist," she said.

"Taiwanese society has expressed enormous interest in gaining more of an understanding about Hong Kong. In comparison, Hong Kong has not made a lot of effort to promote itself in Taiwan."
...and further.....
Taiwan issues fall under the Constitutional and Mainland Affairs Bureau, headed by Stephen Lam Sui-lung. The bureau has been criticised for not focusing enough on Hong Kong-Taiwan relations.

Timothy Wong Ka-ying, an associate director of Chinese University's Hong Kong Institute of Asia-Pacific Studies, said the meagre budget (just a few million dollars) set aside for Hong Kong-Taiwan exchanges this year was "unbelievable". "Still, I don't think Legco will oppose an increase in funding for Taiwan issues. It's first of all a question of far-sighted vision. Then it is political will," he said.

Dr Wong said Hong Kong lost a big opportunity by not forging ties with Taiwan during the long period of uneasy relations. "Taiwan has increasingly shifted its focus onto the mainland. Now that they have direct channels of dialogue, their interest in Hong Kong has waned. It appears that Taiwanese society now sees clearly that their future lies with the mainland. That line of thinking has transcended party politics.

"If this is the case, the pace of change across the strait will be astoundingly fast. Faced with the fundamental change ... Hong Kong does not have a sense of crisis.

"We ought to act quickly on issues like the relaxation of visa restrictions on Taiwanese people visiting Hong Kong, the setting up of various representative offices and hosting events like the Hong Kong Festival in Taiwan," Dr Wong said.

Johnny Lau Yui-siu, a veteran China expert, also said Hong Kong had lagged far behind during the fast-paced changes across the strait. "I'm very disappointed. We wasted over 10 years [after the handover] in playing a role in mainland-Taiwan relations," he said.
The perceptive friend who sent me this said that another small place fearing marginalization by China is -- Hong Kong. The most recent wave of angst there was sparked by plans to transform Shanghai into a massive shipping center by 2020. Calls to move closer to Taiwan are part of that larger issue. Just as in Taiwan, calls for greater integration with China in Hong Kong are driven both by fears of economic marginalization and the Cargo Cult economic claims -- if we just integrate with China, we'll all be rich! No, $200 billion of Taiwan investment isn't enough! Must. Have. More!

My friend also flipped me a piece by SCMP's Tom Holland, which noted of Shanghai:

Shanghai is far from being a hotbed of enterprise. Ever since Jiang Zemin and Zhu Rongji took over the city's government in the late 1980s, Shanghai's economic policy has been aimed overwhelmingly at promoting state sector and foreign investment.

For years, the government funded massive investment programmes by requisitioning and auctioning land, paying minimal compensation, and ploughing the proceeds into state-owned industries. Meanwhile, every effort was made to attract investments from foreign manufacturers of high technology by offering generous tax breaks and other incentives.

In some ways, the policy was a roaring success. Between 2000 and 2004, the city's heavy industry grew at a 25 per cent annual rate, and today Shanghai is China's leading producer of cars, power generating equipment, personal computers and many important chemicals.

But the city paid a heavy price. Discriminated against by tax and other regulations, denied access to land and tied up in red tape, local private entrepreneurs got squeezed out. According to Massachusetts Institute of Technology professor Huang Yasheng, the local private sector's share of Shanghai's fixed asset investments fell from a high of 10 per cent in the mid-1980s to a negligible amount this decade (see the first chart).

As a result, private income growth was suppressed. Although today Shanghai's per capita gross domestic product is around five times the national average, disposable household income is only about 1.8 times the mean (see the second chart).

The concentration of so much wealth in the hands of the state and foreign-invested businesses has acted as a further disincentive to private enterprise. Today, according to Mr Huang, Shanghai not only has relatively fewer private companies than almost any other province in China, but they are smaller too.

The only thing we have to fear is fear itself....

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Anonymous said...

Hi Michael, I think we need to be clear about the principle here and what is to be pursued. My view is that Taiwan would do well to continue to internationalize and expand links to all of its neighbors. Given how small Taiwan is it can't be beholden to any single link to any one foreign area. Do you disagree?

In line with such a principle, I think Taiwan should certainly pursue more convenient links with China. Hong Kong would love for Taiwan to continue to rely on it, but that's just not going to happen. And we know from the charter flights expansion being denied explicitly that Hong Kong is lobbying within China against better links with Taiwan and sees Taiwan as a competitor.

In the same way, I think there is nothing bad in itself from stronger links with Xiamen, Fuzhou, Hong Kong, Guangzhou, Shenzhen, etc. It would increase Taiwan's importance as an economic and intellectual center in East Asia. But I would be also very much for strong ties with Southeast Asia, Japan, Korea, the US, etc. There's much to be improved in that dept and in fact, for whatever reason, there are many Japanese and Koreans that would absolutely love to make Taiwan home if they could find work here. Some are qualified and talented but regulations make it... difficult.

(One more sidenote--I'm against the merger of city/counties because of unfairness and decrease in number of elected officials, but that's another story).

Dixteel said...

"The only thing we have to fear is fear itself"

Not sure exactly what you are refering to, Michael, but I think that statement is quite true.

Despite all the current situation, comparing to Hong Kong and even China itself, I think Taiwan's future is still better...

Michael Turton said...

I'm all for tighter links with neighbors and have always been, but the current administration's move isn't about economic growth, but destroying the idea of an independent Taiwan.

Anonymous said...

Over reliance on one particular regional economy is not a secure or balanced existence. Taiwan would be better served by diversification. Unfortunately Taiwan's economic policy is fueled by Chinese quasi religious nationalistic pipe dreams.

Anonymous said...

Hong Kong is a very good example for Taiwan.

Hong Kong's financial clout has been greatly reduced since 1997 and it has lost most of the advantaged it once had as an Asian financial center.

The PRC has been disappointed that Hong Kongers are not as "Chinese" as they thought they should be and have increased the number of materials which promote PRC Chinese nationalism in schools. They are having a difficult time persuading Hong Kong students to view history, society and the nation the same way people do in the PRC.

People have to learn to be "Chinese".

Thomas said...


"Hong Kong is lobbying within China against better links with Taiwan and sees Taiwan as a competitor."

I would not be surprised to find out that Hong Kong is lobbying against expanding direct links too rapidly, but it is simply incorrect to say that Hong Kong sees Taiwan as a competitor. Simply put, Hong Kong just doesn't want to be cut out of the picture because they have been making money off of the lack of direct links.

As for your take on closer links, I don't think most people would disagree that closer ties are not necessarily bad. But I do think the formulation used by Jason Hu is telling of a certain mentality. He envisions one domestic Chinese regional grouping to match one domestic American regional grouping.

The really cheeky thing is that he is not talking about cooperation between cities, which is what a mayor typically has the jurisdiction to talk about. He has unveiled his grand vision for the combination of all of Taiwan, Fujian, Guangdong and Hong Kong into a mega-region. Do we now have to add the outsized ambitions of Jason Hu to those of other "envoys" such as Lien Chan, and Wu Po-hsiung?

Anonymous said...

I bet this article pisses you off. Oh well.,8599,1891883,00.html

Anonymous said...

"I'm all for tighter links with neighbors and have always been, but the current administration's move isn't about economic growth, but destroying the idea of an independent Taiwan."

Precious. Too bad you are a gaijin, otherwise, you'd make a great TI elder some day.

Anonymous said...

...Taiwan would do well to continue to internationalize and expand links to all of its neighborsBut I believe what Michael asks us to consider is under what conditions would such an mega-region be determined.

An international, not interstate, arragement would be very nice to see. But given the track records of these politicians, it's questionable whether their lofty goals reflect anything but self-aggrandizing and party politicking.

Jason Hu would handsomely and pesonally benefit from such an arrangement.

Anonymous said...

I agree that HK serves as a good lesson for Taiwan. China doesn't have to bomb HK into submission, but kill it with a slow death of economic strangulation. Wouldn't this, in turn, effectively neutralize any democratic movements inside the region? I mean, who's going to march for democracy when people are struggling to make ends meet -- and needing the economics handouts of its handlers to survive?

Anonymous said...

Natalie Tso I believe works for RTI and is a waisheng Chinese American that moved to Taiwan during her adult life.