On May 20, Lai Ching-te (賴清德), a 64-year-old member of the ruling Democratic Progressive Party (DPP, 民進黨), was sworn in as Taiwan’s new president. International officials, scholars, and attendees listened to his 30-minute inaugural address with a mix of anticipation and apprehension. Countries sharing Taiwan’s democratic values kept their fingers crossed that the new administration could navigate Taiwan through the arduous tide of authoritarian coercion waged by its giant neighbor, China. They also had high hopes that Lai would be able to bolster Taiwan in its role—as Lai described it in his inaugural speech—as a “global beacon” of democracy.
Lai pledged to “deepen international cooperation” by “using Taiwan’s democratic vitality as a force for good,” indicating his sincere intent to strengthen the self-governed island’s resilient bonds with its partners. Additionally, countries sharing values with Taiwan felt that they could count on Lai’s commitments given his reputation as a strong advocate of the island democracy’s freedom and sovereignty, along with his determination to transform Taiwan into a bulwark against authoritarianism.
Nevertheless, observers are right to be concerned about the bumpy road ahead for the vulnerable island of Taiwan. A strenuous reality confronts Lai: US ties with Taiwan are becoming more fragile in the run-up to November’s presidential election in Washington. In April, US President Joe Biden had a telephone call with Chinese strongman Xi Jinping in which both leaders underlined “the importance of maintaining peace and stability across the Taiwan Strait.” Biden seems to believe that he can prevent war over Taiwan just by maintaining warm diplomacy with Xi, who has repeatedly vowed that “reunification” with the mainland is inevitable.
On the other hand, a return of former US President Trump to the White House may break the equilibrium Former President Tsai Ing-wen’s (蔡英文) has achieved in Taipei’s relations with Washington and Beijing. A Trump presidency would expose Taiwan to vulnerabilities and unpredictable policies as he would likely take domestic issues first, rendering less clarity on US commitments towards supporting Taiwan. Trump could also use matters in chip industry as a quid pro quo for backing the Asian democracy. His grievances were plain when he decried Taiwan for allegedly stealing American semiconductors—implying a trade-off approach to foreign relations, even with the superpower’s allies and partners. “We should have taxed them. We should have tariffed them,” Trump said when asked about the geopolitical risks Taiwan endured when targeted by China’s duress.
With Chinese military power on the rise, however, Taiwan faces an ever-increasing challenge. While China’s defense budget is set to rise by 7.2 percent (making it world’s second-highest, behind the United States), the People’s Liberation Army (PLA) is becoming increasingly formidable, and its power heft poses “a potent challenge to US military dominance in East Asia.” Chinese leaders have laid out concrete policies to modernize, reform, and transform the PLA into a “more potent force” with comprehensive and competitive adaptations to modern warfare through massive research and development schemes, an increased military budget, and military apparatus restructuring.
The Lai Administration Needs a New Approach to International Relations
Lai will have a lot on his plate as he endeavors to shield the island from China’s coercion while also forging ties with like-minded partners. Yet what are Lai’s strategic assets? Lai inherits his predecessor’s legacy, including legalizing same-sex marriage, safeguarding Taiwan’s sovereignty from Chinese pressure, successfully curbing the spread of the coronavirus, kickstarting military modernization and national defense reforms, launching the New Southbound Policy (NSP) to increase Taiwan’s room for geopolitical maneuvering, and refashioning unofficial ties with the United States and like-minded partners. Former President Tsai’s proactive leadership on both domestic and international fronts have endowed Lai with essential leverage to advance Taiwan “into a new era that is full of challenges, yet also brimming with limitless hope.”
To weather the storm from Beijing, Lai should continue to strengthen Taiwan’s relations with Indo-Pacific powers, particularly Japan, Australia, and the Philippines, under the “values-based diplomacy” motto. In recent years, Australia, Japan, and the Philippines have raised concerns over Beijing’s dangerous provocations in the Taiwan Strait, while reasserting the significance of preserving peace and stability across Strait. The Sydney-based Lowy Institute’s 2023 survey indicates that Australians support responding to a Chinese attack on Taiwan with sanctions, arms and military supplies, and using the deployment of Australian Navy to prevent Beijing from imposing a blockade around Taiwan. Japan showcased its support for Taiwan by sending a 35-parliamentarian delegation to Lai’s inauguration: Chief Cabinet Secretary Yoshimasa Hayashi even called Taiwan “an extremely important partner and a dear friend” of Tokyo. In the Philippines, a US-funded port, which could serve dual commercial and military functions, is under construction. In times of crisis, Washington, Manila, and Tokyo could use the port to block China from using the Bashi Channel to enter waters east of Taiwan.
While Taiwan’s ties with Japan and the Philippines are being reinforced, its engagement with the United States has become delicate. The USD $95 billion foreign aid package to Taiwan, Ukraine, and Israel, approved by Congress in April, is helpful—yet, it is “not a silver bullet” for effectively defending the island. Taipei has every reason to question the extent to which Washington can help the nation build its military capabilities in the coming years, especially at a time when the waning hegemon is preoccupied with the protracted wars raging in Ukraine and the Middle East, neither of which are expected to end anytime soon.
With bewilderment beclouding the US-Taiwan relationship, Lai needs to be quick on his feet because—despite Washington’s current strong bipartisan backing—Taiwan still faces a more perilous world and a more powerful China than when Tsai took office in 2016. But Lai may have a moment of solace. Although China has stepped up military drills around Taiwan in the days following Lai’s inauguration to undermine his presidential position and “punish” Lai for his unwavering stance on China, the great power has refrained from triggering military clashes, as such move could entangle the United States and its allies. Given Xi’s attempts to mend fences with Washington and his preoccupation with fixing China’s flagging economy, Beijing may hold off on taking decisive action against Taiwan until at least after the US presidential election.
The time is now for Lai to set priorities for strengthening relations with Washington. The wealth of knowledge, extensive background, and broad networks with US officials and think tanks that Taiwan’s Vice President Hsiao Bi-khim (蕭美琴) possesses are invaluable to Lai in elevating Taiwan’s profile and bringing “relationships and trust” into his foreign-policy agenda. Although Lai’s inaugural address touting Taiwan’s “resilient democracy” is laudable, getting US diplomatic and financial support demands more than just political rhetoric. Taiwan needs more personal connections with politicians and legislators in Washington, but Taiwan’s foreign minister Lin Chia-lung (林佳龍) has little practical foreign policy experience. Hence, Hsiao should use her expertise and real-world experience to not only serve as the vice president, but also to bolster Lin’s role.
Likewise, Taiwan’s president should add more substance to the NSP beyond the confines of Sino-Taiwan relations. Still, Lai’s inaugural address ignored the NSP and its future trajectories. It is highly probable that Lai failed to advocate for the strengthening of ties with New Southbound countries because he was primarily focused on China’s pressure. There may be room for foreign-policy debate and reflection following the notion that Lai is not committed to bolstering the grand strategy laid out by outgoing president Tsai in 2016. This could further perplex observers, who have ample grounds to believe that Lai appears to prioritize cross-Strait relations and the coalescence of Taiwan’s relations with democracies—in Lai’s words, “a democratic community”—over Taipei’s meaningful engagement with targeted partners.
Now the Lai Administration’s priority lies in setting a new stage for an upgraded NSP, the overarching goal of which is to strengthen ties with New Southbound countries. As part of the elevated grand strategy, Taiwan should implement practical measures, such as sharing its expertise in digital technology applications, fostering symbiotic collaboration in the semiconductor sector, and sharing its trove of experiences in combatting disinformation. Those initiatives are core elements of Taiwan’s proficiency in statecraft, and the next step is to take them southwards. Moreover, Lai’s government should incorporate Palau, the Marshall Islands and Tuvalu—Taiwan’s diplomatic allies—in the revised strategy. For Taiwan, solidifying cordial ties with the threes allies is crucial, as the elevated strategy must be both effective and inclusive.
Compared to Tsai’s entry into office eight years ago, Lai is under much greater pressure to safeguard Taiwan’s sovereignty and bolster its democratic standing, which is made even more difficult due to the weight of China and geopolitical fragility across the Strait. For Lai to achieve these aims, he needs to practice statecraft, the process of setting realistic and attainable goals and marshaling available resources and assets to achieve those ends. In a nutshell, Taiwan should embrace a two-pronged strategy: one, to strengthen multifaceted ties with Washington, focusing on personal links; and second, to foster meaningful engagement with New Southbound Policy countries via sharing state-of-the-art knowledge and practical experience.
The main point: Taiwan’s President Lai Ching-te should bring more savvy to foreign policy, particularly through incorporating his “values-based diplomacy” with further outreach to both the United States and countries included within the New Southbound Policy.
