ISSUE 254                                                                                      July 25, 2024
Taiwan Weekly
Reliable report and analysis of the most important issues in Taiwan
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Trump Would Like Taiwan to Pay More for Protection
taiwanweekly2019@gmail.com
U.S. Republican presidential candidate Donald Trump stated that Taiwan has taken over America's semiconductor industry and is very wealthy. He believes that Taiwan should pay for U.S. protection.
(Photo from: United Daily News)
Featured News

To Satisfy Trump, Half of Government Budget Should Be Used on Defense

Comprehensive News Coverage by Taiwan Weekly

 

Bloomberg Businessweek published an exclusive interview with U.S. Republican presidential candidate and former President Donald Trump on July 16, in which he clearly discussed his Taiwan policy after returning to the White House if he wins the election. Mr. Trump said that Taiwan has seized the U.S. chip industry and is very rich. According to Mr. Trump, Taiwan should be paying the United States to defend it.

Featured  Commentary
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According to media commentary, if elected president, Mr. Trump may use Taiwan as leverage to negotiate with Beijing. If Taiwan's bargaining value falls short of Beijing's offers, Taiwan could be sacrificed.
(Photo from: China Times)

Trump's Strategic Ambiguity is Only Price-Calling Strategy

United Daily News Commentary, July 18, 2024

 

It appears that if Mr. Trump returns to the White House, Taiwan's situation will become even more challenging. In negotiations between Mr. Trump and Beijing, Taiwan would only be able to pay, not have a seat at the table.  Mr. Trump might use Taiwan as leverage against Beijing, demanding a price. Taiwan would then have to compete with Beijing on terms it likely cannot match, potentially leading to sacrifices. The question remains: how much leverage does Taiwan really have compared to the mainland?

read more

Fromhttps://udn.com/news/story/11091/8103077

Featured News
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The Constitutional Court has provisionally suspended six major components of legislative reform legislation. Critics argue that the grand justices have become political pawns merely following the ruling party's script.
(Photo from: China Times)

Grand Justices Cooperate with Political Performances, Become Vassals

United Daily News, July 20, 2024 

 

The Legislative Yuan recently passed amendments to the Act Governing the Legislative Yuan’s Power and Criminal Code for contempt of parliament, among other laws, drawing controversy over expansion of powers. The Democratic Progressive Party (DPP) caucus of the Legislative Yuan, Executive Yuan, the president, and Control Yuan have all filed requests for judicial review and provisional injunctions. After intensive deliberation over several days, the Constitutional Court approved temporary suspension for most of the six major parts, except for some provisions of the Act Governing the Legislative Yuan’s Power, which can still be temporarily applied. Although this decision was expected, it still stirred widespread public outcry.

read more

From: https://udn.com/news/story/7339/8107100 

This Week in Taiwan
taiwanweekly2019@gmail.com
According to a survey by the Taiwan Public Opinion Foundation (TPOF), around 50 percent of respondents lack confidence in the grand justices of the Constitutional Court; half of the population questions their independence and autonomy.
(Photo from:  China Times)

July 15: The first domestically-built submarine prototype Haikun has completed assembly of its electro-optical periscope and has been launched for dockside testing. Sea trials, including surface and submerged tests, are expected to take place in September. The Ministry of National Defense plans to allocate a budget of over NT$280 billion (about US$8.5 billion) for seven follow-up submarines over the next 15 years in the 2025 defense budget. The expedited dockside testing of Haikun will help persuade legislators from both parties.

 

July 15: The Energy Administration, Ministry of Economic Affairs, released the latest national power supply and demand report. Due to an eightfold increase in electricity demand from artificial intelligence (AI) technology over the past five years, it is estimated that power demand will grow by an average of 2.8 percent annually over the next decade. According to the report, the nighttime reserve capacity rate for this and next year is as low as 8 percent, about half of the legal standard of 15 percent. The failure of any large unit could lead to power outages.

 

July 16: According to a poll by the Taiwan Public Opinion Foundation (TPOF), only 42 percent of respondents have confidence in the independence of the grand justices of the Constitutional Court, Judicial Yuan, while 50 percent do not. Half of the population doubts the independence of the justices. The subpar public approval may weaken the credibility and authority of the Constitutional Court.

 

July 16: The Legislative Yuan voted to pass an amendment proposed by the opposition to lift restrictions on group tours to mainland China and prioritize the opening of mainland Chinese tourists to visit Kinmen, Matsu, Penghu, and other outlying islands via the Mini Three Links. The Mainland Affairs Council (MAC) responded by respecting the decision of the Legislative Yuan, emphasizing that it will continue to review current policies based on cross-strait interactions and called on the mainland to reciprocate.

 

July 17: Bloomberg Businessweek published an interview with U.S. Republican presidential candidate Donald Trump. When discussing Taiwan, Mr. Trump stated that Taiwan has taken all the chip business and should pay for American protection. He mentioned that defending a small island on the other side of the world is practically difficult, as Taiwan is 9,500 miles from the United States but only 68 miles from China.

 

Premier Cho Jung-tai stated that Taiwan is willing to take on more responsibility. Robert O'Brien, former National Security Advisor, subsequently suggested that Taiwan should increase its defense spending to at least 5 percent of its GDP. Scholars estimate that the defense budget would account for up to 43 percent of the central government's total budget.

 

July 18: Trump's "protection fee" remarks caused the stock price of the Taiwan Semiconductor Manufacturing Company (TSMC) to plummet, but TSMC President C. C. Wei stated at a press conference that its overseas expansion plans remain unchanged. Wei also introduced "Wafer Manufacturing 2.0," which extends the wafer foundry industry downstream. According to the new definition, TSMC's global market share in the wafer foundry will drop from over 60 percent to 28 percent. The market interprets this move as an attempt to reduce antitrust risks and avoid following in NVIDIA's footsteps.

 

July 19: After the opposition pushed through legislative reform bills, the Democratic Progressive Party (DPP) administration questioned its constitutionality and requested a constitutional interpretation and temporary injunction. The Constitutional Court found that parts of the bill, including entertaining of the president's state report, entertaining and interpellation of official reports, personnel consent rights, investigative rights, hearings, contempt of parliament, have constitutional controversy and approved the temporary injunction.

 

The Constitutional Court will hold oral arguments on the constitutional interpretation case on August 6 and must rule by November 6, with a possible two-month extension if necessary. Seven of the current 15 justices will complete their terms at the end of October.

 

July 19: The Chung-Hua Institution for Economic Research (CIER) announced the latest annual economic growth rate forecast of 3.81 percent, an upward revision of 0.43 percentage point from the previous forecast of 3.38 percent. The CIER analyzed that the development and applications of AI have boosted Taiwan's stock market to new highs, with the wealth effect driving private consumption growth. Meanwhile, robust related exports have further boosted economic growth, resulting in a "warm both internally and externally" growth model.

Taiwan Weekly is a newsletter released every week by Fair Winds Foundation and Association of Foreign Relations which provides coverage and perspectives on the latest developments in Taiwan.

The conclusions and recommendations of any Taiwan Weekly article are solely those of its author(s) and do not reflect the views of the institutions that publish the newsletter.


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