In hammering out a deal on the resumption of direct cross-Strait links in June, negotiators agreed to increase the number of mainland tourists allowed to visit Taiwan every day from 1,000 to 3,000.
As the first wave of charter flights began on July 4, a total of 762 visitors descended upon the island and, during their eight-day sojourn, managed to spend US$1.3 million.
Taiwan’s government wasn’t complaining: it expects big things from mainland tourism. Last year, around 81,000 mainland tourists visited Taiwan. Now the target for 2008 is to bring in 1 million.
If this seems optimistic – based on how Hong Kong opened up to mainland tourists, investment bank UBS suggests Taiwan might have to wait until 2012 to pass the 1 million mark – it must be examined in the context of recent events.
From Ma Ying-jeou’s election as president in May through Nationalist Party (KMT) chairman Wu Poh-hsiung’s landmark visit to the mainland, and then the resumption of cross-Strait talks, the whole process has bobbed along on a wave of optimism.
With similar endeavor, Taiwan’s government has since announced plans to tear down numerous investment barriers, giving investors and corporations greater license to tap into rapid growth in the mainland.
The motives are clear. Taiwan is relying on closer ties with the mainland to boost an economy that most analysts expect to deteriorate over the coming months. Export-related income accounts for 19% of Taiwan’s GDP (twice as much as mainland China), which means a US recession would hit hard. At the same time, domestic consumption is lagging.
However, this recent rush to integrate shouldn’t be allowed to obscure the far more challenging cross-Strait issues that lie ahead. As the commercial stakes get higher, so do the political obstacles.
Ma has said that talk of reunification isn’t on the agenda for his presidency. But if he is unable to deliver on the economic promises that underpinned his election victory and Taiwan runs into difficulty, Ma may be unable to stop the debate becoming highly politicized.