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Recently, China announced that the chemical fiber textile and cement enterprises invested by Taiwan Far East Group in the mainland have committed a series of violations of laws and regulations, and fined nearly 500 million yuan. Beijing also stated that people who support “Taiwan independence” and disrupt cross-strait relations are not allowed to make money or “eat the pot” on the mainland.
Experts on cross-strait relations told BBC Chinese that Beijing’s approach has economic considerations as well as political goals, trying to create a chilling effect to affect Taiwan’s political donations and the DPP’s cash flow.
Punish the Far East
Chinese state media Xinhua News Agency reported on Monday (November 22) that recently, law enforcement agencies in five provinces and cities including Shanghai and Jiangsu conducted law enforcement inspections and found that the chemical fiber textile and cement companies invested by Taiwan Far East Group in the local There are a series of violations of laws and regulations in health, safety production, fire protection, taxation, and product quality.
According to the report, law enforcement agencies have imposed fines, tax recovery, and rectification within a time limit on the enterprises involved in accordance with national laws and regulations, and recovered the enterprises’ idle construction land.
On the same day, a reporter asked whether the investigation and punishment of the Taiwan Far East Group was related to the Taiwan Affairs Office’s statement of disciplinary action against “Taiwan Independence” diehards and their affiliated enterprises and financial owners in accordance with the law.
Zhu Fenglian, a spokesperson for the Taiwan Affairs Office of the State Council of China, responded that it welcomes support for Taiwan compatriots and Taiwanese enterprises to invest and develop in the mainland, and will continue to protect the legitimate rights and interests of Taiwan compatriots and Taiwanese enterprises in accordance with the law, but will never allow those who support “Taiwan independence” and undermine cross-strait relations to be on the mainland. Make money and do things like eating and drinking.
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Xu Xudong, Chairman of Far East Group.
She also stated that the majority of Taiwanese businessmen and enterprises must distinguish right from wrong, stand firm, draw a clear line with the “Taiwan independence” separatist forces, and take concrete actions to maintain the peaceful development of cross-strait relations.
Zhu Fenglian also pointed out on Wednesday (November 24) that Taiwan Far East Group had imposed a fine and collected taxes of approximately 474 million yuan, and recovered the idle construction land of one of the companies.
Before punishing the Far East Group, on November 5, the Taiwan Affairs Office of the State Council stated that it would include Su Zhenchang, You Xikun, and Wu Zhaoxie on the list of “Taiwan independence” diehards.
The Taiwan Affairs Office of the State Council stated at the time that the mainland will punish the “Taiwan independence” diehards on the list, prohibit them and their family members from entering the mainland and the Hong Kong and Macau Special Administrative Regions, restrict their affiliates from cooperating with relevant mainland organizations and individuals, and will never allow them. Its affiliated companies and financial owners are making profits in the mainland.
Political Factors
Regarding the fines of the Far East Group, Taiwan’s Mainland Affairs Council responded that the CCP created a chilling effect and interfered with the operation of Taiwanese enterprises and the operation of Taiwan’s democratic system. It will discuss and take necessary countermeasures and preventive measures in due course.
The MAC stated that Taiwanese businessmen have made important contributions to mainland China’s economic development and social employment in the past 30 years. The CCP has used political reasons to intimidate and threaten Taiwanese businessmen. The measures created a chilling effect and interfered with the operation of Taiwanese enterprises and the operation of Taiwan’s democratic system. The government severely condemned them.
Zhang Wuyue, director of the Center for Research on Cross-Strait Relations at Tamkang University in Taiwan, told BBC Chinese that the Taiwan Affairs Office of the State Council did not deny that the punishment of the Far East was due to “Taiwan independence,” which aroused attention and associations from the outside world. This is exactly what Beijing wants to achieve.
“This measure is mainly to cut off the public officials of the Democratic Progressive Party and the sources of funds publicly donated by some foundations, because elections require huge funds.” He pointed out.
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Zhang Wuyue said that Taiwan is a free and democratic society, and political donations are very clearly announced, which allows the mainland to take advantage of it.
Taiwan’s United News Network reported that in the past, the Far East Group was regarded as “blue” and most of the politicians who funded it were blue camps. However, in recent years, public information from the Supervisory Office shows that the Far East Group’s funding targets are actually blue and green.
According to reports, in the 2020 Taiwan general election, the Far East Group’s blue and green camps all support it. The largest sum was donated 10 million yuan to the Kuomintang presidential candidate Han Yu, and also to about 40 blue-green legislators candidates.
Zhang Wuyue explained that because Taiwan is a place where political parties have been changing regularly for a long time, almost all companies in Taiwan will vote in blue and green, and they have to “double bet”. If they only vote in blue or only in green, it will cause problems for business operations.
He believes that Beijing’s approach will trigger a chilling effect, “let all entrepreneurs think that more is worse than less. In the future, whether it is campaign funding for green politicians or foundation support, they will either choose not to disclose it or not. Investment, cut off the source of funds in a democratic society”.
“Beijing’s approach can make a strong account and take an oath internally, demonstrating that it is fully capable of punishing’Taiwan independence.’ They will not openly support the DPP in many ways in the future.” Zhang Wuyue said.
Regarding these punishments, Huang Zhaonian, an assistant professor at the National Development Research Institute at National Chengchi University in Taiwan, believes that Beijing wants to make political propaganda through economic decisions that it has already made to divide Taiwan’s interior.
“It is the so-called anti-independence and promotion of reunification. They want to divide Taiwan and make these Taiwanese businessmen not to support the DPP government, but to support these political parties that are more supportive of reunification.” He said.
Economic considerations
Huang Zhaonian emphasized that Beijing’s approach is essentially an economic decision. In the past, when Beijing welcomed Taiwanese businessmen to set up factories, it might give Taiwanese businessmen some “convenience” and did not implement some management measures and standard requirements, but now the mainland’s needs have changed.
He explained that in the past, Beijing very welcomed foreign investment from Taiwan and relied on foreign capital and technology to promote economic growth. However, in recent years, the mainland wanted to upgrade its industries and use independent innovation to replace things that needed to be imported in the past, and domestic demand to replace exports in the past. Need to avoid relying on the external economy.
“Now a bunch of Taiwanese businessmen and foreign investors are facing this problem. I was welcome to set up factories here because of China’s needs, but now I am not welcome anymore because China no longer needs my industry. High pollution and high energy consumption, and my identity is Taiwanese foreign investment.” Huang Zhaonian said, “Today, China encourages domestic manufacturers to develop and produce to replace the original role played by foreign capital and Taiwanese businessmen.”
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Taiwanese artist Ouyang Nana was once questioned in the mainland for supporting “Taiwan independence”.
Zhang Wuyue also said that in the past, the so-called green Taiwanese businessmen or Taiwanese artists in the mainland were mainly sanctioned by whether their words and deeds advocated “Taiwan independence” or inclined to “Taiwan independence.”
“Now the sanctions are based on corporate donations, and it has nothing to do with the words and deeds of entrepreneurs advocating independence. As long as companies with investments in the mainland make public donations to’Taiwan independence’ people, they will be sanctioned.” He said.
He believes that even if it is possible to make political donations in private, undisclosed donations are not legal and the amount cannot be large. Therefore, Beijing’s practice will somewhat limit the DPP’s cash flow.