Taiwan 2014

Elections in Taiwan generally live up to democratic standards, even though vote-buying was somewhat of an issue during the last elections. The last presidential and parliamentary elections in 2012 were deemed free and the results were undisputed. President Ma Ying-jeou of the Kuomintang Party (KMT) secured a second term in office after a close race against opposition candidate Tsai Ing-wen of the Democratic Progressive Party (DPP). Mainland China’s explicit preference for Mr Ma may have influenced voter behaviour. Voters opted for stable relations with the People’s Republic rather than the tougher stance towards the bigger neighbour that Tsai Ing-wen may have brought about. Opposition parties can form and operate freely in Taiwan. The same is true for civil society

There are no veto players without a constitutional mandate within the political system of Taiwan. However, due to its historical relations with the mainland, China plays a crucial role in Taiwanese politics. Beijing still considers Taiwan a breakaway province and threatens war if formal independence is declared. This leads to politicians regularly refraining from introducing policies which may upset Beijing. Additionally, China tries to develop more and more strongholds in Taiwan’s economy, especially the media sector. Therefore the People’s Republic has to be considered an important external veto player in Taiwan’s political landscape. 

Until Taiwan’s democratisation in 1987, the Taiwanese media landscape was heavily censored. Nowadays, freedom of speech and expression is guaranteed. Accordingly, press and media are free in Taiwan and reflect diverse and critical views and opinions. A multitude of newspaper, radio and TV stations exists. The internet is also freely accessible and non-censored which is why Taiwan is among the top scorers of press freedom within Asia.

However, media outlets usually have strong affiliations with political parties, hence offering preferential coverage to their respective candidates. Also, China seeks to use its economic power to exert political influence through Taiwanese media.

The Taiwanese court system is independent of political interference, and trials are generally fair. However, in recent years there have been concerns over the selection of judges for high-profile cases as well as corruption scandals that call judicial independence into question. In June 2011, in an effort to reform the legal system, the legislature passed a law that would allow for the removal of corrupt and incompetent judges. The law took effect in July 2012. 

Although significant progress has been made towards dealing with corruption in Taiwan, it remains a problem. Chen Shui-bian, a former president, currently serves a 19-year jail sentence for corruption. (His supporters insist that his conviction was politically motivated.) Transparency International ranks Taiwan 36th out of 177 countries. Although the Taiwanese government has objected to Transparency’s assessment of the extent of corruption (in a survey of Transparency 36% of respondents said that they were required to pay bribes when dealing with public officials), evidence suggests that it takes the problem seriously. The Agency Against Corruption, established in 2011 and acting under the Department of Justice, has helped in combating corruption among low and mid-level public

Human Rights are generally respected and protected in Taiwan. In general, minority rights and the rights of indigenous people are respected. Prison and detention centre conditions meet international standards and there were no disappearances reported in the last year. Police refrain from arbitrary arrests and lawyers are permitted to observe interrogations to ensure no ill-treatment occurs. In 2013 Taiwan’s defence minister unveiled a series of new measures to reform military punishment procedures after a 24-year-old had died of a heatstroke after being placed in confinement and forced to do a harsh regime of exercises. Unfortunately, the death penalty remains in place. The government has reneged on recent rhetoric of abolishing the death penalty and has instead set up a special

Property rights are adequately protected under Taiwanese law. The courts honour and enforce contracts, but the judicial process can be slow at times. Several laws have been passed to enforce the protection of intellectual property rights and an intellectual property court was established in 2008. Yet pirated CDs and DVDs, counterfeit pharmaceuticals and fake luxury goods still are readily available.

Government spending has risen to 23% of GDP. Recent privatisation and deregulation measures led to the state playing a smaller role in Taiwan’s economy.

Taiwan has a comparatively high income tax rate of 40% and a corporate tax rate of 17%. Other taxes comprise value added tax and property tax. Overall tax revenue represents about 8.8% of GDP.

Taiwan’s financial sector is modern and competitive but subject to government interference. The government, through its own institutions which account for roughly half of the country’s financial assets, dominates banking. Foreign investors operate freely but foreign banks play only a limited role. Taiwanese regulations well protect the freedom to start, run and close a business. A one-stop shop for business registration has greatly facilitated the starting of a business and application for a license. The necessary steps to start a business can be done in just ten days and three procedures. There are no minimum capital requirements. A license can be obtained in 94 days and 10 procedures. Closing a business is an uncomplicated process. The World Bank ranked Taiwan at the 16th

Taiwan’s weighted average tariff rate is 2.1%. With trade with China being the only exception, the state does not interfere significantly with foreign trade. In the case of China, regulations to control Taiwan’s trade and investment dependency on the mainland are in place. Amongst the obstacles to foreign trade are import and export bans and restrictions, state trade in some goods and weak enforcement of intellectual property rights.