If trade can shape politics easily, it should not take long for China to reunite with Taiwan. Beginning in the mid-2000s, China started to ease up on its military pressures and began to offer economic incentives to TaiwanFootnote 1 in an effort to overcome resistance to unification.Footnote 2 However, as recent studies show, even after years of economic engagement, the political attitudes of the Taiwanese remain largely unchanged.Footnote 3 In other words, if the cross-Strait relationship is a battleground for interests and identity, the interest factor has failed.Footnote 4
These findings contradict the accepted wisdom.Footnote 5 They are criticized because “even though economic engagement does work, the general trends of Taiwan's public opinion won't change that fast. It needs time to take effect.”Footnote 6 Accordingly, Beijing keeps on subsidizing cross-Strait exchanges, the Kuomintang (KMT) continues to liberalize trade links, and the Democratic Progressive Party (DPP) still boycotts all of these policies.Footnote 7
To gain a better understanding of the political implications of China's economic engagement, the authors propose to focus on “sensitive groups” within cross-Strait relations. “Sensitive groups” references those who are heavily exposed to the influences of economic engagement and who should therefore manifest attitudinal changes the earliest.Footnote 8 Following this rationale, the article focuses on fish farmers in Syuejia (Xuejia) 學甲, a small town in southern Taiwan. Traditionally, almost all the farmers are pro-DPP, but recently some of them have benefited from the Chinese-designed “contract farming” (qizuo 契作) programme. By surveying the changes, if any, in the political attitudes of these farmers, it is possible to observe the interplay of identity and interests and assess the efficacy of China's economic statecraft.Footnote 9
With the same idea, Business Weekly (Shangye zhoukan 商業周刊), a popular business magazine published in Taiwan, investigated the issue and concluded that “even under China's silver bullet offensive, the political position of Syuejia's fish farmers has not changed a bit.”Footnote 10 The Syuejia case has become an often-cited example of how economics fails to sway political attitudes. This article presents results from 18 months of fieldwork in Syuejia that challenge this widely accepted assertion. Fieldwork findings were cross-examined with data from recent presidential elections in Taiwan. In contrast to previous assumptions, this article argues that if economic favours are delivered and positive impressions created, as in the case of Syuejia, political attitudes can be reshaped. Nevertheless, the study also suggests that the “demonstration effects” of Syuejia have a rather limited impact on neighbouring regions owing to the lack of concentrated interests and positive impressions.Footnote 11 In other words, in particular circumstances, which are difficult to replicate, China's economic engagement can work. At the same time, it is because of these very difficulties that economic statecraft has little chance of successfully changing the current status quo across the Taiwan Strait more generally.
The article proceeds from a micro focus to more macro perspectives and conclusions. The following section sets out the background to the Syuejia fish-farmer case and discusses its particularities. The article then goes on to examine the tug-of-war between interests and identity by first tracing the changes in the attitudes of Syuejia's fish farmers and then by testing the hypothesis on electoral data. The conclusion addresses the strengths and limitations of China's economic engagement in reshaping cross-Strait relations.
Syuejia: Battleground of China's “Charm Offensive” and Taiwan's Political Resistance
Syuejia was chosen as the target of China's economic engagement policy owing to its previous political affinities and recent economic downturns. This small town thus provides a showcase of China's economic leverage and Taiwan's political resistance. There follows a brief history of Syuejia and an update of the current situation.
China's economic engagement versus Taiwan's political resistance
China first announced the doctrine of peaceful unification with Taiwan with Ye Jianying's 叶剑英 “Nine Points” in 1979. This doctrine, however, did not form China's policy towards Taiwan until Hu Jintao 胡锦涛 took control of foreign affairs in 2004. Before that, the Taiwan Strait was considered to be an East Asian powder keg.Footnote 12 This volatility stemmed from Taiwan's internal political dynamics in the 1990s.Footnote 13 With Taiwan's transition to democracy came rising ethnic nationalism. The island was later caught up in a vicious cycle of harsh exchanges with China that culminated in military confrontations in 1995, 1996 and 1999. Public opinion in Taiwan also gradually turned against the idea of unification, even though the two polities were becoming increasingly intertwined economically (Figure 1).
Figure 1: Structure and Trends of Taiwan's Public Opinion, 1994–2012
In an effort to resolve this contentious relationship, President Hu announced the “Peaceful development of cross-Strait relations” (liang'an heping fazhan 两岸和平发展). Under this new doctrine, China offered economic favours to Taiwan (huitai zhengce 惠台政策) and expanded social contacts across the Strait.Footnote 14 The general aim of the new doctrine was to “win over the hearts and minds of the Taiwanese people” (ji xiwang yu Taiwan renmin 寄希望于台湾人民).Footnote 15 Hu's approach differed from Beijing's earlier model of economic statecraft.Footnote 16 While both centred on the strategic use of economic engagement, the emphasis had shifted away from the deployment of sanctions to the offering of enticements.Footnote 17
Beijing's new approach received cooperation from Taiwan once the KMT reassumed power in 2008. In an effort to revitalize Taiwan's economy, the Ma Ying-Jeou 馬英九 administration removed the bans on cross-Strait exchanges. Direct flights, direct purchases, a more open domestic market, individual tours and new arrangements under the Economic Cooperation Framework Agreement (ECFA) all allowed China to reach the Taiwanese people directly.Footnote 18 Economic inducements targeting Taiwanese citizens soon became a core element of China's Taiwan policy.
China's recent economic engagement is primarily politically driven and guided by three concerns: the economic favours delivered must be substantive, perceivable, and effect changes in political attitudes.Footnote 19 China's new strategy is in this sense a “charm offensive.”Footnote 20 This “political use of economic engagement” is observable in the economically nonsensical trends in agricultural trade across the Strait. In theory, Taiwan, with its industrialized economy, should purchase more from a country with a developing economy and a huge agricultural sector, such as China. However, guided by the engagement doctrine, China has limited its agricultural exports to Taiwan for fear of upsetting Taiwanese farmers. Furthermore, it has encouraged agricultural imports from Taiwan to the benefit of Taiwanese farmers. These unusual trends began to emerge after 2008, when Ma took office and began to promote his pro-China policies (Table 1).
Table 1: Changes in Cross-Strait Trade in Agricultural Products (US$1,000)
Source: Council of Agriculture, Taiwan, http://agrapp.coa.gov.tw/TS2/TS2Jsp/TS20104.htm.
How much has China's new policy direction dented Taiwanese reluctance to unify? When attempting to answer this question, most scholars focus on the structure and trend of public opinion in Taiwan.Footnote 21 They report that economic engagement, despite having reduced Taiwanese hostility towards China, has not modified general Taiwanese political attitudes on: (1) independence/unification preferences, (2) Taiwanese/Chinese identity, and (3) pro-KMT or pro-DPP party identification.Footnote 22
This trend has surprised both those who endorsed and those who opposed the engagement policy, for both groups assumed a functionalist logic.Footnote 23 These functionalists refused to accept “premature assessments,” asserting that “it takes time for the economy to revise politics.”Footnote 24 The findings cited earlier are not clear as to whether economic engagement's apparent lack of efficacy is a result of economic benefits being “too late and not enough,” or if the policies are simply incapable of bringing about attitudinal changes. To sharpen the observable results and clarify the above problem, this paper focuses on the “sensitive groups” within cross-Strait exchanges. An examination of the case of the Syuejia fish farmers, who present a clear example of a “sensitive group,” can shed light on the tug-of-war between economic leverage and political identity across the Taiwan Strait.
China's economic statecraft and Syuejia's economic fragilities
Syuejia is a small town in southern Taiwan (Figure 2).Footnote 25 As mentioned above, it attracted nationwide attention during the 2012 Taiwanese presidential election. But why was this small town considered such a crucial battleground in the fight between economic interests and political identity?
Figure 2: Tainan and Syuejia
First, China's engagement policy was primarily targeted at Taiwan's pro-DPP voters because of the party's clear stand against unification. Tainan 臺南 was the DPP's biggest stronghold of support within all Taiwan, and within Tainan, the Syuejia electorate was among the firmest of supporters (see in Table 2). The residents of Syuejia mostly speak Hokkien (southern Fukienese), are generally not highly educated, and customarily earn their living through farming and fishing. These are all typical characteristics of DPP supporters. As such, China launched its “charm offensive” against the town's population. In this sense, Syuejia poses a “least likely case”: that is, if Beijing can sway the political attitudes of the Syuejia residents, the prospects for success in other locales become brighter.
Table 2: Political Affinity in Terms of Votes for the Pan-Green Camp in Presidential Elections
Source: Central Electoral Committee, Taiwan.
Note: Top row indicates number of votes; second row indicates vote share.
Fortunately for China's purposes, Syuejia was desperately in need of a financial bail out. Its economy relied on a combination of milkfish farming and workers’ remittances. Syuejia's fish farms, however, were totally wiped out by Typhoon Morakot in 2009, leaving many families in debt. In the years that followed, Syuejia was remembered for turning off its street lights in a bid to reduce the municipal electricity bill. Syuejia's economic woes thus provided China with an opportunity to co-opt one of the DPP's staunchest pillars of support.Footnote 26 First, milkfish was listed among the 18 items on the “early harvest list” of the ECFA. Then China announced its contract farming programme, and Syuejia thus became a critical test case for the effectiveness of China's economic engagement.
The contract farming programme was originally devised for Syuejia but with an eye to applying it elsewhere in Taiwan at a later stage. Under the programme, Syuejia's fish farmers signed a contract with a state-run corporation from China, initially Shanghai Fisheries (SF) and later Fujian Haikui Fisheries (FHF). The farmers then received a down payment which allowed them to start raising the milkfish.Footnote 27 After about six to eight months, the fish were harvested and sold to a Chinese dealer at a guaranteed price, which was about 15 to 25 per cent higher than the average price offered by local dealers. The programme was administered by the Taiwan Office of the State Council of China. To make the programme work, a new fish dealer, Shine Jia [Syuejia] Food Company (SJFC), was established as the intermediary dealer. The SJFC and SF/FHF signed the first one-year contract in March 2011, and recruited 100 fish-farmer households, with the aim of procuring 18 tons of milkfish per household. Soon after that, the fish farmers received a US$3,000 down payment. The first harvest of milkfish was shipped to Shanghai on 25 August 2011, and no tariffs were imposed. In December of that year, about nine months after signing the contract, all of the farmers received the remaining balance owed to them. The second contract then started in 2012, the third in 2013, the fourth in 2014, and the fifth in 2015.Footnote 28 Details of the five contracts are listed in Table 3.
Table 3: The Evolution of the Contract Farming Programme in Syuejia
Source: Shine Jia Food Company.
Notes: *Derived from our interviews; the exact numbers have not been formally announced. ** Allowing subcontracting to other fish farmers.
The contract farming programme has greatly improved Beijing's ability to co-opt Taiwanese farmers. Unlike previous approaches, the programme has several advantages. First, it helps to stabilize the market price. Stable prices benefit the participants without harming non-participants or customers. Second, since all the favours are bestowed on a relatively small group of beneficiaries and other non-participants are effectively excluded, it is easier for the interest factor to take effect.Footnote 29 Finally, the contract farming programme creates common interests between the farmers and China, and the beneficiaries can be held accountable.Footnote 30 The programme can be said to be the latest in China's efforts to co-opt Taiwanese loyalty and Syuejia a critical case to test whether the “charm offensive” works. Consequently, what is happening in this small town has attracted a great deal of interest.
What has China achieved? The Business Weekly investigation
Since China's economic engagement strategy aims to overcome Taiwan's political resistance, the success of contract farming in this respect must be assessed by observing the resultant changes in Syuejia's political landscape. Business Weekly was the earliest periodical to follow the story. The magazine first sent an on-the-spot reporter and later commissioned a survey.Footnote 31 The magazine's writers concluded that “contract farming failed to achieve its goal, for the party affinity of the Syuejia residents has not been changed.”Footnote 32 This finding was seemingly confirmed by the result of the 2012 presidential election, as the DPP increased its vote share in Syuejia by 3 per cent. Following the conclusions drawn by Business Weekly, all the mainstream media in Taiwan accepted that China's “charm offensive” efforts were futile.Footnote 33
Was the contract farming programme a total failure in this respect? We have several reasons to be sceptical about the findings presented by Business Weekly. First, there is a problem of timing. October 2011was too early to evaluate the effectiveness of that programme; purchases and payments had not yet been made, and the next year's contract was still pending.Footnote 34 Second, the survey is based on a random sample drawing from all the residents of Syuejia. Only about 500 to 600 households participated in the programme, compared to a local population of 20,000. The participants thus account for a small fraction of the Business Weekly survey sample. Of course, it is possible to properly survey the participants but the journal did not do so. Finally, the survey's results were less conclusive than they were broadly claimed to be. More precisely, the survey discovered that “in Syuejia, the DPP (57 per cent) still has a lot more supporters than the KMT (43 per cent).”Footnote 35 This finding is different from the reported conclusion that “the party affinity of the Syuejia residents has not been changed.”Footnote 36
Changes in the Political Attitudes of the Contract Farming Programme Participants
Following the above mentioned controversy, we carried out field research in Syuejia from September 2011 until the summer of 2013. During this period, we conducted in-depth interviews with the farmers who participated in the second round of fish farming contracts (2012–2013). Even after these interviews, we returned to Syuejia multiple times. We also triangulated our field findings with the election results.
How do fish farmers view contract farming?
Unfortunately, a few months after we began our fieldwork, Syuejia came under the spotlight as reports questioned whether those involved in contract farming had been “bought,” and the programme quickly became a very sensitive topic for participants.Footnote 37 To counter this problem, we used a combination of several research strategies. The authors had the full support of the SJFC and were personally introduced to the local fish farmers by its staff. This support was both owing to our affiliation with the respected National Chengchi University and also because the SJFC's president wished to gather feedback from the farmers involved with the programme. We then used snowball sampling through neighbourhood networks to reach additional interviewees, a method which helped to build trust. Following multiple visits and casual conversations, we interviewed respondents who felt comfortable enough to answer survey questions. As a result, only those with whom we were familiar were finally surveyed in September 2012, i.e. 62 fish farmers out of a total of 120, and 59 of our respondents were participants in the first round of fish farming.
The survey questionnaire began by urging participants to evaluate the programme and then asked whether they wished to continue with the programme. If contract farming does bring benefits, how significant are those benefits? We asked the participants how the programme affected their daily livelihoods. The responses are summarized in Table 4. As can be seen, 91.9 per cent felt that the programme had greatly boosted their income and that terminating the programme would significantly impact their livelihood. These responses are evidence of how contract farming participants perceive the economic benefits (Table 5).
Table 4: Approval of Contract Farming
Source: Authors’ field research, July and August 2012.
Table 5: Economic Effectiveness of Contract Farming: General Implications
Source: Authors’ field research, July and August 2012.
Political attitudes and impressions of fish farmers
If contract farming is so popular, then who receives the credit? Respondents’ positive perceptions can be traced by asking questions about who is the most popular figure among fish farmers. In Table 6, the DPP's chairman and presidential candidate, Tsai Ing-Wen 蔡英文, lags behind the KMT's Ma Ying-Jeou. Likewise, the same can be found for the DPP's Lai Ching-Te 賴請德 and the KMT's Li Quan-Zhao 李全教.Footnote 38 However, none of these figures is as popular as Zheng Lizhong 郑立中, the vice-chairman of China's Taiwan Office and vice-chairman of the Association for Relations Across the Taiwan Straits (ARATS). Our survey clearly indicates that the DPP loses points while the KMT makes gains, but the CCP receives the most credit.
Table 6: Political Consequences of Contract Farming: Popularity of Politicians (%)
Source: Authors’ field research, July and August 2012.
Note: Most favourable = 10 points; least favourable = 0 points.
Zheng's popularity derives from his association with the contract farming programme.Footnote 39 Soon after milkfish were listed on the ECFA's “early harvest list” in August 2010, he visited Syuejia and made direct contact with fish farmers. It was during these personal exchanges with residents that Zheng first learned about the problems with price volatility and fish brokers. Later on, when he met the local politicians, Zheng promised to push for contract farming. When drafting the programme, he insisted on including lower-income families and helped address the problems of storage and processing. For his efforts, Zheng gained the moniker “father of contract farming.”
Zheng continued to visit Syuejia and listen to the local farmers. One farmer told us, “we met him more often than the head of [Taiwan's] Fisheries Agency.” Previously, Zheng, a native of Fujian province, was Party secretary of Zhangzhou 漳州 and also of Xiamen 厦门, both in Hokkien-speaking regions, and so he had no problem communicating with Syuejia residents. According to one interviewee, “he normally sat in the open space in front of the fish farm, eating the rice-noodle soup … and referred to everyone by their nicknames.” Another informant observed, “everywhere [Zheng] went, he kept notes himself, and was quite familiar with the details of every problem.”
It appears then that Zheng won over Syuejia's fish farmers, but what were their impressions of the Chinese regime? How do those positive impressions affect the policy positions of local farmers? The results are summarized in Table 7. More than 80 per cent of participants adjusted their views on China and 70 per cent of them supported “cooperation on both economic and political issues.” It is important to note that not long before, almost all the farmers were firm supporters of the DPP.
Table 7: Political Consequences of Contract Farming: Impressions of China
Source: Authors’ field research, July and August 2012.
From our interviews with these participants, we drew the following conclusions. First, these participants were happy with and willing to defend the programme. Second, these farmers’ positions on general political issues were considerably different to those of traditional DPP supporters, very likely owing to the effects of the programme. Third, respondents’ approval of the programme, their acceptance of Zheng, and their willingness to cooperate with China are entwined together, causing the spillover from the economy to politics.
The mechanisms that lead to attitudinal changes
As specified earlier, the motive behind the contract farming programme is to influence political opinion in Taiwan, making it a “charm offensive.”Footnote 40 Beijing uses economic enticements to overcome political resistance among the Taiwanese, a goal that can only be achieved if China portrays a friendly and attractive face. Do these favours, once accepted, help to form a more positive image of China among the recipients of the favours? This is the key question when evaluating the effectiveness of contract farming.
We use three ordered-logit models to assess the relationship between the respondents’ evaluations of contract farming and their policy positions regarding cross-Strait relations. In these models, we first hold constant variables such as unification/independence preference, experiences of visiting China, annual family income and family size. We then take into account respondents’ “impressions of Zheng” as a proxy for China's attractiveness. The results are reported in Table 8. From the statistics in Model 1, we find that “stabilizing the fish price” fails to exert a significant influence on “cross-Strait opening up,” suggesting that benefits alone cannot make a difference. In Model 2, we find that the newly introduced variable, “impressions of Zheng,” is significant.Footnote 41 Of course, this result does not mean that Zheng could have achieved this political miracle without the economic benefits he delivered to the fish farmers.Footnote 42
Table 8: An Ordered Logit Model of the Support for Further Cross-Strait Exchanges
Source: Authors’ survey.
Notes: The dependent variable of the model is the respondent's position on cross-Strait economic relations (“How do you feel about the current pace of opening up for cross-Strait exchanges?” Options: too fast = 1; just right = 2; too slow = 3). The results of the two-tailed significance test: ***p < 0.001; **p < 0.01; *p < 0.05. # If the respondent answers “very helpful” to the question “Is contract farming very helpful for keeping fish prices stable?” and strongly favours Zheng Lizhong when asked “How do you feel about following politicians?” (giving Zheng 6 points and above), the case is coded as 1; otherwise it is 0.
In other words, “economic interests” matter, but alone they are not enough to revise political positions. If economic interests are not sufficient to form positive impressions, they cannot reshape respondents’ political positions.Footnote 43 This hypothesis is further substantiated in Model 3: if the respondent gives credit to contract farming and simultaneously holds a positive impression of Zheng, s/he is more likely to support the further development of cross-Strait exchanges. This result further confirms the complementarity between economic interests and good impressions. Put another way, only when positive impressions are created can economic benefits successfully affect political views. Economic favours in this sense are necessary but not sufficient to make the “charm offensive” work.
Changes in the Political Landscape of Syuejia and Greater Tainan
Fieldwork data can illustrate the changes in the political attitudes of the programme's contract farmers. The data, however, have the following limitations. First, the number of participants is not enough to address the broader political implications of contract farming. Second, these participants are themselves stakeholders; they have incentives to hide their true preferences. Moreover, the common methodological problems of retrospective surveys apply here: it is not easy to verify respondents’ earlier attitudes and we are unable to trace fluctuating changes in these attitudes over time.
We therefore have to look beyond the fieldwork data and examine Syuejia's election records to gain a better illustration of the political implications of contract farming. Our study covers Taiwan's recent presidential elections from 2004 to 2016 because only presidential elections centre on national identity and cross-Strait issues.Footnote 44 Our focus is the votes gained by the major parties in Taiwan because these parties undertake interest aggregation and propose policy packages.Footnote 45 Moreover, in Taiwan political parties are organized along the unification/independence preferences of the voters: of the two major parties, the KMT is pro-unification while the DPP is pro-independence. Therefore, votes gained or lost by the two parties not only reflect the position of voters but also will shape Taiwan's China policy. Vote data, however, are aggregated, and it is difficult to single out confounding causal mechanisms. To address this problem, we apply the difference-in-differences logic to help pin down the political impacts of contract farming.Footnote 46
Direct impacts of contract farming: the case of Syuejia
To observe the changes in the political landscape of Syuejia, we start by comparing the DDP's vote shares in Syuejia before and after the introduction of contract farming. The election results of the four presidential elections in Syuejia are shown in Table 9. First, according to the mainstream media in Taiwan, the DPP gained more votes in the presidential election in 2012 than in 2008, suggesting that contract farming had failed to make a difference.Footnote 47 The 2008 election (65.17 per cent), however, is not a proper reference point, for it followed the DPP's “Watergate” moment, President Chen's corruption scandal, which resulted in a landslide victory for the KMT. The DPP's comeback in Syuejia in 2012 (68.37 per cent, which is 104.91 per cent of its share in 2008), and its further gains in 2016 (74.80 per cent, which is 114.78 per cent of its share in 2008), should not be simply understood as a negative response to the contract farming programme.Footnote 48
Table 9: Contrasting Presidential Election Results in Syuejia
Source: Central Electoral Committee, Taiwan.
Given the unusual political circumstances affecting the 2008 elections, we have elected to use the 2004 election as our reference point.Footnote 49 If we contrast the DPP's performance in 2012 against its performance in 2004, we reach a different conclusion to that drawn by Business Weekly: the DPP vote share in 2012 is 94.53 per cent of its share in 2004. Further, the DPP vote share in 2016 is 103.41 per cent of its vote share in 2004. These comparions suggest that the 2004 election is a better reference point, but this is just one small methodological step forward and not enough to definitively assess the political implications of the contract farming programme.
As can be seen from previous analyses, the election results in Syuejia are influenced by the factors that also shape the general trends in Taiwanese politics.Footnote 50 To assess the effects of contract farming properly, it is necessary to rule out – or hold constant – the influences of those confounding factors. Conventional multivariate analysis for statistical control, however, cannot apply, because the electoral data are aggregated. The best strategy here is to apply the difference-in-differences logic and thus contrast the changes in Syuejia with the changes in (1) the broader context and (2) in most similar cases. By doing so, the potentially confounding factors can be ruled out all at once.
We first compare the DPP's vote shares in Syuejia with those in Tainan City. The results are summarized in Table 10. As shown in the table, if the DPP's vote share in Syuejia in 2012 (68.37 per cent) is divided by its vote share in Tainan (57.72 per cent), the ratio is 118.45 per cent, and if that ratio is contrasted with the ratio from 2004 (i.e. 116.70 per cent), a new ratio of 101.50 per cent (2012/2004) is produced. This result indicates that there is a slight increase in the DPP's vote share in Syuejia and that, as of 2012, the contract farming programme has not yet been effective at changing political attitudes. If, however, the same calculations are applied to the 2016 election (110.78 per cent) and that result is contrasted with the 2004 election (116.70 per cent), the ratio becomes 94.93 per cent, a big drop in the DPP's vote share, suggesting that the contract farming programme probably has influenced political opinions.
Table 10: Contrasting Presidential Election Results in Syuejia and Tainan (%)
Source: Central Electoral Committee, Taiwan.
To double-check our conclusions, we then make comparisons between Syuejia and other very similar areas. We chose two neighbouring towns, Peimen 北門 and Cigu (Qigu) 七 股. These locations are remarkably similar to Syuejia in terms of physical geography, economic structure and cultural background (see Figure 3); however, the contract farming programme was not implemented in either town.Footnote 52
Figure 3: The Location of Syuejia in Relation to Peimen and Cigu
The election results of the three towns are summarized in Table 11. We compare the DPP's vote share in Syuejia and Peimen first and then follow the same logic used before to arrive at the vote share in Syuejia in 2012, which is then divided by the vote share in Peimen to produce another ratio of 103.83 per cent. If we contrast that with the ratio from 2004 (108.47 per cent), we calculate a new ratio of 95.72 per cent, indicating a dramatic decrease in the DPP's vote share in Syuejia. Performing the same calculations on the figures from the 2016 election (103.33 per cent), and contrasting that result with the vote share from 2004, gives a result of 95.26 per cent, suggesting that the effects of contract farming are substantial and persistent.
Table 11: Contrasting Presidential Election Results in Syuejia with Those in Peimen and Cigu (%)
Source: Central Electoral Committee, Taiwan.
Likewise, if we apply the same method to Cigu and divide the DPP's vote share in Syuejia in 2012 by its vote share in Cigu, a ratio of 98.86 per cent is calculated, and if we contrast that result with the ratio from 2004 (102.13 per cent), we produce a new ratio of 96.80 per cent. This again indicates a dramatic decrease in the DPP's vote share in Syuejia. Finally, if we do the same calculations to the 2016 election data (97.85 per cent) and contrast that result with the numbers from the 2004 election, we arrive at 95.81 per cent, which, once again, points to the effectiveness of contract farming.
To summarize, after ruling out potentially confounding factors, our findings are highly consistent: the DPP's grip over Syuejia has gradually weakened since the contract farming programme was introduced. Even though the margins of vote shares are quite small, they are clear enough to confirm the political effects of contract farming.Footnote 53
Demonstration effects of contract farming: the case of greater Tainan
Having invested enormous resources in Syuejia, China wants not just to reshape the political landscape of this one small town but also to set an example for other regions in Taiwan.Footnote 54 Therefore, we are also curious as to whether the political effects of contract farming in Syuejia have spilled over to the broader region, for example Tainan City.Footnote 55 Following the previous examples, the changes in the DPP's vote share in Tainan City are contrasted with those in the whole of southern Taiwan as well as with the two most similar cases, Chiayi 嘉義 County and Pingtung 屏東 County. The statistics are summarized in Table 12.
Table 12: Contrasting Election Results in Tainan with Those in Chiayi, Pingtung and Southern Taiwan (%)
Source: Central Electoral Committee, Taiwan.
Notes: Southern Taiwan includes Kaohsiung (Kaohsiung County and Kaohsiung City before 2010, and greater Kaohsiung City afterwards), Tainan (Tainan County and Tainan City before 2010, and greater Tainan City afterwards), Chiayi City, Chiayi County, and Pingtung County.
First, if we compare the DPP's vote share in Tainan with that of the whole of southern Taiwan in 2012, we get a ratio of 104.45 per cent, and if we compare that with the ratio from 2004 (105.02 per cent), we arrive at a new ratio of 99.46 per cent, indicating that there is no subtantial change in the DPP's vote share in Tainan. Likewise, the new ratio of the 2016 vote share vis-à-vis that of the 2014 vote share is 99.47 per cent. Again, there is no indication of any Syuejia “demonstration effects” in Tainan.
Second, if we go further and compare the DPP's vote share in Tainan with that in Chiayi in 2012, we calculate a ratio of 98.53 per cent, and if we compare that ratio with the ratio from 2004 (98.71 per cent), we arrive at a new ratio of 99.82 per cent, indicating almost no change in the DPP's vote share in Tainan in 2012. Likewise, the new ratio from the 2016 vote share (103.29 per cent) when compared to the 2004 vote share (98.71 per cent) increases to 104.64 per cent. Nevertheless this result is not consistent enough to draw any firm conclusions regarding the spillover effects of contract farming.
Finally, utilizing the exact same comparison, we compare the DPP's vote share in Tainan with that in Pingtung in 2012, which produces a ratio of 104.70 per cent. Comparing that with the ratio of 2004 (106.66 per cent) gives a new ratio of 98.16 per cent, indicating a small drop in the DPP's vote share in Tainan. Once again, the new ratio from the 2016 vote share (106.35 per cent) when compared with the 2004 vote share (106.66 per cent) is largely simliar: 99.70 per cent. The result is still too close to call.
To summarize, when comparing Syuejia both with the bigger Tainan City and with its close neighbours, Peimen and Cigu, we find concurrent evidence suggesting that, in marked contrast to these other areas, Syuejia's voting patterns have considerably and persistently changed since the introduction of contract farming. Yet, despite the fact that the contract farming programme was devised to sway Taiwanese attitudes more generally, we do not have any clear and concurrent evidence to confirm a spillover of the programme's effects from Syuejia to Tainan. In other words, the political impacts of contract farming are only evident in the place where the residents have directly benefited.
The Future of Cross-Strait Relations in Light of the Syuejia Case
China's trade with Taiwan is clearly driven by a political motive.Footnote 56 China's economic engagement is certainly a “charm offensive” targeting the hearts and minds of the Taiwanese people. The effectiveness of that strategy can be observed in cases like Syuejia, where there was strong political opposition to closer ties with China and where huge economic resources were deployed in a bid to overcome this opposition. This study combines micro-level interviews with the participants of the China-led contract farming programme in Syuejia and macro-level comparisons of presidential electoral data to examine how effective China's engagement is and the reasons for any such efficacy.
According to the study, after allocating substantial economic resources and creating positive impressions, China's economic engagement has successfully altered the political attitudes and voting behaviour of many local residents.Footnote 57 This is no mean achievement, for Syuejia was a DPP stronghold. By comparison, however, we find no evidence of parallel changes in Tainan. In other words, where there is no economic benefit, there is no political leverage. Economic favours alone, however, are still not enough to sway political opinion. The changes in political opinions that occurred in Syuejia had a lot to do with the personal charm and charisma of the programme's frontman, Zheng Lizhong. In contrast, other beneficiaries of China's charm offensive, like the Taiwanese who conduct business in China and those who host Chinese tourists, show little sign of adopting a positive attitude towards China.Footnote 58 Our regression models also suggest that economic benefits are necessary but not sufficient; only when economic benefits successfully translated into positive impressions and both factors functioned jointly were the political positions of Syuejia's farmers finally impacted.
The success of China's charm offensive in Syuejia is enlightening: if China can influence the voting behaviour of Syuejia's residents, the prospects of success will probably be even brighter in other locales. Given the mechanisms specified earlier, can the Syuejia model be replicated in other places, and will the charm offensive eventually challenge the cross-Strait status quo? The short answer is no, for the following two reasons. First, the Syuejia model demands huge investment of both economic and human resources. The desired returns will only be seen after an extensive period of time. China has already spent US$20 million in its first five years in Syuejia, and probably still needs several years to consolidate its achievements. Syuejia is just one of 368 towns in Taiwan, and it was particularly vulnerable to this sort of economic leveraging; most other towns are richer and would probably require even more resources to effect any change.
Second, a “charm offensive” requires a friendly face if it is to succeed. Unless a positive image is created and maintained, the engagement and benefits on offer will not generate the political capital desired by China. Therefore, the agents sent by Beijing must interact in a personal, positive and respectful manner with those they wish to woo. Applying effective control over all the cross-Strait contacts to ensure that China's representatives portray a positive image of China, however, is very difficult. Cross-Strait interactions are fraught with all sorts of dangers. For example, those sent by Beijing could damage relations further or even end up being transformed themselves by their interactions with the Taiwanese they were sent to influence.
To summarize, this study suggests that China's economic statecraft is more effective than previous scholars and the Business Weekly investigation have argued. The contract farming programme in Syuejia does work. Without enormous expensive resources and carefully controlled contacts, however, the Syuejia experience cannot be replicated elsewhere. China's new version of economic engagement thus is very unlikely to disturb the status quo across the Taiwan Strait. After all, the charm offensive requires the intermediation of positive impressions, which cannot be bought just with money. In this sense, the Syuejia case illustrates both the strengths and limitations of using economic interests to influence political identity.
Acknowledgement
For their insightful and helpful comments, we are grateful to Tianbiao Zhu, Tun-Jen Cheng, Eric Chen-hua Yu, Wei Chen, You-Xiang Geng and two anonymous referees. We would also like to thank Wen-Tsung Wang, the CEO of the Shine Jia Food Company, Chang-Hao Wang, the president of the Tainan Aquaculture Development Association, and all the fish farmers who agreed to be interviewed. The collaborative research for this project would not have been possible without the financial support from the General Grants for Humanities and Social Sciences Research, the Ministry of Education of the PRC (Project Code: 14YJAGAT001) for Shu Keng; a Humanities and Social Sciences Doctoral Dissertation Award from the Ministry of Science and Technology of the ROC for Jean Yu-Chen Tseng; and the Special Research Grant for the Central Universities via the University of International Relations of the PRC (Project Code: 3262016T34) for Qiang Yu.
Biographical notes
Jean Yu-Chen Tseng is an assistant professor at the department of public affairs, Fo-Guang University in Taiwan. She obtained her doctoral degree from the Institute of East Asian Studies at National Chengchi University in Taiwan. Her research interests focus on international relations, comparative politics and cross-Strait relations, and in particular, the political implications of socio-economic integration between Taiwan and China.
Shu Keng is a research fellow at the School of Public Affairs, and associate chair at the department of sociology, Zhejiang University. He received his PhD from the University of Texas at Austin, and has published extensively on comparative political economy, Chinese political economy, government–business relations and cross-Strait relations, both in Chinese and in English.
Qiang Yu is an associate professor in the department of public administration of the University of International Relations in the People's Republic of China. Professor Yu earned his PhD from the Renmin University of China. His research interests include electoral politics, Taiwan and Taiwan–Japan relations.
