Taiwan's President Ma Ying-jeou Rebounds

Taiwan President Ma Ying-jeou, whose approval rating had fallen as low as 23.9 percent in March and April, has rebounded at the midpoint of his presidential term to 46.8 percent. While that is hardly a mandate from heaven, analysts are surprised at how far Ma has bounced back, firming up the Kuomintang government's grip on power.

The primary reason is the recent signing of the president's most important objective, the Economic Cooperation Framework Agreement (ECFA), between Taiwan and China which removed tariffs on hundreds of items – and far more on Taiwanese exports to China than China exports to Taiwan. While before final negotiations many Taiwanese thought the agreement would cause havoc with the economy, the pact now is widely seen as being considerably more beneficial to Taiwan than to China. The pact also appears to give the long-isolated island the ability to hold talks with other trading partners to become more integrated into the global economy

The president's job has from the beginning been to sell the ECFA to Taiwan's public. That has been a sensitive role, even down to its acronym, which at first was CECA – the Comprehensive Economic Cooperation Agreement – but opposition politicians said that sounded too much like CEPA, the Closer Economic Partnership Arrangement signed with Hong Kong and Macau – territories which are now part of China. Ma renamed it to make it sound more like FTA – free trade agreement.

Ever since the first announcements were made that the pact was in the works, the president has traveled the island seeking to justify an agreement with the former archenemy. In a recent press conference given to Japanese media, he described how his efforts went:

"On the streets, on the Web, in the newspapers – people spend the whole day scolding me. I have been scolded so much that I don't know where to start to respond," he said, emphasizing that whatever the reaction, it was of immense importance to keep on explaining and justifying.

It has been a bit of a roller-coaster ride for Ma, from his lambasting devastated villagers last year during the government's bungled response to Typhoon Morakot, which played a major role in driving down his popularity. Nor did he help himself any when he reversed a ban on US bone-in beef which was instituted when bovine spongiform encepholapathy, the so-called Mad Cow disease, struck US cattle. On Jan 5, in the face of outraged criticism, he was forced to reverse himself again, banning some of the controversial U.S. beef imports.

But the sturm und drang that characterized relations with China during the presidency of the disgraced Chen Shui Bian has disappeared without overly earning the distrust of the Taiwanese public. With Taiwan's export-oriented economy tanking because of the global financial crisis of 2008-2009, help from China is no longer regarded as traitorous. Other important agreements have been signed including the launch of regular flights across the Strait, joint assistance in cracking down on crime and improving mutual judicial assistance, which have been regarded as popular by the public while not giving away too much to the Chinese.

Certainly, Taiwan got considerably more out of the free trade agreement than China initially meant to give since Ma was given two unlikely tools -- Beijing's concern over the possibility of a high-profile failure of negotiations and Taiwanese opposition parties' ability to mobilize large scale demonstrations and drives for referendums, causing Beijing to start doubting Ma's ability to rein in his domestic opponents.

Beijing thus allowed Taiwan to place as many as 539 Taiwanese products and services on the 'early harvest list' to enjoy tariff cuts or other advantages -- more than double the corresponding figure of 267 Chinese products and services. Taiwan is to enjoy an about five-to-one ratio in export value compared to China. According to media estimates, tariff reductions will increase Taiwanese trade by US$13.4 billion and Chinese trade by US$2.9 billion. Beijing even risked a backlash from its own businesses complaining about preferential treatment for Taiwanese companies.

"The Chinese negotiators originally proposed opening the Taiwanese market to more than 700 items, but the Taiwanese negotiators rejected more than 500 of them in just five minutes," Taiwan's Bureau of Foreign Trade Director-General, Huang Chih-peng, boasted.

Beijing's generous concessions, which were published shortly before the signing, clearly did their job. Instead of a crowd of 100,000 as previously forecast by the organizers, only a mere 30,000 turned up to the anti-ECFA rally in Taipei three days prior to the signing of the pact.

Ma succeeded because he has what China wants to take advantage of, and that is Taiwan's presidency and the chairmanship of the KMT, which has a comfortable plurality in Taiwan's legislature. He also understands that the Communist Party in Beijing does not want to see mass protests and referendums held in the 'Greater China' area and particularly in Taiwan as China seeks to woo the island state back into the Chinese fold.

Opposition was loud and bitter. Opponents forecast that it would cause a major influx of cheap mainland labor – including prostitutes and so-called minor wives. They also raised concerns that the ECFA would lead to the further hollowing-out of Taiwan's manufacturing industries, many of which have moved to China to take advantage of the cheap labor. Yet another of the opponents' fears is that since Article 11 of ECFA stipulates Beijing and Taipei establish a cross-strait economic cooperation committee to handle negotiations, implementation and interpretation of the agreement or disputes resulting from it, it is bound to create a supra-governmental body without accountability.

The calculation makes sense: China doesn't recognize Taiwan, so the Taiwanese members of the committee are not going to be elected people. Through the signing, Taiwan has at least economy-wise put all its eggs into one basket. Thus, the ECFA committee will wield enormous power, perhaps so much that neither legislature nor public could challenge its decisions. Talks on ECFA have from the beginning been very much China-style since about everything in the negotiation process happened behind closed doors. The agreement was initiated by unelected KMT officials such as party chairman and honorary chairman and Chinese officials making deals without legislative supervision.

In July 2009 the DPP started an anti-ECFA referendum drive. The opposition's constant petitioning for a referendum came in handy for the administration as a bargaining chip in cross-straits negotiations. It can safely be assumed that Beijing watched anxiously each time a spokesperson of Taiwan's Referendum Review Committee stepped in front of the cameras to make announcements on decisions made concerning the referendum.

Ma's popularity has been helped by the fact that Chinese industries are investing in Taiwan, driving industrialization and helping with the island's unemployment situation. In May 2009, the Ministry of Economic Affairs announced that Taiwan would open 99 service and manufacturing industries and business lines to Chinese investment.

To keep his base loyal, in early June domestic and international media picked up rumors that Taiwan's military had tested medium-range missiles capable of striking Beijing, Chongqing and China's giant Three Gorges Dam. Ma also reiterated his request for an arms deal with the US that included advanced F-16C/D fighters. His playing the strongman in military matters was meant to counter his reputation of being too soft in general and of being too submissive to Beijing in particular.

Perhaps because of Beijing's level of anxiety over the state of the ECFA negotiations, China softened its hallmark tirades against Taiwanese authorities that came with any of previous US weapons sales or rumors of Taiwanese missile tests.

These maneuvers helped Ma even in the south of the country, traditionally the opposition's stronghold. A DPP-sponsored event that was held in June in Kaohsiung in support of an anti-ECFA referendum didn't even come close drawing the anticipated crowds. Reuters reported that a low turnout at the event signaled a "broad but guarded acceptance of the deal by the Taiwanese public."

With the ECFA, China gave Taiwan a trade deal that arguably is envied by almost any country in the region. The benefit Taiwan is to gain out of the early harvest list almost mutes the domestic opposition. Since there has been much talk of Taiwan being able to negotiate on free trade agreements with other countries after the signing of the ECFA, the Ma administration has been painting the pact as being the very tool needed to break out of Taiwan's isolation on the international stage that had for decades gnawed at Taiwanese self-esteem. If the KMT succeeds in convincing Beijing not to obstruct Taiwan conducting bilateral talks, the ECFA would gain even more popularity among Taiwanese across the political sector.