Nationalism versus globalization in Taiwan

¶ … press on globalization and its economic impact has focused on the incredible growth of China, Japan and Korea, Taiwan's emergence as a world player almost more dramatic. Once an ostracized island confederation, Taiwan has embraced the power of globalization and allowed itself to become of the growing number of success stories of the East Asian economic region. The question of how globalization emerged within our modern world and specifically within East Asia is a complicated one. It was the result of economic, political, social and cultural circumstances that were all perfectly in tune over the last quarter of a century. The Western conquest of the Asian region through Japan, Korea, Vietnam and other East Asian countries resulted in an influx of foreign capital as well as political and economic reform. It resulted in the forging of free-markets and greater transparency, both factors contributing to the growth in foreign direct investment. Political influences on trade and special privileges were granted to the Asian countries in order to stabilize their countries and that combined with growing need for manufactured products resulted in a booming trade process. The cultural and social values of hard work, nationalism and general adherence to the country's economic direction resulted in a dramatic turn around for the East Asian region. Slowly but surely, the Western nations became dependent upon the East for their productivity, and the escalation of interdependency has only increased in the past year rather than decreased. All of these factors have brought about an "unprecedented unity within this world." Scholars can identify many differing factors for the growth of globalization, including international confederations such as the United States and the IMF; however no single factor can explain the overall growth in interdependence within world powers.

The Asian development process has been heralded by historians and economists as one of the most successful development models within world history. It has led to hundred fold economic growth within the East Asian demographic. The model is a combination of many different economic factors that have resulted in building a system that maximizes Asian strengths while minimizing their weaknesses. At the same time, the East Asian zone has been able to shift along with an evolution within globalization trends. The Asian development process has emphasized growth through several different mechanism. First, it has relied on significant political reforms towards government controlled market expansion. Second, it relies on high stakes investments in education and technology. Third, it has changed its financial transparency and corporate governance to attract greater FDI.

The political shift within the East Asian sector is perhaps the greatest contributor to their growth model. While governments have not completely privatized nor have they created a market economy, they have pursued policies to nurture industrial growth and sustainable infrastructure. East Asian countries have pursued direct interaction between government and the private sector by creating strong lending policies that impact how the industries growth. Governments create an assortment of policies surrounding competition, taxation, workers compensation, etc. that allows creation of environments that are conducive for growth. This is the policy that both Korea and Japan has pursued by directly involving government in the process of decision making and working closely with the private sector. By protecting fledgling industries while still maintaining the freedom to pursue individual growth, industries have flourished within this system. Japan for instance, commands the highest trade surplus in the world, largely by leveraging the strength of their private sector through long-term relationship loans. Similarly the Chinese government has been able to successfully blend governance and free market through protecting certain industries through legislation and keeping certain key industries under government control. Instead of pursuing a "formalized process of results oriented investment. The Chinese government as well as other East Asian countries have pursued 'relationship banking' which focuses more on nurturing long-term growth rather than short-term profitability." The result of their financial, political and industrial process is to free the economy to operate but still protecting their growth.

The second driver of economic growth within this region is a high end investment in education reform and technology growth. East Asian nations on average doubly outpace investment in education than Western countries on a per capita basis. As a result, they have constructed strong technical institutions and devoted following for higher education. Technical university growth has doubled every year within China at minimum, while the same phenomenon is occurring in Singapore and Korea. The result of their core investment is that the nation has seen an insurgence of grassroots technology growth. This has had a dramatic impact the current prospects of the East Asian region as a hub for technology and engineering development. The quality and efficiency of development processes have increased and the core infrastructure of the economy has become much stronger as a result of their technology emphasis. This long-term benefit will sustain their national economy and expand market shares in terms of technology off shoring.

The final driver of the Asian model has been the escalating FDI that is occurring within all nations. Foreign direct investment began in the 1950s when the United States as well as many other European giants gave billions in financial assistance and FDI to developing Asian nations. This influx of capital has allowed these countries to grow and sustain the economy without having to rely on profitability as market standards. East Asian countries have changed their financial infrastructure not only to become more privatized but engage in less cronyism as well as present more accountability. Thus, countries are much more willing to place investment expenditure within the economy rather than providing aid. The net result is that manufacturing industries are booming as are off shoring and off source options for the majority of European transnational. By combining FDI along with a strong economic infrastructure for change, they are fully mobilizing their economy and changing the nature of their economic model to become sustainable in the long-term.

Globalization itself has evolved dramatically over the past two decades. While initially globalization was a small undercurrent process of resource distribution, where East Asian players were able to command much more economic power through global trade, today it has become a dominant theme in international politics and economics. The most evident changes are that globalization has become mainstream and thus, demands on nations are much more taxing on both an economic and political level. Reciprocation of trade agreements as well as demands for increased quality, monitoring, assurance and general fellowship have contributed to growing tension on the global level. The creation of consortiums and unions has also contributed to a greater necessity of political changes and pressures. Globalization has evolved from being a small part of the economic process, to the forefront of modern economic theory and government policy decision making.

The growth of globalization as it engulfs world politics and economic discussions have endangered the East Asian development model. Critics argue that the former "development" oriented infrastructure must be replaced with "neo-liberalism." However, Taiwan has escaped the clash between globalization and the East Asian economic model relatively unscathed. Not only did it weather the regional instability of the late 1990s and its ultimate financial crisis, but it has flourished within established sectors and shown that it is possible to become dominant within global supply chains. The striking ability of Taiwan to have escaped these problems are evidenced in their ability to beat competitors and entrench itself in the global supply chain. The following will explore several factors that have contributed to Taiwan's ability to mitigate the wealth distribution of globalization and continue to outpace projections on national economic growth. However, globalization has still caused problems for Taiwan on many different levels.

Taiwan serves as a semi-periphery on the world stage. While it is not considered an economic powerhouse, it has been able to retain high economic growth and per capita income for its citizens. At the same time, Taiwan experiences a myriad of economic problems that mitigate their success, such as the growth poverty rate as well as rising unemployment. The Kuomintang (KMT), the ruling party of Taiwan until 2000, created a strong economic process to protect Taiwan from economic reliance, but also entrenched itself in the global pipeline. Since Taiwan served as a gateway to China, it became part of the formation of transnational production networks. It focused its economy on high technology as a result; they have been able to negotiate high stakes manufacturing agreements with many Western transnational corporations. Taiwan plays a crucial role within globalization because it becomes a filter for the West into the East. it's reliance upon the United States for economic, political and more importantly, military protection allows it to have a privileged position in accordance with Western superpowers. It serves as a functional portal to the east that transnational corporations as well as the United States can leverage to gain influence within the East Asian region.

The geographical location of Taiwan makes it perfectly situated as a "gateway of East Asia." It shares close proximity with China, Singapore, Thailand and a myriad of other East Asian countries. Not only does this benefit them as a port destination, but the influx of trade goes through Taiwan with the majority of manufactured goods of the Pacific region flowing through their ports. Since Taiwan has a favorable relationship with the Western states, it has been able to absorb the growth of the East Asian region and serve as an effective broker for traffic of goods. Thus it plays a central role within the region as a broker between lesser developed nations and the developed super powers.

Not only does Taiwan hold an enviable position within global trade, but it also has developed its internal capacity to become a manufacturing force. Taiwan has focused its industries on two key developments, high end technology products including semi-conductors and high end technology product development. The Taiwan Semiconductor Manufacturing Company is the world's largest independent semiconductor foundry. As a joint venture through subsidized state funding, TSMC is one of the most powerful and technology oriented semiconductor companies in the world. Advances within Taiwan technology innovation have pushed its capacity beyond their limits of population and workforce. As a result of their high end production and strategic supply chain advantage. Taiwan is able to attract market capitalization from ATI, Broadcom, Conexant, Marvell, and NVIDIA among other very prominent transnational powerhouses. The estimated market capitalization of Taiwan's semiconductor industry is over 82 billion dollars. In addition to their astounding growth within the semiconductor business, Taiwan has been able to nurture an environment of high technology growth within software and hardware manufacturing. They are Apple's principle chip manufacturer for the past decade as well as part of IBM's network of dealers.

The combination of high investment in education as well as their position as a global and regional resource within global supply chains as allowed them to cultivate a very well trained workforce focused on developing high end manufacturing products and focused on innovation. One of the reasons that Taiwan has succeeded as a global player despite the wavering of other East Asian regional player is their ability to innovate and the strong entrepreneurial roots within the nation. One of the principle characteristics of its business development and industrial sector is their "daring entrepreneurship." Over fifteen percent of Taiwan's overall resources are based within startups. Through its unique high end skill level and systematic human resources and risk takers, Taiwan has emerged as a global force throughout the industry.

Finally, Taiwan's location as a primary port nation for the East Asian region has allowed them to become a manufacturing integration center. They are at the nexus of American research and development, Hong Kong commerce, and Chinese raw manufacturing. By connecting all three levels of these facilities they have been able to quickly integrate themselves to become an integral part of the development process. This has culminated in their ability to quickly expand beyond focal points and work within high margin industries rather than focus purely on manufacturing output.

There are significant opportunities for Taiwan within the new world of globalization. However, along with these opportunities come significant risks that have caused the Asian sector in general to destabilize. Taiwan has excellent relationships with the international community, as part of the WTO they have legitimized their legal system much more than most East Asian players to become one of the most friendly atmospheres for foreign investment. Thus, they become an ideal opportunity for cooperation with foreign investors towards greater foreign direct investment within their economy and provide an access point to the Asian market. Protecting Taiwan's positioning within the globalize world has become reliant upon laws and policies that makes Taiwan part of the global supply chain. As part of the huge investment in worldwide commerce, and its positioning in the Pacific, Taiwan has already built a vast network within manufacturing and supply chain distribution. They have enacted numerous laws that protect their relationships by providing built in advantages for favored Western relationships. Taiwan for instance provides tax exemption for high technology transnational that choose to build manufacturing operations within the Taiwan mainland. They similarly offer very generous compensation to returning nationals pursuing entrepreneurship. The Taiwan government ranks fifth in the world in overall expenditure on start-up funding. They have built numerous billion dollar incubator efforts throughout Taiwan and focused on Taipei to increase the level of innovation and entrepreneurship on the mainland. These investments have yielded significant benefits for their economy as they are carefully pursuing strategies for growth and expansion into various high technology areas. In addition to their current protective measures, the Taiwanese government has created increasingly complex financial safeguards to protect wealth management and investiture within key industries. Transparency in the federal banking system as well as decentralization and market utility for foreign banks has helped Taiwan expand their current financial infrastructure.

The entrance of Taiwan to the WTO has not only influenced Taiwan economically and politically, but also in their cultural edifices. Taiwan has changed its approach to immigration as well as transnational business by allowing for greater equality of access to their domestic markets. As a result, there is an influx of immigration to Taiwan not only from mainland China, but throughout the East Asian region. This has helped to create diversity within their culture as well as create new economic classes. In the short-term this has provided dramatic change and problems for the government has it believes that unemployment increases of four percent over the past two years can be attributed to growing immigration. However, in the long-term, it will serve to strengthen their economy through a diversification of resources, labor and intellect. At the same time, Taiwan has increased government grants and scholarships for travel study abroad for Taiwan nationals in the hope of developing high caliber talent that will speed its high technology development. Since 2004, Taiwan has increased its dedicated budget for higher education by 20%, with the majority of this money going towards the development of technical colleges focused on computer engineering. They similarly have devoted resources to the development of logistics and the distribution business, HR training, healthcare, communications among myriad of other innovations. Their concessions to the WTO also have involved creating a new environment for cultural and economic growth. The Taiwanese government has agreed to assist the agricultural industry in upgrading their current technology and general operations by improving the distributions infrastructure within Taiwan. Thus adding to an increasing level of environmental protection, recreation and tourism.

However, globalization has not meant unmitigated success for the Taiwanese community and economic status. It has caused severe social, cultural, economic and political turmoil. First, the entrance of transnational players as part of WTO's preferred trading program has allowed major transnational such as Wal-Mart to enter into the Taiwanese marketplace. Although it is still too early to see if this will have a clear impact on the future of Taiwan's small business development, already such global players have invested billions of dollars to absorb major burgeoning industries within Taiwan. This is a major concern going forward is the possibility of usurpation of market share from internal industries and the growing reliance upon foreign players. Taiwan has to carefully watch its domestic industries to ensure that they are not completely subsumed by growing transnational market pushes. At the same time, the influence of aggressive foreign investment has led to pressures to change the Taiwanese government. Taiwan is heralded by many western powers as the ideal example of a working democracy within East Asian culture. However, the reality is that the state still exerts significant influence on industrial, cultural and social disciplines. Foreign players are pushing for Taiwan to continue their privatization and to create a market economy to allow for complete foreign access. Much of the major political changes within Taiwan have been part of bargaining agreements with foreign superpowers, especially the United States. The complete reliance of Taiwan upon U.S. military protection has made them vulnerable to power plays by the U.S. government. Thus, it has made major concessions within areas of trade and political reform in favor of the United States.

In the midst of the growing economic and political power of Taiwan in world affairs is the duality of its nationalist sentiment. Nationalism is a very strong ideal of the Taiwanese populace, not only because of their status as elite of the East Asian region, but also the political history and embittered past defeats at the hand of the communist regime of Mainland China.

Nationalism at the general level can be understood as a devotion to one's nation and the interest of that nation over all others. This is much more a political doctrine and a philosophy than any individual stance.

It is the understanding that as a nation, each individual must hold it sovereign and respect its autonomy. Nationalism can be understood in the context of national pride and a sense of identity gained through independence. Nationality therefore is recognized as one of the strongest forms of personal identity that must be held over other forms of identity. Taiwan has had to fight tremendous forces to forge its national identity and faces the constant crisis of being eclipsed by the red forces of Mainland China.

It is caught between many historical battles for land, and through it all they have forged a unique national identity.

Although Taiwan has been typically lumped with China, there is a distinct difference between Chinese nationalism and Taiwanese nationalism. Taiwan has repeated attempted to become an independent nation outside of China. There have been numerous movements to forge a Republic of Taiwan that has a place outside of the Republic of China. Chinese nationalism has its roots in over five thousand years of history. They arose out of mixture of historical and cultural background as well as contemporary aspects that have shaped their national identity. Chinese traditional thinking and cultural identity can be rooted in the Han dynasty, the first unified dynasty within China. The majority of Mainland Chinese consider themselves the descendents of Hans. Thus their nationalism is manifested as a reflection of past values, such as their devotion to Confucian doctrines, the Three Principles of the People developed by the Nationalist movement, and the Communist Party movement. This amalgamation of influences is distinctly Chinese and takes on strong cultural roles that present itself in deep Chinese pride. In contrast to this viewpoint, the Taiwanese nationalist movement believes itself much different. Taiwan itself was not taken over by the Chinese immigrants until the 1950s, when the Kuomintang under Chiang-Kai Shek was forced to move to the Taiwanese mainland as a result of the Communist takeover. Historically, Taiwan has always been a colony of various East Asian superpowers. Originally it belonged to Japan as a colony, with much of its traditional culture descendent from Japanese traditions. During the late 19th century and early 20th century, the Japanese gave way to strong influences by the Dutch and the Spanish. Western traditions were implemented within Taiwan, as these two superpowers saw Taiwan as an ideal port colony for access to the East Asian region. For the Taiwanese, only a very small part of their culture can be understood in the context of Chinese history and traditions. Although many Chinese immigrants moved to Taiwan during the Ming and Qing dynasties at the bequest of the Emperor, they were only a minority within the Island territories. Thus, Taiwanese nationalists argue that while Chinese culture, traditional and history plays a role within their understanding of Taiwanese heritage, it is only a part, and not the whole. This is the principle difference between these two national forces.

Contemporary Taiwanese identity is forged through an amalgamation of all of the forces that are at play within the Taiwanese demographic. Taiwan has become a "melting pot of the East Asian region." It has strong minority ethnicities from India, Singapore, Thailand, Vietnam and many other sub-ethnic groups within the Asian region. As a result, the contemporary identity of the Taiwanese people is integrated across cultures. Mixed marriages are very common within Taiwan and cultural identity has been forged through an understanding of democratic acceptance of differences. Few Taiwanese can define themselves under the strict nationalism of China, nor under any one established heritage. Rather they have enjoyed the mixture of cultural edification that result from being at the cross pattern of global trade and distribution. The inevitable result is that at a cultural level, a new nationalism has arisen to protect and sanctify Taiwanese identity beyond the acceptance of traditionalized ideals. The Taiwanese people assert that they want to be free from judgment and confinement accordance to tradition, because for the largest extent they are far from being socially definable.

Immigration within Taiwan is one of the hottest issues in both national identity and political realms. Taiwan has one of the lowest birthrates in the world and as a result, seeks consistent influx of immigrants to fill its ranks and provide for the expansion of their industries and overall human resources capital. The result is that immigrants seek citizenship and contribute to the growing complexity of their identity and culture. Since the decline of the Kuomintang and the ascension of a new Taiwanese democracy, it has become evident that Taiwanese culture and nationalism is wholly unique and different from mainland China. While in the past it may have been said that Taiwan was a subset of the Chinese heritage, the opposite can now be said, where China is a subset of Taiwanese heritage. All of this changing self-identity has been occurring over the past decade, with a strong emphasis on the youth movement. This has resulted in dramatic changes in many aspects of Taiwanese culture.

The growing independence of the Taiwanese population along with the expansion of the immigrant class has resulted in a push towards localization. The Taiwanese people are attempting to distance themselves from the Chinese Mainland by pursuing a greater emphasis upon their local history. Recent legislation has changed to allow for greater access and emphasis on Taiwanese history within schools as well as media outlets. The TCV, one of Taiwan's premier television broadcasting networks have become devoted to providing aboriginal news and events. They also have begun using localized dialects and traditions rather than mandarin. Reforms to Taiwanese textbooks on their history have been changed to reflect Taiwanese traditions and indigenous culture rather than Chang Kai Shek and the Kuomintang. The educational system now teaches both the history of China as well as the history of Taiwan to represent the dualism of their culture and heritage.

There have been numerous movies that display and imprint Taiwanese nationalism. It has also become evident that Taiwanese entertainment and culture have become mainstream within the globalize world. Director Ang Lee is one of Taiwan's most prominent movie directors, following a very successful career in Taiwan he has gone on to win an Oscar in the United States. However, his breakout film, Crouching Tiger, Hidden Dragon is an example of the melding of Taiwanese and Chinese cinema; it has elements of traditional Chinese themes and martial arts, but is combined with unique Taiwanese themes as well as cinematography. Ang Lee has not only become extremely popular within Taiwan but is also an icon within mainland China. Many Taiwanese entertainers in both movies and music have influenced the Chinese mainland, which shows that power that Taiwan exerts on the world stage. As a nexus point of different cultures, Taiwan has become a trendsetter rather than a trend taker in its music, film and arts. Movies in and of themselves reflects nationalism. The movie, "Memoirs of a Geisha" was shot by an American and the actresses within the movie are Chinese. This greatly angered the Japanese government and people because they felt that they were wrongly portrayed. The Japanese not only banned the movie from Japan but sent heavy criticism to the American film industry, not allowing the filming of the movie to take place within Japan itself. The combination of all of these factors shows how strong nationalism sentiment can impact even movies. Taiwan has shown similar protectionist steps within its cultural heritage by emphasizing specific Taiwanese themes and historical traditions within their movies. This has helped to popularize them throughout the world

The nationalist sentiment within Taiwan has clashed with the evolution of globalization within Taiwan and has become a hotly contentious area. One of the most prominent conflicts within this dialogue is concessions to the WTO that has sparked tensions among nationalists. As part of its stipulations for joining the WTO, Taiwan has had to decrease their protection of local industries and allowed foreign competitors in to enter their marketplace. Although this has provided a new source of competition for higher quality goods, for nationalists it represents a dramatic subversion of native cultures and traditions. Taiwanese nationalist movement's points to the disappearance of traditional storefronts and the financial difficulties department stores and supermarkets have placed upon family owned businesses. They fear that the influx of foreign competition will wipe out native industries and destroying many culturally desirable institutions through price competition. They insist that industrial protection and domestic tariffs are used to sanction trade and to ensure that local industries will still receive adequate protection from foreign competition. In such a way they will be able to protect overall interests without endangering the global position of its economic sector. Such a conflict between adhering to free market forces from foreign players and appeasing nationalist interests has made the WTO a source of both hope and hatred within the Taiwanese populace. Many see it as an opportunity for greater prosperity and higher quality of life, while others see it as a force for cultural destruction and general cultural genocide.