Taiwan's choice and its possible consequences

January 08, 2024

On January 1, 2024, the BRICS, ideologically, economically and financially led by China, got five new fully-fledged members (including Iran and the Gulf countries, which are in confrontation with each other). This may well testify to the efficiency of China's political and diplomatic efforts aiming at global leadership.

However, paradoxically, one more trend is observed. It appears that China attracts geographically distant countries, while its neighbours do not show enthusiasm or support the growth of the Chinese influence. Moreover, the tension and confrontation between China and its neighbours in the South China Sea continue to grow from year to year, bearing evidence of regional risks rather than benefits. Indonesia, Vietnam, the Philippines, Taiwan, Hong Kong, and Japan are trying to expand and strengthen partnership with the USA, Great Britain, and Australia.

In certain areas, this brought apparent results. In particular, in 2022, international support from the democratic community for the Ukrainian people struggling against the Russian invasion actually saved Taiwan. Today, the risks of an armed conflict around Taiwan are much lower, and their further trend largely depends on the results of the elections later this week. The chances of victory for pro-government and opposition political forces are approximately equal. So even if the Democratic Progressive Party ruling now wins the elections, it will not be easy for it to form an efficient parliamentary majority. Therefore, the new government will probably be aimed at finding a compromise. Of course, the issue of Taiwan's rapprochement with China will dominate the agenda, and if forcible confrontation is prevented, there is hope for easing tension between the United States and China (an alternative to this will be mutual harsh accusations of falsification, which can easily end up in a military confrontation).

However, Taiwan should watch out. The developments and trends in Hong Kong in recent years serve as a warning. One of the previously most successful Asian "tigers" is being gradually absorbed by the PRC (moving from "one country, two systems" to "one country, one system"), with political and economic losses and risks, and in a few decades may become just a minor province. Let's note the noticeable deterioration of Hong Kong's economic dynamics (chart "Economic growth rates"). Hong Kong's economy actually stopped growing, its attractiveness for investors fell significantly, and the social and democratic achievements of the previous decades fade out. Moreover, a number of indicators that characterize the system of public administration are substantially deteriorating (diagram "Indices of democratic freedoms"). Apparently, the system of Hong Kong’s subordination to China demonstrates the trends of the big one swallowing the better and the smaller.

Economic growth rates
, % to the previous year

Indices of democratic freedoms

▬ voting rights

▬ political stability

▬ rule of law

Another risk factor from China originates from its aggressive expansion in the South China Sea. Artificial islands, military bases, provocative exercises are intended to demonstrate who the "master" in the region is. Recently, a map of the territories that Beijing considers its own was made public. It turns out that China claims most of the South China Sea, including territories that are internationally recognized as parts of the economic zones of sovereign countries (Indonesia, Vietnam, the Philippines, Malaysia), actually trying to turn the external sea into an internal one (doesn't it remind you of anything?). In such conditions, proposals to create a "code of conduct" to prevent military actions in the South China Sea seem strange. The appeals of the countries of the region to the USA and its allies for protection seem more reasonable and grounded, as in the case of the Philippines in the fall of 2023 after another escalation in the "disputed water areas".

In this context, the election results in Taiwan may become a catalyst of political and security processes in the region. The victory of the forces supporting China's expansion would mean the increased exposure of many other countries to such expansion and in fact complete maritime dominance of China in the region. Despite the conflicts in China's relations with the neighbouring countries, there are reasons to expect the prevalence of rational approaches to the solution of conflicts. However, recent events clearly show that large emerging countries tend to expand outward, trying to extend their influence even to the territories where peoples have already built new societies and new systems.

It may be sad to admit but Ukraine is also on the list of Russia’s imperialist encroachments. Sad, as it means the risks of continuation of the war. At the same time, there are good indications that partner assistance of developed countries can be an efficient tool for strengthening the security and freedom of countries that have chosen a democratic path of development.


Vasyl Yurchyshyn

Director, Economic Programmes

Born in 1955 in Kamyanets-Podilskyi.


T. Shevchenko Kyiv State University, Department of Cybernetics (1977).

Institute of Public Administration and Local Government at the Cabinet of Ministers of Ukraine (1994).

Professor in Public Administration. Author of nearly 100 scientific works.


In 1977–1993, worked at the Kyiv University as an engineer, research fellow and senior research fellow;

1994–1999 — head economic researcher at the International Centre for Policy Studies, Fund for Banking and Finance Development;

1999–2004 — Assistant Professor, Department of Economic Policy of the Ukrainian (currently, National) Academy of Public Administration, office of the President of Ukraine;

1999–2004 — Research Director at the Agency of Humanitarian Technologies, later — Agency for Social Analysis;

2002–2003 — advisor to the Minister of Economy of Ukraine;

since April, 2004 — Professor, Department of Economic Policy of the National Academy of Public Administration, office of the President of Ukraine;

since June, 2005 — Economic Programmes Director at Razumkov Centre.

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