Taiwan’s 2024 Elections

Since current president Tsai Ing-wen was elected in 2016, official cross-strait dialogue has been suspended, and there is deep concern about China’s growing use of “gray zone” tactics and the rising possibility of actual hostilities. With the elections now concluded and Democratic Progressive Party (DPP) candidate William Lai the victor, all eyes are on the ongoing transition, which will culminate in Lai’s inauguration on May 20.

Q1: Were the election results surprising?

No, the election results were largely in line with public opinion polls, which consistently showed Lai leading his opponents. Lai, who is currently vice president, ultimately won the election with just over 40 percent of the vote. The Kuomintang (KMT) candidate Hou Yu-ih placed second with 33.5 percent, and Taiwan People’s Party (TPP) candidate Ko Wen-je received 26.5 percent of the vote.

Also as expected, Lai did not win an outright majority of votes. That puts him in a significantly different political situation compared to current president Tsai Ing-wen, who won both of her elections in 2016 and 2020 with over 56 percent of the vote. Lai’s weaker performance is not due to the success of the main opposition party candidate; the KMT’s Hou received a smaller share of votes than the previous KMT candidate did in 2020. Instead, both the DPP and KMT saw their vote shares hollowed out by Ko of the TPP. Ko won more third-party votes than any candidate since 2000, when the KMT’s James Soong ran as an independent.

▲ Taiwan Presidential Election Results by Party. Source: Central Election Commission, R.O.C. (Taiwan).

The Legislative Yuan elections were also not surprising. The DPP lost several seats and saw its majority disappear — a fact that will significantly complicate Lai’s ability to push forward a DPP agenda during his presidency. Meanwhile, the KMT gained 14 seats, for a total of 52, just ahead of the DPP’s 51. The TPP netted three seats for a total of eight. This marks the first time since 2004 that no party won an outright majority and means that the TPP will play a decisive role in forming a coalition to lead the legislature.

▲ Results of Taiwan’s 2024 Legislative Yuan Elections. Source: Central Election Commission, R.O.C. (Taiwan).

Q2: What was Beijing’s initial reaction? Is this a huge defeat for China?

Beijing has taken several diplomatic measures in response to the election. Most significantly, just two days after the election, the small Pacific Island nation of Nauru announced that it is severing diplomatic ties with Taiwan and establishing relations with the People’s Republic of China (PRC). Taiwan’s Ministry of Foreign Affairs released a statement asserting that China has repeatedly engaged political figures there and offered economic assistance to persuade the island to switch ties.

The timing of this move is obviously intentional, and it is a well-worn tactic Beijing has used to punish and isolate Taiwan under DPP presidents. In March 2023, China poached another Taiwan ally, Honduras, and timed the move to coincide with President Tsai Ing-wen’s transit through the United States. Altogether, China has now lured 10 countries to switch ties from Taiwan to the PRC during Tsai’s tenure as leader.

▲ Countries Switching Diplomatic Recognition from Taiwan to China (2000–2024). Source: CSIS China Power Project.

In another display of Beijing’s influence, China reportedly pressured an international volleyball competition to relocate from Taiwan to Indonesia. China filed its protest over the competition in late December, but news of the move first broke on January 17, just days after Taiwan’s election.

On the diplomatic front, PRC authorities have issued statements criticizing the United States, Japan, and European countries for sending delegations to Taiwan in the wake of the election and criticized the U.S. State Department and the Philippines for issuing congratulatory statements to Lai. Importantly, however, the spokesperson of the PRC’s Taiwan Affairs Office put out a statement that seemed to somewhat downplay the outcome of the election: “Whatever changes take place in Taiwan, the basic fact that there is only one China in the world and Taiwan is part of China will not change; the Chinese government’s position of upholding the one-China principle and opposing ‘Taiwan independence’ separatism, ‘two Chinas’ and ‘one China, one Taiwan’ will not change.”

Beijing has also threatened economic penalties. Although both China and Taiwan are members of the World Trade Organization, their economic ties are primarily governed by the Economic Cooperation Framework Agreement (ECFA), which went into effect in 2010. In April 2023, Beijing launched a formal investigation into Taiwan’s compliance with the ECFA due to a long list of Chinese goods Taiwan bars from import to the island. China recently announced that Taiwan had violated its commitments and a few days before the election announced an initial list of minor penalties. It is possible Beijing will expand trade restrictions in the coming months and make it more difficult for Taiwan’s firms to produce in China, with a smaller possibility that it would outright suspend the ECFA.

So far, Beijing has not taken any major military actions in response to the election. The People’s Liberation Army (PLA) has not announced any large-scale military exercises akin to those seen in August 2022 in response to Speaker Nancy Pelosi’s visit to Taiwan and April 2023 in response to Tsai Ing-wen’s transit through the United States. According to regular releases by Taiwan’s Ministry of National Defense, no PLA aircraft were reported around Taiwan or in Taiwan’s air defense identification zone (ADIZ) on the day of the election.

However, the PRC did fly a high-altitude balloon near Taiwan’s northern coast on election day. Taiwan’s Ministry of National Defense began reporting the presence of PRC balloons flying around and over Taiwan in early December 2023, and the PRC has continued to fly these balloons frequently, including after the election. Additionally, after the election, from January 17–18, Taiwan reported 24 PLA aircraft flying around the island, with some of these conducting rare nighttime patrols.

Once again Beijing’s desire to see a more conciliatory party win the presidential election did not materialize. Chinese leaders can take some solace in the fact that Lai did not win an outright majority and that his presidency will be constrained by the DPP’s loss of the legislature. They can also see some rays of hope given that the DPP moderated its policies over the last eight years under Tsai and did not more aggressively push for outright de jure independence. But international sympathy for Taiwan continues to grow, and the prospect of unification seems more distant than ever. As a result, Beijing will need to reconsider its approach if it wants a different outcome in cross-strait ties and to remove this issue as a potential flashpoint.

Q3: What role did Taiwan’s economy play in the election?

Relative to other economies in the region and elsewhere, Taiwan’s economy has good fundamentals and fared relatively well through the pandemic. Yet recent volatility and some chronic problems — housing costs chief among them — made the economy’s performance a central issue in the elections.

Taiwan’s economy maintained steady growth through most of the pandemic, but fell significantly in late 2022 and early 2023, with 2023 Q1 growth declining by 3.4 percent, coinciding with the end of China’s zero-Covid policy and the subsequent outbreak of cases and sudden drop in its economic activity. Taiwan’s economy picked up over the 2023, with growth of 3.4 percent in Q2 and 2.3 percent in Q3.

A key concern for voters is the cost of living. Though some blame high interest rates, the cost of housing in Taiwan’s main cities is high by international comparison. Inequality in Taiwan is still low compared to elsewhere, but it has crept up the last decade.

There is also concern about overdependence on economic ties with China. That said, there has been a relative decrease in dependence, partly as a result of Taiwan’s New Southbound Policy and partly as a result of adaptations to growing U.S.-China tensions. From 2010 to 2022, China’s share of Taiwan’s exports only dropped from 28 percent to 25 percent of the total, but China’s share of outbound foreign direct investment from Taiwan has fallen much further, slipping from 84 percent to 34 percent of the total during this period, according to PRC statistics. (Taiwan’s data, which may be less complete because it only counts projects approved by Taiwan authorities, shows a much steeper fall, with China only accounting for 11.5 percent of Taiwan’s $26.65 billion in outward foreign direct investment in 2023.)

Another broad concern is the composition of Taiwan’s economy. Taiwan’s public is proud of the island’s global leadership in semiconductor manufacturing, and Taiwan is adding to its capacity at a faster rate than anyone else. Yet there are worries that the dominance of semiconductors leaves Taiwan putting its economic eggs in one basket while crowding out opportunities for other industries, which could hurt Taiwan’s industry and workers. However, the overall situation has remained steady. Services are a growing share of the economy and was the sole source of growth in 2023. At the same time, even with China’s massive manufacturing capabilities, Taiwan has managed to maintain a large manufacturing sector itself, with manufacturing contributing over 30 percent of GDP and 24 percent of employment in 2023.

Q4: What does the outcome mean for the United States?

Despite the absence of formal diplomatic relations, Taiwan is a critical partner for the United States on a range of issues, from technology to public health to security. That Taiwan held its eighth peaceful presidential election, even amid significant pressure by Beijing, is itself an important development for the United States. Taiwan continues to stand out in Asia as a vibrant, prosperous, and stable democracy, which would not have changed regardless of which candidate received the most votes on January 13.

In the lead-up to the election, the Biden administration, through words and deeds, made it clear that the White House had no preference in terms of election outcomes. This is long-standing U.S. policy and is important for providing space for the people on Taiwan to make their own determinations about how they want to be governed. Of course, different candidates offered varying visions for how they wanted to govern Taiwan, but all three candidates sought to preserve the cross-strait status quo in their own way, which remains the overriding U.S. interest.

As President Tsai’s current vice president, Lai has signaled clearly and strongly that he seeks peace and predictability in his relationship with the United States, with China, and with the global community. While Beijing may warn of Lai’s latent secessionism, there is no evidence that a Lai administration will seek radical change. He is not version 2.0 of Chen Shui-bian, Taiwan’s first DPP president. As such, the United States will likely have an active partner in Lai on a number of fronts, with much of the important work of upgrading Taiwan’s defense capabilities that began under President Tsai continuing once Lai assumes office in May.

At the same time, Lai will face a challenging new geopolitical environment, and as a relatively untested foreign policy leader, problems will inevitably occur. First and foremost will be Beijing’s coercion campaign, which will only increase in intensity in the coming years. Building effective communication between Taipei and Washington to manage China’s likely stepped-up boundary probing, disinformation, and outright aggression will be imperative. Lai’s vice president-elect Bi-khim Hsiao has significant foreign policy experience given her recent role as Taipei’s representative in D.C. and will likely help Lai and his team navigate the challenges ahead.

Q5: What are the chief security risks going forward?

China has long expected and prepared for a potential Lai victory, readying a range of political, economic, and military options to showcase PRC displeasure and punish Lai if Beijing deems his words or actions as provocative. Although the PLA will continue to play a key role in China’s overall response to Lai, it will not be the only instrument that China uses, and — depending on what prompts China to take action — it may not be the most significant tool that Beijing leverages. At a minimum, Beijing is likely to continue to ramp up daily military and quasi-military pressure on Taiwan. This includes increased PRC air and maritime activity near and within Taiwan’s ADIZ. It also includes the use of satellite launches over Taiwan as well as balloons to further diminish Taipei’s control over the island’s airspace.

The possibility that Beijing could use significant military force against Taiwan in 2024 if the PRC views Lai as crossing a critical redline cannot be ruled out. However, if Beijing does not view Lai as deviating from Tsai, several factors are likely to dampen Beijing’s calculus to proactively use significant military force against Taiwan.

First, Beijing recognizes that Lai did not win over 50 percent of the presidential vote and the DPP did not maintain a majority in the Legislative Yuan. This provides Beijing breathing space and allows China to continue to make the argument that peaceful unification is still possible and Lai does not represent the will of the Taiwan people.

Second, China faces significant economic headwinds domestically and likely understands that any use of major military force against Taiwan could exacerbate China’s domestic situation. PRC military action against Taiwan could further weigh on foreign investment in China and cause multinational companies operating in China to reduce their activities and footprint.

Third, Beijing has actively sought to stabilize U.S.-China relations and has increased official and people-to-people dialogues and engagements with the United States. Beijing hopes the Biden Administration will help rein in Lai to some extent. A significant PRC military operation against Taiwan could undermine the recent “progress” Xi Jinping has made in U.S.-China bilateral ties and further strengthen the positions of those against China within the United States. This is particularly risky when there is a U.S. presidential election later this year and most U.S. presidential candidates have already adopted tough positions on China.

Finally, Xi is likely aware that the PLA still suffers from significant problems. The recent purging of senior PLA leaders, particularly from the PLA Rocket Force, showcases the extent to which he is focused on rooting out problems within China’s military. Questionable PLA capability will not stop Xi from using military force against Taiwan if he assesses the political situation requires it, but problems within the PLA are likely to cause Xi to think twice about using significant military force if China does not have to do so now.

Brian Hart is a fellow with the China Power Project at the Center for Strategic and International Studies (CSIS) in Washington, D.C.

Scott Kennedy is senior adviser and Trustee Chair in Chinese Business and Economics at CSIS.

Jude Blanchette holds the Freeman Chair in China Studies at CSIS.

Bonny Lin is senior fellow for Asian security and director of the China Power Project at CSIS.