MARCH 27, 2000 VOL. 155 NO. 12

Chen's Triumph
In a dramatic election, voters sweep out the Kuomintang and choose a leader who talks openly of separatism. How will Beijing react?
By TERRY MCCARTHY Taipei


The future won over the past and hope overcame fear in Taiwan as voters chose opposition candidate Chen Shui-bian last Saturday to be their next President. Chen, 49, overturned 55 years of Kuomintang (KMT) rule on the island while defying angry rhetoric from Beijing that threatened war if he was elected. After the results were announced, the streets of Taipei exploded into a noisy sea of firecrackers, klaxons and his party's green flags, as the enormity of Chen's victory began to sink in. Only 14 years ago Chen was languishing in jail for libeling a high-ranking KMT member; now he has won the highest office in the land. "This is the greatest victory of Taiwan's democracy movement," Chen told Time. "This moment is truly historic."

David Hartung for TIME The Chen family celebrates on election night

The race was tight, with Chen winning 39% of the vote. His closest rival, James Soong, took nearly 37%, while the KMT candidate Lien

Chan limped in with just a 23% showing. Tallied by computer, the results were known less than four hours after the polls closed, unleashing a torrent of emotions among Chen supporters. "I am overwhelmed by the victory," said Hsiao Li-hsin, a 30-year-old legislative assistant standing with his girlfriend in the crowd outside Chen's party headquarters. "I'm going to stay here all night and all tomorrow morning." Police closed the streets to traffic for several blocks around the impromptu victory party. Kids on skateboards waving Chen banners wove in and out of the crowd, while street vendors set up food stalls. "I'm going to sleep well for the first time in 50 years," said Shih Shia-shu, 70, a pensioner wearing a Chen hat.

But as Chen's supporters frolicked, others began to worry about where the newly elected President would lead Taiwan. Mainland China, which has long threatened invasion if Taiwan declared independence, recently upped the ante in an official White Paper that vowed to use force if Taipei continued to delay holding serious negotiations about reunification. Beijing regarded Chen as the least receptive of the candidates to its "one-China" policy. In fact, many friends of Taiwan in Asia and the United States had hoped that someone else--anyone else--would win the election, so that tensions across the Taiwan Strait would calm down and business would go back to normal. But on Saturday Taiwanese decided they did not want to go back to anything. Instead they voted to change the political system of patronage and corruption--known locally as "black gold"--that has monopolized power on the island for more than half a century. And if the heavies in Beijing didn't like that, well, they were in Beijing, and probably shouldn't have interfered in Taiwan's elections in the first place.

ALSO IN TIME COVER: A Democratic Milestone In a dramatic transition of power away from KMT rule, Chen Shui-bian wins election to the island's highest office. The big question now: Will Beijing take his victory in stride? • Biography: The new President has a winning smile and the determination of a tiger • Chen Interview: "This moment is truly historical" • Viewpoint: Antonio Chiang assesses Lee Teng-hui • Line of Fire: Sin-ming Shaw on Taiwan's Chineseness INDIA: Home Away from Home Bill Clinton is traveling to South Asia at a time when its diaspora is rising to the top of the American melting pot, making hit movies in Hollywood and Internet millions in Silicon Valley--and smashing stereotypes along the way • Viewpoint: Indian-Americans reach for their roots • Meanwhile: Faces of the New India CINEMA: A gender-bending Thai film is a smash hit TRAVEL WATCH: Hong Kong's Palate Pleasers

In fact, China's anti-Chen scare tactics may have backfired. "We are used to China's threats now--they always come up with something, and we have been letting the KMT play their game for too long," said David Lu, 26, a research assistant at a Taipei school of fine arts, after voting for Chen. "Stability is important, and I do have money in the stock market, but in the end I think Chen can best carry us forward." Said Lee Fan-mei, 35, a secretary: "I am not afraid of China. We need to assert ourselves as Taiwan and as the Taiwanese people."

Much will depend on precisely how Chen decides to assert himself in the relationship with China. Despite belligerent words from Beijing during the campaign, some analysts think China will not escalate tensions until Chen has shown his true colors on cross-Strait ties. He did not campaign aggressively against China--on the contrary, he suggested an increase in commercial contacts. And he says he is prepared to make a goodwill visit to the People's Republic before his inauguration on May 20. "Chen is well aware that as President-elect every word he utters will be examined by the prc--and the U.S.--under a magnifying glass," says Bi-khim Hsiao, director of international affairs for Chen's Democratic Progressive Party. The DPP has historically espoused independence, but although the party charter still has a clause asserting Taiwan's right to self-determination, Chen has taken pains to distance himself from the independence issue. In an interview Saturday, Chen said he would immediately set up a cross-party advisory group to deal with "the very difficult issue of cross-Strait relations," adding that "passions must subside."

Even if Chen makes the right noises, it is unclear how China will respond. Taiwan's relations with the mainland have essentially been frozen since Lee Teng-hui--derided as a "splittist" in Beijing--won the 1996 presidential election. "The Chinese leadership now must face an important decision," says Bruce Jacobs, director of East Asian studies at Monash University in Perth, Australia. "If they decide that Chen Shui-bian is really a Taiwan independence supporter no matter what he says, and they refuse to talk to him, there will be four more years of no progress. But if they draw a deep breath and say, 'Let's try to get to know one another better,' it could lead to reduced tensions. China would have a lot to gain from that in terms of investment and trade from Taiwan."

Others see more dangerous times ahead. "The view may prevail [in Beijing] that Taiwanese politics has passed the point of no return, leaving no hope for peaceful resolution--and making eventual military confrontation inevitable," says Chu Yun-han, a political scientist at National Taiwan University. Certainly suspicions about Chen's instincts are running high in Beijing. "Chen's DPP background will constrain him from forming a rational mainland policy because he won't be able to adopt a policy independent from his party's," says Yan Xuetong, researcher at Beijing's China Institute of Contemporary International Relations. "Therefore, his rule will inevitably worsen cross-Strait relations." In its first public reaction to the election results, Beijing reiterated its one-China formulation. The official Xinhua news agency quoted the Taiwan Affairs Office of the State Council as saying: "Taiwan's local leadership election and its results cannot change the fact that Taiwan is a part of China's territory."

China will not be Chen's only problem. Domestic politics also requires a delicate balancing act from the new President-elect, who won with less than 40% of the vote. The DPP has only 70 lawmakers in the 225-seat Legislative Yuan, and Chen will have to reach outside his party to build a functioning government. As Taipei mayor in the mid-'90s, he was successful in making appointments across the political spectrum, and he has said that as President he would be committed to forming a government that transcends ethnic and party lines. But coalition-building will be more complicated at the national level, particularly as the KMT is widely expected to split after its loss at the polls.

Indeed, the resounding defeat of Lien Chan, the KMT candidate, was almost as momentous as Chen's victory. Despite the backing of outgoing President Lee and the formidable KMT party machinery, Lien's bid fell apart in the closing days of the campaign. Voters found his patrician manner wooden and alienating and were unconvinced by his promises of reforming the party. The real challenger to Chen turned out to be James Soong, a former KMT stalwart who was forced out of the party and ran as an independent. Conceding defeat, Lien told his downcast supporters on Saturday night: "I admit we failed this time. I realize the party has its shortcomings and we need to reform to survive."

But the party may not be able to survive in its current form. Lo Chih-cheng, professor of political science at Taipei's Soochow University, predicts a "dealignment and then realignment" of the KMT with some pro-Soong forces who might leave him to create a new party or try to retake control of the KMT. "The KMT as we have known it will not continue to exist."

Chen's victory and Lien's humiliation were starker than expected. For months opinion polls had the candidates running neck and neck. In the final days of the campaign, the competition for votes became cutthroat. Chen's campaign planners knew they had to neutralize his image as a man with dangerous pro-independence leanings. They scored their biggest coup March 10, eight days before the polling, when Chen won the endorsement of Lee Yuan-tseh. A winner of the 1986 Nobel Prize for Chemistry and president of Taiwan's top research institute, the Academia Sinica, Lee has been called "the conscience of Taiwan" in the local media and had been actively courted by all three main candidates. Lee brought the necessary balance to Chen's campaign, reassuring voters who were nervous about the candidate's views on cross-Strait ties by promising to negotiate with Beijing. "I think [China] would accept me as a peace envoy," says Lee, who is well-known on the mainland and has been awarded an honorary doctorate by the Chinese Academy of Sciences in Beijing.

Cross-Strait tension won't easily dissipate, however. Before the election, Beijing turned up the rhetoric, with pla generals threatening war if Chen was elected. On March 13, immediately after those threats, the Taipei stock market plunged 617 points, a 6.6% decline--the biggest fall since Beijing lobbed missiles over the Strait in an attempt to disrupt the 1996 election. The market's drop gave the KMT a bit more pre-election ammunition. Lien pointed to the movement as proof that a Chen victory would be a disaster for Taiwan. But Chen hit back, claiming the market plunge had been orchestrated by the KMT to spook voters into voting for Lien. "They tried the threat-of-war theme, and that didn't work," said Chen. "Now they're trying the financial-collapse theme, and that won't work either."

The market continued to tank during most of last week, until a government stabilization fund was mobilized to buy up stocks and stop the panic selling. By then another bombshell had been dropped, this time from an unexpected source. Zhu Rongji, China's reform-minded Premier and normally a moderate voice on the subject of Taiwan, launched an angry attack on Chen. In a midweek press conference to wind up the annual session of China's parliament, Zhu warned the electorate in Taiwan against "impulse" voting. "Otherwise I'm afraid you won't get another opportunity to regret." He said Chinese were prepared to "shed blood" to protect their territory, and dismissed Western military analysts who say China is still years away from being able to invade Taiwan successfully.

Warning lights began flashing red across Asia and as far away as Washington. If Zhu the moderate was talking war, what were the hawks in the military planning? U.S. Defense Secretary William Cohen, on a tour of Asian nations, said Beijing's "threat of the use of force is counterproductive." Later in Washington, the State Department summoned China's ambassador, Li Zhaoxing, to formally protest China's threats and call for Beijing to turn down its rhetoric.

Chen's aides admitted they were upset by Zhu's words. But Hsiao, the DPP international affairs director, said the party had already taken its "immunization shots" by running TV ads playing on the stability theme. "We had one of Chen with his childhood friends saying that only if Taiwan is secure would all his friends be secure," says Hsiao. "Another showed his son who is going into the military--the message was Chen obviously doesn't want his own son to go to war."

Meanwhile the other two prominent candidates tried to exploit war fears to the full. Soong, seen as the closest of the three to Beijing, claimed he was in the best position to start "a constructive dialogue" with China. Lien reached deep into his bag of tricks and launched a TV ad scare-campaign showing submarines with the eerie sound of sonar overlaid with Chinese nuclear threat warnings. By Friday night, when all three candidates held their final rallies, Taiwan's people were torn between Chen's promises of real change, Lien's offer of stability and Soong's claims that he could reform the system from within without antagonizing China. Chen's promise of change won. Taiwan will never be the same.

With reporting by Jaime A. FlorCruz/Beijing, Macabe Keliher and Don Shapiro/Taipei and Barry Hillenbrand and Douglas Waller/Washington

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