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Taiwan’s Economy Transformation Term Paper

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Updated: Jan 26th, 2020


Taiwan is a small island in Asia. Taiwan location and its economy attract neighboring nations like Japan and China. According to Vickers, the original occupants of the island were aboriginal natives (2008). In the 1800s, Taiwan was a sparsely populated country. This means more farmland was available for agricultural activities. Chinese settlers who discovered the valuable resources in Taiwan migrated to Taiwan.

Some Chinese settlers worked temporarily and went home while others stayed permanently. Taiwan was a converted market for the Chinese and Japanese. This was because of the tax policies of the time. The Chinese people would bring agricultural produce to China for trade.

Political refugees fleeing from their nations found a haven in Taiwan. Taiwan was colonized by Japan in 1895 (Tun-jen, 2001). Taiwan was under the Qing dynasty when Japanese took over. The Qing administration barely had policies or structure. Under the leadership of the Japanese, Taiwan was transformed into an open economy.

The writer examines the history of Taiwan under the Qing dynasty rule. The writer also explores the economic transformation established under The ROC Nationalist Party (KMT). The reshaping of the Taiwanese identity began with reforms in the education system. Hence, the writer explores President Chen Shui-Bian and his.

Qing dynasty rule (1684-1895)

According to Vickers, there are two perspectives that characterize the Taiwan history and conquests. These perspectives are recognized as ‘Blue’ and ‘Green’ (2008). The Blue perspective relates to the period under Kuomintang (KMT) nationalism (Vickers 2008). It corresponds with the account of the Chinese Communist party. This account holds that Taiwan and China were harmoniously united.

Moreover, it assumes the primacy of the State of China. This dominance is said to be more effective as opposed to the violence used by Western imperialists. Similarly, this account credits the leadership of china for the economic development of Taiwan through absorbing and peacefully bordering people (Vickers, 2008).

The KMT attributes the success of Taiwan to Chinese superiority. Nevertheless, the blue perspective fails to recognize the historical progression of Taiwan before the seventeen century or its relation to China. Vickers claims that the blue approach does not give evidence to corroborate the primacy of China (2008). The association is ascribed rather than established, and merely a few roles are mentioned.

These include the role played by China in ejecting the Dutch, the war between Japan and China over Taiwan and the invasion of the Island by KMT forces in 1945. The blue line portrays Taiwan’s citizens as Chinese nationalists who celebrated the liberation from Japanese rule, and who desired to be united with China.

On the other hand, the green perspective describes the period following their independence in 1945. Vickers claims that this perspective is widely endorsed (2008). It received the patronage of President Chen Shui-bian (Vickers, 2008). This perspective seeks to diminish the importance of China as a frontier in Taiwan’s past. It contradicts the superiority of China promoted by blue perspective.

According to a historical course on Taiwan, the Qing and Kuomintang government represent two periods amongst many when other powers controlled Taiwan (Vickers, 2008). A green perspective account, before the seventeen century, Taiwan was dominated by aboriginal natives. The ‘Polynesian’ traditions of the aboriginal indicate they came from other frontiers and not china.

The first Chinese settlers came to Taiwan when it was governed by the Dutch. Essentially, the green perspective traces Taiwan’s history back to the Qing rule when the nation was sovereign.

It was under the Qing administration that Japanese colonized Taiwan. Both the KMT and Qing handed over Taiwan to colonialists. Vickers (2008) illustrate the lesson learnt from this perspective was Taiwan did not trust other nations, but themselves to build their nation.

Taiwan under the Democratic progressive party (DPP) (2000-2008

The Taiwan government, under President Chen Shui-Bian, was a self-conscious nation. This was influenced to China’s key economic and geopolitical player in the region (Lynch, 2004). According to Lynch in his article “Taiwan’s Self –Conscious Nation- Building project”, Taiwanese nationalists fear the economy of their country is in danger of being absorbed by China (2004).

Despite the growth of Taiwan’s economy, nationalists feel that Taiwan will be overwhelmed by China’s accomplishments (Lynch, 2004). Nationalists like Lee Chiao accuse china of too much pride (Lynch, 2004). He believes Taiwan needs a cultural transformation and disregards the notion that Taiwanese and Chinese cultures are similar (Lynch, 2004).

Taiwanese are confident that transforming the country into an independent state will prevent it from being absorbed. Lynch (2004) claims process is not so easy. Taiwan has all the elements it requires like a territory, strong administration and citizens. What the country requires to make it bona fide state is a united front and “national consciousness” (Lynch, 2004).

The concern of reshaping the identity of Taiwanese youth began with a sequence of educational reforms. These reforms were implemented during the Lee Teng-hui’s term. During 1995 to 1997, the government established a committee, chaired by Nobel Laureate and Academia Sinica President Lee Yuan-tse.

The committee approved a social studies curriculum that came to be known as “Knowing Taiwan” and a new high school library after a lengthy discussion and research. The committee was established with a view of reshaping the Taiwanese educational content by abolishing the KMT’s Sinocentric Greater Han bigotry and replacing with a Taiwan centered curriculum (Lynch, 2004).

Also, the committee held extensive deliberations including the Japanese colonial period, which lasted between 1895 -1945. Besides, the discussion gave the Malayo-Polynesian aboriginals a loftier place in Taiwanese history.

The major goal of these discussions was to help teach the young Taiwanese to identify themselves with Taiwan, have a concern with their country and increase youth awareness in world affairs. Perhaps, these teachings, presently, have produced ethnic pluralism in Taiwan creating a Taiwanese consciousness.

According to Lynch (2004) Taiwanese had a clear understanding of their identity as early as 1920’s. They had learned the western concepts of citizenship and nationality through a Japanese filter, as their colonial master. This prompted them to quest for building a Taiwanese nation.

Professionals such as the doctors, engineers, and intellectuals worked hard to develop Taiwanese identity. This was achieved through rallying slogans such as “Taiwan belongs to Taiwanese”. They also staged plays, held public lectures and published newspapers.

Lynch (2004) notes after the 1930s, many Taiwanese began identifying themselves with China, but it is worth mentioning how alacritous the Taiwanese society took to the Japanization (huangminhua) movement that began in 1937 (Lynch, 2004). During the war years, Lynch (2004) alleges Taiwan “lost itself”.

This was because it was acquiescing to Japanese demands and had started becoming a target for military base operations in Southeast Asia and the Pacific. In fact, Taiwan had only begun to “find itself” in 1920s and never had the opportunity to integrate these early gains or develop a genuine Taiwanese subjectivity.

Taiwanese base their second transfer of political power on the book “Imagined Communities”. They argued, basing on this contemporary classic that ‘no nation is essential, and all are constructed through processes of collective imagining” (Lynch, 2004).

This conception of nation building has given the politically engaged Taiwanese, intellectuals and activists a strong self-confidence in their ability to transform Taiwan into a bona fide nation state. They believe “if nations are constructed, then they can construct one, too”.

They consider Taiwan is an established territory, with a government and people. Similarly, the challenge posed by the Taiwanese people is constructing a solid collective identity. According to Lynch (2004) Taiwanese believe forming a collective identity is not a significant challenge.

This is because, over a century ago, Taiwan was an under populated outpost of pre-nationalistic Qing China, thus; it was deeply divided along ethnic lines, clannish feuding and culture. However, in recent times, Taiwanese nation builders seem to have confidence (Lynch, 2004).

They argue Taiwan has generated the highest economic growth rate in the world during the 20th century. Besides, democratization it has successfully repelled constant pressures from china to accept similar fate as those experienced in Hong Kong and Macau.

The ROC Nationalist Party (KMT) on Taiwan (1949-1971)

Tun-jen asserts that Taiwan had grown economically under the Japanese rule until now (2001). The economic structure of Taiwan in the pre-colonial period was subsistence- based. The administration of the Qing dynasty had poor economic policies that hindered the growth of Taiwan (Tun-jen, 2001). When Japan colonized Taiwan, various projects and programs were introduced for economic growth.

The Japanese adopted an agrarian based culture and open economy. The first project was an overhaul of the transportation system. The Japanese government needed proper infrastructure in place in order to open market and sustains order (Tun-jen, 2001). In addition, the Japanese carried out cadastral survey that enabled them to explicate property rights and boost revenue from taxes.

The second project involved the introduction of census and new economic enterprises. Census was carried out in order to examine the supply of labor and develop pre-existing population monitoring structures.

In the 1900s financial institutions, such banks were established to promote trade. These key institutions grew rapidly and multiplied throughout the country (Tun-jen, 2001). Tun-jen notes that the growth of financial institutions promoted the expansion of saving mobilization and commercial activities (2008). The agricultural sector improved due to the establishment of different associations and extension services.

Such services promoted the introduction of new arrays of seeds for farming. The new varieties increased agricultural production. Although these activities were carefully devised to promote the agrarian economy, the Japanese administration did not take time to market their goods and services. Instead, the management of these enterprises was entrusted to Japanese capitalists.

This action turned over the Taiwan resources to Japanese individuals. Taiwan became a production base for Japanese goods and a market for their industrial products. Tun-jen (2001) asserts in less than ten years after the Japanese conquest, rice and sugar became the principal export goods in Taiwan.

The difference between Taiwan and other Asian countries that were colonized like South Korea is that Taiwan was not divided by civil wars or colonial rulers. Moreover, Taiwan was ruled by foreigners for a long time. This period enabled the country to be economically stable. Tin 1947,

the Japanese government, relinquished all its power to Kuomintang after the KMT uprising (Tun-jen, 2001). Their only responsibility was to restore the country and not create institutions thanks to the Japanese rule.


The historical heritage, political background and economic development of Taiwan make it one of the powerful nations in East Asian. It has significantly contributed to the world’s economy. Its success can be credited to Japan which, colonized Taiwan and introduced agrarian system. During this period, China was constantly at war with Japan over Taiwan. Nevertheless, the Chinese army failed to seize the land.

Currently, the country is in danger of being absorbed by china. In the past, china tried to colonize Taiwan, but their efforts were unsuccessful. The blue perspective endorses the superiority of china and associates China with Taiwan (Vickers, 2008). However, Taiwanese nationalists disregard this knowledge. They desire to have a state which is independent of Chinese influence.

Reference List

Lynch, D. (2004). Taiwan’s Self –Conscious Nation- Building project. Asian Survey, 44(4), 513-533.

Tun-jen, C. (2001).Transforming Taiwan’s Economic Structure in the 20th Century. The China Quarterly, 165, 19-36.

Vickers, E. (2008). Original Sin on the Island Paradise? Qing Taiwan’s colonial history in comparative perspective. Taiwan in Comparative Perspective, 2, 65-86.

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