Taiwan can accelerate steps to improve relations with China After KMT's Election Win

Taiwan can accelerate steps to improve relations with China after the ruling Kuomintang party did well in key local elections, an indication of voter support cooperation President Ma Ying-jeou to the mainland.

The KMT won the mayoral vote in three of the five cities on November 27 with the opposition Democratic Progressive Party to take the rest, according to the Central Electoral Commission. The five municipalities are home to about 60 percent of the 23 million people. The DPP won more votes.

"If the KMT interprets the election result as a mandate from the people on its policies, in reality it would speed up efforts to improve relations with China," said Liu Bih-rong, a political science professor at Soochow University in Taipei. "One of the strategies may focus on the pro-KMT voters and hold them, as it can not succeed in getting the DPP's vote share."

The TAIEX index rose 0.7 percent at the end of the market in Taipei. The Taiwan dollar rose 0.1 percent to NT $ 30,800 per U.S. dollar, according to Taipei Forex Inc.

Ma has faced resistance from the Office, which deals with it can put Taiwan's sovereignty is at stake as he pushes for closer economic ties with the mainland.

The KMT retained the mayor of Taipei, its traditional stronghold, and the economic and political center of Taiwan and Taichung cities and Xinbei. Ma and his predecessor, Chen Shui-bian and Lee Teng-hui, were former mayors of Taipei.

Voters went to the November 27 elections, a day after the son of former vice president of Taiwan, Lien Chan, was shot during a campaign rally in the KMT.

Trade Agreement

Lien lost the March 2004 presidential race to Chen, who was shot on the eve of the election, sparking street protests in the allegations that may have staged the shooting to win sympathy votes. Lien, then chairman of the KMT, Chen lost by 30,000 votes out of about 13 million cast.

Ma is betting that the strengthening of trade ties with China, the fastest growing economy in the world and the island's largest trading partner and investment destination, will help strengthen Taiwan's economy.

Taiwan on June 29 signed a Framework Agreement on Economic Cooperation, the first trade agreement with China to reduce tariffs and increase access to services such as banking, securities and insurance. The signing of the agreement opens the door for Taiwan to ink agreements with other countries. Singapore and Taiwan agreed on 5 August to discuss a free trade agreement.

Policy to stay

"The cross-strait policies of Ma will remain intact," said Tony Phoo, an economist based in Taipei at Standard Chartered Plc. However, "even though the KMT had won three seats, which have lagged behind in the votes. It is a warning to the government in power, they have to drive harder to build on the economic front and back confidence among undecided voters. "

The KMT won 45 percent of the total votes in the election, behind the DPP's 50 percent count, the commission said.

"The KMT will take the number of votes remaining as a precautionary measure and work harder in the future," KMT secretary general of King Pu-tsung, said on the website of the game. He attributed the number of votes than the outcome of the elections, the city of Kaohsiung, where a third candidate vying for the support of the KMT. In Kaohsiung, the DPP won 52.8 percent of the votes and the percentage of KMT 20.5, regardless Yang Chiu-hsing claims nearly 27 percent.

Cordial relations

Relations between Taiwan and China, separated by the Taiwan Strait are in the most cordial of more than 60 years after Ma declined the position of his predecessor in favor of independence and economic relations was the priority of administration.

Tsai Ing-wen, chairwoman of the DPP, opposes China trade agreement on the basis that would give Beijing more influence over the island of jobs and costs. Tsai lost the race for mayor of the city of Xinbei to Eric Chu, a former deputy prime minister in the administration of Ma Tsai in June more than 10,000 gathered to protest the agreement.

The trade agreement will help create over 260,000 jobs and boost Taiwan's economic growth by 1.65 to 1.72 percentage points each year, the administration of Ma says.

"To promote domestic employment and wages in order to reduce the wealth gap, President Ma may have to forge further economic and trade ties with Beijing," said Chang Wu-UEH, professor of political science Tamkang University in Taipei.

China and Taiwan set to hold a sixth round of talks across the Taiwan Strait next month. Since Ma took office in 2008, the government has signed 14 agreements with the mainland. China regards Taiwan as part of its territory.