The Political Economy of Regime Transformation: Taiwan and Southeast Asia

By Ku, Samuel C. Y. | World Affairs, Fall 2002 | Go to article overview

The Political Economy of Regime Transformation: Taiwan and Southeast Asia


Ku, Samuel C. Y., World Affairs


With rapid economic growth since the early 1970s and successful political democratization in the 1990s, Taiwan has presented itself as a very unique case of regime transformation in the Third World. (1) Economically, Taiwan's growth rate averaged 7 to 8 percent in the 1970s, 1980s, and 1990s. The gap between the rich and the poor, or the income disparity ratio, dropped from 15:1 in 1952 to 4.69:1 in 1987, although it rose a little to 5.5:1 in the mid-1990s. (2) Taiwan's GNP per capita increased from roughly U.S.$50 in 1950 to U.S.$13,325 in 2000. The island's unemployment rate has been kept low, at an average of 2 percent in the last five decades, despite its recent rise to almost 5 percent in mid-2001. Taiwan did not have significant foreign reserves prior to 1960, but because of rapid growth in exports, Taiwan's foreign reserves increased from less than U.S.$1 billion in 1973, to U.S.$73 billion in 1989, to almost U.S.$100 billion in the mid-1990s. (3) With those shining macroeconomic figures, Taiwan's description as an economic miracle is "hardly an over- statement." (4)

Under the rule of martial law from 1947 to 1987, Taiwan's political transition is another unique case in the Third World. Taiwan was given back to the government of the Republic of China (ROC) at the end of World War II in August 1945, and since then Taiwan has been under the ROC's administration. Defeated by the Chinese Communists, President Chiang Kai-shek led the ROC government to move its seat to Taiwan in December 1949. After that the military, under Chiang's paramount leadership, was a dominant force in Taiwan's politics until his death in April 1975. Despite the martial-law regime, people in Taiwan began to practice direct elections at the local level in the early 1950s, creating a foundation for Taiwan's later democratization. Taiwanese political participation was expanded to the national level in December 1969, when eleven legislators to the Legislative Yuan and fifteen delegates to the National Assembly were directly elected by the people in the Taiwan area.

In July 1987, President Chiang Ching-kuo, son of Chiang Kai-shek, lifted martial law, initiating Taiwan's political liberalization and democratization. Afterward, the prohibition on forming political parties and the ban on the freedoms of speech, publication, association, and assembly were also relaxed. In January 1988, Taiwan experienced a successful political transition when Lee Teng-hui, a native Taiwanese, succeeded Chiang Ching-kuo as the president of the ROC. (5) The Taiwanese experienced political participation at the national level when they participated in electing all members of the National Assembly and Legislative Yuan in December 1991 and again in December 1992. In May 1996, based on the newly revised constitution, Lee Teng-hui became the first directly elected president of the ROC. In May 2000, Lee handed his presidency over to Chen Shui-bien, the first nonKuomintang (KMT) member to become the ROC's president. With those smooth political changes, Taiwan has without a doubt achieved the transformation from an authoritarian regime to a consolidated democracy. (6)

Southeast Asian countries shared some political and economic similarities with Taiwan in the 1950s, but the level of Taiwan's development in the 1990s has gone far beyond that of most countries in Southeast Asia. What are the differences between Taiwan's regime transformation and those of other Southeast Asian countries, the island's neighbors? As they enter the new century, can Southeast Asian countries learn some lessons from Taiwan and make progress similar to Taiwan's during the last five decades? These are the major questions I will explore in this article. I argue that Burma, Thailand, Laos, Cambodia, Vietnam, Malaysia, Indonesia, Brunei, the Philippines, and Singapore differ from Taiwan in the process of the transformation of their political regimes. Burdened with sustained internal difficulties and problems, most Southeast Asian countries have little opportunity to reach the level of Taiwan's current political and economic development, at least not in the near future. …

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