1 Taiwan’s William Lai subtly calls PRC’s legitimacy into question ahead of ROC National Day
Taiwan leader says ‘impossible’ for PRC to be Taiwan’s motherland
Oct. 5
Speaking at an event ahead of the Republic of China’s national day celebrations on Oct. 10, Taiwan president William Lai Ching-te said, “The People’s Republic of China just celebrated its 75th anniversary on Oct. 1, and in a few days the Republic of China will celebrate its 113th birthday. Therefore, in terms of age, it is absolutely impossible for the People’s Republic of China to become the ‘motherland’ of the Republic of China’s people. On the contrary, the Republic of China may be the motherland of the people of the People’s Republic of China who are over 75 years old.”
Lai added, “If anyone wants to wish the People’s Republic of China a happy birthday, they must be precise in their congratulatory message and avoid using the word ‘motherland.’” He continued, “One of the most important meanings of these celebrations is that we must remember that we are a sovereign and independent country.”
Lai’s “motherland” remark sparked heated discussion among Chinese netizens. The CCP authorities subsequently scrubbed such discussions.
Oct. 7
Reuters reported that the PRC is likely to launch military drills near Taiwan after William Lai delivers his national day speech on Oct. 10, citing Taiwanese officials.
A senior Taiwan security official citing intelligence collected by Taiwan and the government’s assessment on the PRC’s likely moves said, “Our assessment is that no matter what Lai says on October 10, they might put a name on existing exercises and call it Joint Sword – 2024B. That’s a possibility.”
The Taiwan authorities said in an internal security memo that they believe Beijing might cite William Lai’s “provocation” in his speech as reason for possible drills. The memo said that the PRC has “continuously tried to test the red lines of various countries, maximizing its gray-zone operations.”
Reuters cited a Taipei-based diplomatic source as saying that the upcoming U.S. presidential election and Beijing not wanting Taiwan tensions to suddenly come under the international spotlight so close to the vote could be a factor holding back the PRC’s military reaction to Lai’s speech.
Oct. 8
In response to a journalist, Zhu Fenglian, the spokeswoman for the PRC State Council Taiwan Affairs Office, criticized William Lai’s “motherland” remark as a “conceptual sleight of hand” and “confusing right and wrong.” Zhu added that Lai’s remark was a rehashed version of the “Taiwan independence” rhetoric.
Zhu further accused Lai of emphasizing the political differences between the two sides of the Taiwan Strait, deliberately severing the historical ties between the two sides, continuing to push a “new two-state theory” which claims that the ROC and the PRC are “not subordinate to each other,” and escalating hostile confrontation.
Lai rejects PRC’s ‘territorial integrity’ argument
Sept. 1
In an interview with Taiwanese media, William Lai said, “China’s desire to annex Taiwan is not actually an issue of territorial integrity, but an attempt to change the rules-based international order. The PRC’s true goal is achieving international or western Pacific hegemony.”
Lai brought up the Treaty of Aigun signed between the Qing imperial government and Tsarist Russia in 1858 that saw China ceding a vast tract of land in what is now Russia’s far east and pushing the Sino-Russian border to the Heilongjiang River.
“China’s intention to attack and annex Taiwan is not because of what any one person or political party in Taiwan says or does. It is not for the sake of territorial integrity that China wants to annex Taiwan,” Lai said. “If it is for the sake of territorial integrity, why doesn’t it take back the lands occupied by Russia that were signed over in the Treaty of Aigun? Russia is now at its weakest right?”
Backdrop
Tsai Ing-wen visits Europe
On Oct. 7, the office of the president of Taiwan confirmed that former president Tsai Ing-wen would be visiting the Czech Republic and other European countries starting on Oct. 12 to further deepen relations between Taiwan and European nations. Taiwan presidential office spokesperson Karen Kuo said William Lai fully supports Tsai’s trip and will provide necessary and comprehensive assistance, particularly regarding safety and other logistical concerns.
Reuters reported that Tsai will deliver a speech at a Forum 2000 conference in Prague that will be held from Oct. 13 to Oct. 15, citing three sources briefed on the matter. The sources said that Tsai is set to meet senior Czech and other European politicians while in the Czech Republic. One of the sources said, “Taiwan’s ties with the Czech Republic and Europe are getting closer and closer in recent years, especially in global geopolitics.”
Reuters also reported two diplomatic sources saying that Tsai is planning to visit France and Belgium while in Europe. Tsai’s office said there was no confirmation yet for other parts of her Europe trip.
Taiwanese media reported that Tsai Ing-wen would be in Europe for eight days. Tsai’s itinerary is confidential because she will not be visiting countries with official diplomatic relations with Taiwan, and she is expected to receive “high-level treatment” during her visit.
Washington delays congratulatory message on the PRC’s national day
On Oct. 2, the U.S. Department of State issued a statement congratulating the “people of the People’s Republic of China” on the PRC’s 75th national day and wishing them “peace, prosperity, and happiness in the year ahead.”
The State Department’s national day congratulations in 2024 departed from its previous practice of sending the statement before the PRC’s national day. The State Department sent congratulations on Sept. 29 in 2023 and on Sept. 30 in 2022.
On Oct. 5, the PRC foreign affairs ministry published a statement on its website noting that President Joe Biden had “recently” called Xi Jinping to extend congratulations on the PRC’s national day on behalf of the American people to Xi and the Chinese people.
Our take
1. Taiwan leader William Lai’s “motherland” and “territorial integrity” remarks spotlight the CCP’s seizure of power in mainland China and its history of territorial concessions. Both topics call into question the CCP’s leadership over China and have historically been sore spots for the Party.
i) The CCP was originally founded as a Soviet front organization that was meant to advance the interests of the Soviet Union (Russia), rather than those of China. The Party’s manifesto from its Second National Congress in July 1922 described itself as a branch of the Communist International (Comintern) and recognized the Soviet Union as the “motherland of the proletariat.” After the Japanese invasion of Manchuria on Sept. 18, 1931, the CCP issued a declaration three days later calling for the overthrow of the Kuomintang government and the armed defense of the Soviet Union. Then in November that year, the CCP established the Chinese Soviet Republic in Ruijin City, Jiangxi Province, which effectively divided the Republic of China. While the CCP did play on patriotic sentiments before and after seizing power, it always sought to paper over its origins as a Soviet front and sedition against the ROC government when the latter was the legitimate ruler of mainland China.
Unlike the CCP, the ROC government has a direct claim to legitimacy via the abdication edict of the last emperor of China. The “Xuantong Emperor’s Abdication Edict” established the ROC as the sole successor state to the Qing Dynasty and granted the ROC government the legal basis to inherit all the Qing territories. Sun Yat-sen and many of the revolutionaries at the time of the ROC’s founding were also Chinese nationalists and not representatives of other countries or regimes.
The ROC government did not abandon its claim as the sole legitimate government of China even after Chiang Kai-shek’s KMT forces retreated to Taiwan during the Chinese Civil War. The creation of the “Two Chinas” today was the result of Cold War machinations as President Richard Nixon sought engagement with the PRC to counter the Soviet Union. In 1971, the 26th United Nations General Assembly replaced the ROC with the PRC as China’s representative to the United Nations via Resolution 2758; the ROC did not agree to this resolution, nor did it give up its sovereign claims.
Following Russia’s invasion of Ukraine in 2022 and with countries souring on their relations with the PRC, the international community has started to argue that Resolution 2758 did not establish the PRC’s sovereignty over Taiwan or involve Taiwan, and that the CCP has been distorting the resolution in an attempt to undermine Taiwan’s international status and participation in international affairs.
William Lai’s “motherland” remark thus indirectly calls attention to the PRC’s questionable legitimacy in ruling China, as well as the ROC government’s enduring claim to sovereignty over both Taiwan and the mainland.
ii) The CCP did not properly respond to William Lai’s “territorial integrity” remark beyond issuing boilerplate propaganda because it likely fears drawing further attention to observations that it is guilty of giving away China’s territory to Russia. When Jiang Zemin was in office, he was responsible for settling 98 percent of disputed border issues between China and Russia in the 1990s following the dissolution of the Soviet Union. Chinese commentators, scholars, and experts have long held that Jiang secretly consigned millions of square kilometers of disputed territory to Russia as part of the border resolutions.
iii) We believe that William Lai’s “territorial integrity” and “motherland” remarks are factually sound statements that spotlight the CCP’s less than glorious history. Lai’s remarks are highly effective as propaganda and psychological warfare as the CCP cannot publicly “debunk” them in detail without going over the facts and risk eroding their credibility and political legitimacy.
Instead, the CCP will have to resort to its usual labels in attacking Lai, including accusing him of being for “Taiwan independence,” a “two-state theory,” or even “colluding with the U.S. for independence.” Beijing also has to step up censorship to prevent Chinese netizens from discussing particularly sensitive topics. Finally, the CCP will likely launch military drills to intimidate Taiwan and could possibly impose some sanctions and product boycotts.
2. The Biden administration’s delayed congratulatory message to the PRC on its national day reflects the heightened state of Sino-U.S. tensions in recent years. The delay aside, the State Department’s congratulatory message this year was stark in tone, calling for “responsibly managing” the bilateral relationship and maintaining “open lines of communication,” but without mention of cooperation. In contrast, the messages in 2022 and 2023 were more conciliatory, noting that the U.S. “welcome(s) the cooperation of the PRC” in a range of issues. Several factors account for worsening Sino-U.S. tensions, including Beijing’s unwillingness to denounce and cease supporting Moscow in the Russia-Ukraine conflict, growing awareness about the CCP threat and hegemonic ambitions, China’s rapidly deteriorating economy and poor prospects, and political pressures in the leadup to the 2024 U.S. presidential election.
Meanwhile, the PRC foreign ministry’s claim that President Joe Biden had sent a congratulatory message to Xi appears to be an effort to redirect attention away from the State Department’s delayed congratulations. If so, this suggests that Beijing is quite concerned with Washington’s hardening attitude towards the PRC and is trying to manage the messaging.
The PRC foreign ministry did not say when exactly Biden called Xi Jinping to send congratulations. This lack of detail is glaring and suggests that Biden could have only made the call a few days after the PRC national day, which again brings up the delay problem and the question of why Washington is disrespecting Beijing. We believe that the foreign ministry would have reported the Biden-Xi call earlier if it took place before or on Oct. 1.
3. Former Taiwan president Tsai Ing-wen’s visit to Europe is a further development of the international community’s effort to afford greater recognition of Taiwan’s diplomatic status and sovereignty in the wake of growing awareness about the CCP threat. Since Russia’s invasion of Ukraine, the U.S. and Europe have been steadily strengthening ties with Taiwan, including promoting Taiwan’s participation in international organizations and enhancing Taiwan’s self-defense capabilities. As Tsai is a former leader, her interactions with officials in Europe would be of the semi-official nature. This would make it more palatable for European countries to host her without provoking a strong reaction from the CCP and risking Sino-European economic relations.
Aside from supporting Taiwan diplomatically, European countries likely want to have better relations with the island to court valuable business. In particular, European nations could be eyeing collaboration with TSMC to establish more chip plants, which would boost European semiconductor supply and self-sufficiency, as well as provide a contingency in the event that the PRC decides to invade Taiwan.
2 Analyzing recent claims that Xi’s grip on power is weakening
Recently, overseas Chinese observers have been calling attention to signs that they believe indicate that Xi Jinping’s grip on power is unstable.
Xi compromising with Party elders?
Sept. 26
During a meeting of the CCP Politburo, Xi Jinping said that “some new situations and problems have emerged in the current economic operation.” Beijing also announced a series of economic support measures to boost the capital market and real estate sector.
Some Chinese observers believe that Xi’s view of the economy has shifted significantly compared to previous statements from the central government, in particular the assertion that the Chinese economy “cannot take strong medicine” (i.e. strong stimulus). They also believe that the Xi leadership’s economic support measures are akin to the Hu-Wen government’s 4 trillion yuan stimulus in 2008. The observers therefore believe that Xi had compromised in the face of pressure from within the Party.
Sept. 30
Former senior Party officials Li Ruihuan and Wen Jiabao were seated on either side of Xi Jinping at the reception dinner for the 75th anniversary of the founding of the PRC. This was a departure from previous receptions, where current members of the Politburo Standing Committee were seated beside Xi.
The appearance of Li and Wen at the 2024 reception also contrasted with the 2018 national day reception where there was a collective absence of former senior Party officials like Jiang Zemin, Li Peng, Zhu Rongji, Hu Jintao, and Wen Jiabao from the proceedings. In 2018, Xi abolished term limits for the PRC presidency.
Some Chinese observers believe that the appearance of Wen Jiabao and Li Ruihuan at this year’s national day reception was a sign that Xi was facing political trouble.
Xi loyalists sidelined?
Some Chinese observers believe that Xi Jinping has been moving against military loyalists that he promoted up the ranks owing to backlash from political enemies. The observers point to developments and rumors including:
Sept. 28
The National University of Defense Technology posted on its official WeChat account that Lieutenant General Chen Guoqiang, a member of the Central Commission for Discipline Inspection and deputy Party secretary of the discipline inspection commission of the Central Military Commission, was transferred to the university to serve as political commissar (deputy theater command grade).
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Chen Guoqiang, 61, is a People’s Liberation Army Air Force lieutenant general who spent the bulk of his career in political work.
Oct. 6
Chinese-Australian scholar Li Jun posted on X that Admiral Qin Shengxiang, the former director of the CMC General Office, had allegedly been taken away for investigation that day.
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Qin Shengxiang, 67, is a PLA Navy admiral who served as CMC General Office director from October 2012 to November 2015 and PLA Navy political commissar from August 2017 to January 2022.
Related political rumors from earlier
1. In April 2024, a pro-Beijing media outlet in Hong Kong reported that Lieutenant General Zhong Shaojun, the director of the CMC General Office, had been appointed as political commissar of the PLA National Defense University as of April 3. Zhong was replaced at the CMC General Office by Fang Yongxiang, the deputy political commissar of the Southern Theater Command and political commissar of the PLA Ground Force.
2. In early September 2024, overseas Chinese social media reported that General Qin Shutong, the PLA Ground Force political commissar, was investigated.
Our take
1. We would not be surprised if the Xi leadership eventually rolls out stronger stimulus and other policies that appear to drastically depart from its previous approach to the economy. However, Xi Jinping changing policy direction would have less to do with political pressure and compromise from remnant political enemies with reduced influence, and is more likely being driven by his own priorities and broader ambitions. The Xi leadership places greater emphasis on security in balancing security and development in weighing the CCP regime’s geopolitical challenges and domestic requirements. To pursue the regime’s security needs, the Xi leadership needs steady economic growth and financial stability to provide vital undergirding. Therefore, Beijing would have to consider introducing stronger stimulus at some point if it wants to power economic growth, tide over local debt and fiscal problems, keep China attractive to foreign investors, prop up the capital market, and prevent the blowing up of financial risks.
Many Chinese observers do not like Xi Jinping and narrowly view him as a sort of Maoist with ideologically rigid views on economic development. As such, they would naturally suspect that the Xi leadership’s circumstance-driven economic policy course correction was the result of intra-Party political pressure and factional struggle. In assessing publicly available information and signs, however, we believe that Xi’s economic policy shift was mainly of his own volition and not due to pressure from political enemies.
It is not uncommon for the CCP regime to make sudden and drastic shifts in policy when facing severe crises as it turns to pragmatism for the sake of survival. The best example of this is Deng Xiaoping’s promotion of “reform and opening up” after the Mao years. As for Xi Jinping, he abruptly did away with “zero-COVID” — which was damaging the Chinese economy, impacting people’s livelihoods, and eroding the Party’s political legitimacy — after securing another term and expanding his power at the 20th Party Congress. After drastic policy shifts, the Party would rely on propaganda to sell the shift as a “positive development,” praise the “wisdom” of the CCP leadership, and highlight the Party’s “dedication” to the “people’s happiness.”
We believe that the Xi leadership will find it immensely difficult to stimulate the economy under present circumstances. As we previously analyzed (see here and here), Beijing’s recent economic support measures could provide some short-term relief to the capital market and real estate sector, but do not resolve the fundamental issues dragging down the Chinese economy and are unlikely to sustain the recent gains. Meanwhile, factors such as the renminbi exchange rate, capital outflows, the local debt situation, various financial risks, and bureaucratic inefficiencies will constrain the economic policies and measures that the Xi leadership could later introduce. It is also likely that Beijing is wary of rolling out stimulus that repudiates its past efforts at deleveraging and derisking. Finally, how aggressively the Xi leadership can carry out stimulus is somewhat constrained by the pace of the U.S. Federal Reserve’s rate cuts and other international economic and financial factors.
2. The sitting of senior Party cadres Li Ruihuan and Wen Jiabao on either side of Xi Jinping at the 75th national day reception is certainly unusual, but it may not necessarily mean that Xi’s grip on power has weakened. Many of the allies and confidants of former Party leaders, including the “tuanpai” (“Communist Youth League faction”), have either been removed or retired from the current core leadership circle at the 20th Party Congress. This means that Party elders have less ability to influence the Xi leadership now, and Xi Jinping does not have any special reason to cave to them.
We believe that Xi having Li Ruihuan and Wen Jiabao beside him at the national day reception is likely his attempt to showcase intra-Party unity to external observers. Xi could also be indicating that his economic support measures have the endorsement and support of senior Party cadres and key officials in previous leaderships.
3. The assessment by Chinese observers that Xi Jinping has been moving against military loyalists is also unconvincing upon closer examination.
Chen Guoqiang was promoted up the ranks after Xi took office, but his rise was not exceptionally rapid or notable. This suggests that Chen is not necessarily a Xi loyalist or ally in the military. Also, Chen was not necessarily sidelined; having reached the retirement age for officials at the deputy theater command grade, Chen’s lateral transfer to the National University of Defense Technology actually allows him to put off retirement and stay in office for a few more years in a “second-line” position.
The rumor that Xi ally Zhong Shaojun was appointed political commissar of the PLA National Defense University remains unconfirmed, and there is no news of current National Defense University political commissar Zheng He retiring. But if Zhong was really transferred to the National Defense University, that would mean that preparations are underway for him to be promoted to full general. While the National Defense University is a deputy theater command grade institution, all previous presidents and political commissars of the university were promoted to the rank of general. Because Zhong is currently 56, he is eligible for further career advancement if he rises to the general rank, including potentially becoming CMC Political Work Department director.
Finally, the rumors that Qin Shutong and Qin Shengxiang are being investigated have not been confirmed. Even if the two were probed, it could be part of Xi Jinping’s broader anti-corruption campaign to “rectify” the military and not because Xi was removing loyalists and allies under pressure from his political opponents.
4. We believe that Xi Jinping’s grip on power remains secure for the moment. However, the continued and rapid deterioration of China’s economy and mounting financial risks pose a very serious threat to the “quan wei” of Xi and the CCP authorities.
