SOAS University of London

SOAS China Institute

Relations between Taiwan and Mainland China: Changing Economic and Political Dynamics

Prof. Shelley Rigger (Davidson College, USA)

Date: 9 April 2019Time: 5:30 PM

Finishes: 9 April 2019Time: 7:30 PM

Venue: Russell Square: College Buildings Room: 116

Type of Event: Round Table

Note: Internal event not open to external attendees.


In 1987, Taiwan lifted a four-decade ban on travel to mainland China. Within a year, Taiwan’s many traditional manufacturers were decamping to the mainland, which offered relief from the island’s rising labour and land prices and growing environmental regulations. Most of the firms that moved were suppliers and subcontractors to MNCs; moving across the Strait boosted their margins, while enabling lower prices for customers. In the 1990s, Taiwan’s economy expanded into high tech industries, including semiconductor foundries and EMS. Those firms, too, soon found opportunities to cut costs by moving some operations to the mainland. These trends produced three decades of win-win growth for Taiwan and the PRC. The Taiwanese firms’ existing relationships with global firms enabled China to enter global supply chains. Indeed, Taiwanese firms played an indispensable role in China’s emergence as an export manufacturing hub.

These salutary economic developments coexisted with an up-and-down political relationship between the two sides. Even at moments of high political tension, Taiwanese investors and Chinese local officials kept busy making deals that brought jobs and opportunity to countless mainland localities. In recent years, however, the economic relationship seems to be following the downward trajectory in the two sides’ political relations. The links between economics and politics are complex; the economic changes are products of multiple factors, including improvements in China’s domestic manufacturing and technical capacity as well as increasing production costs that are pushing some Taiwan-based firms into other markets. Nonetheless, deteriorating political relations are accelerating the two sides’ economic disentanglement.

In this session, we will explore how the two economies became intertwined, and how politics in the Strait have – and have not – affected economic relations. And we will consider the future: Can the two sides continue to thrive in business together, given the deteriorating political environment?


Shelley Rigger is the Brown Professor of East Asian Politics and Chair of Chinese Studies at Davidson College. She has a PhD in Government from Harvard University and a BA in Public and International Affairs from Princeton University.

She has been a visiting researcher at National Chengchi University in Taiwan (2005) and a visiting professor at Fudan University (2006) and Shanghai Jiaotong University (2013 & 2015). She is a non-resident Fellow of the China Policy Institute at Nottingham University and a Senior Fellow of the Foreign Policy Research Institute (FPRI). She is also a director of The Taiwan Fund, a closed-end investment fund specialising in Taiwan-listed companies.

Rigger is the author of Politics in Taiwan: Voting for Democracy (Routledge 1999) and From Opposition to Power: Taiwan’s Democratic Progressive Party (Lynne Rienner Publishers 2001). In 2011 she published Why Taiwan Matters: Small Island, Global Powerhouse, a book for general readers. She has published articles on Taiwan’s domestic politics, the national identity issue in Taiwan-China relations and related topics. She is working on a study of Taiwan’s contributions to the PRC’s economic take-off and a study of Taiwanese youth.

Organiser: SOAS China Institute

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