Prominent Taiwanese corporations entrenched in the Chinese economic landscape may find themselves compelled to relocate if they sense undue coercion, cautioned Taiwan’s Vice President. This warning followed the initiation of an investigation by Chinese authorities into the affairs of Foxconn, a Taiwan-based conglomerate renowned as one of the world’s foremost contract manufacturers of electronics, including being a pivotal supplier to Apple for their iconic iPhones. The probe, as reported by China’s state-controlled Global Times, encompasses tax and land-related inquiries spanning several Chinese provinces, though the exact nature of the allegations or transgressions committed by Foxconn remains undisclosed.
In response to these developments, Foxconn has expressed its willingness to collaborate with the relevant authorities concerning the specific aspects under investigation, while refraining from divulging additional particulars. These investigations unfold against the backdrop of Taiwan, a self-governing entity which China claims as its own territory and aspires to subdue, gearing up for presidential elections slated for January.
Vice President Lai Ching-te, the current leading candidate in the upcoming elections and the head of the pro-independence Democratic Progressive Party (DPP), underscored the possibility that Taiwanese businesses could contemplate relocating their operations away from mainland China if they perceive undue duress. Lai articulated, “If they grow wary and apprehensive, losing faith in their relationship with China, they may gradually shift their operational hubs to other nations,” ultimately posing a substantial setback for China. Lai implored China to cherish and uphold Taiwanese enterprises, refraining from exerting unwarranted pressures, particularly during election cycles, whereby these businesses are solicited to declare loyalty or support for specific candidates.
It is noteworthy that Foxconn, also known as Hon Hai Precision Industry, stands as the most extensive private-sector employer in China, boasting a workforce exceeding one million employees spread across the nation. Additionally, the company’s billionaire founder, Terry Gou, who delegated managerial responsibilities four years ago, has entered the political arena as an independent candidate in the imminent presidential elections. The competing presidential candidates include Hou Yu-ih from the principal opposition Kuomintang party and Ko Wen-je, a former mayor of Taipei, representing the Taiwan People’s Party. Ko, in response to the Foxconn investigation, characterized Taiwan as a “global orphan,” confronting the consequences of deteriorating cross-strait relations with China. He emphasized the paramount challenge faced by the Taiwanese government, which is the lack of a viable means to engage in dialogue with China on behalf of Taiwanese corporations.
The complexities of this situation have emerged primarily due to the election of President Tsai Ing-wen in 2016, an individual Beijing disapproves of for her refusal to recognize Taiwan as part of China’s dominion. Consequently, China has severed communication channels with the Taiwanese government while intensifying military, diplomatic, and economic pressures on the island nation.