Is Taiwan Moving Toward Finlandization?


By So-Heng Chang

Some scholars assert that “Finlandization” is developing between Taiwan and China, since both governments have been moving into a closer economic integration and political reconciliation following the 2008 election of Taiwanese President Ma Ying-Jeou. This détente stage, according to these scholars, opens the way for the Finlandization of Taiwan. These observers even recommend that the United States should adjust policy both strategically and diplomatically to encourage a Finlandized Taiwan, including halting arms sales to the island and removing it as a major player in the United States’ Asian security strategy. It is believed that these actions will reduce tensions in the Taiwan Strait, demilitarize conflict with China, and accomplish regional stability and peace in East Asia.

What are the implications of Finlandization? Is it really appropriate to compare Soviet-era Finland with present-day Taiwan? Let us begin with a historical perspective. The term Finlandization was used in Europe during the Cold War era. It primarily expressed Finland’s predicament as it sought survival under threat from its superpower neighbor, the Soviet Union. Finland signed an Agreement of Friendship, Cooperation, and Mutual Assistance with the Soviet Union in 1948. According to this treaty, Finland was obliged to resist armed attacks against the Soviet Union, and adopt a neutrality policy in conflicts between the United States and the Soviet Union. In return, the Soviet Union recognized that Finland retained a democratic and parliamentarian system. As a consequence, Finland maintained its national sovereignty and national security. However, the agreement resulted in numerous human rights violations in Finland, such as prohibition of anti-Soviet speech, limitations to freedom of the press, and self-censorship throughout the remainder of the Cold War.

As Finlandization began, China was in the middle of civil war. In 1949, a political split resulted in the formation of two governments in China; the Republic of China (ROC) on Taiwan and the People’s Republic of China (PRC) on the mainland. Each side views the other as the enemy. But, recently, something has changed. The cross-strait tensions have been reduced to one of its lowest levels ever. Much of this de-escalation is attributed to Taiwan’s President, Ma Ying-Jeou, who took office in 2008. President Ma’s mainland policy is to diminish high tension between Taiwan and China, and to try to find a way to achieve the win-win scenario, not the zero-sum game. For now, both governments have temporarily put aside the highly sensitive sovereignty issue, while focusing on economic cooperation and continued negotiations. Whether Taiwan’s recent actions demonstrate a Finlandization of the island is contested, however.

Taiwanese Popular Opinion

Finlandization, as a concept, has been discussed in Taiwan in the past, but it has not been accepted by the majority of citizens. President Ma’s 2008 inauguration address established, and his recent two year anniversary press conference reaffirmed, his mainland policy of “no unification, no independence and no use of force.” Recent polls indicate that the status quo is the mainstream public opinion preference in Taiwan. The Taiwanese people would like to perpetuate the current condition rather than move toward independence from— or unification with— China. The ruling Kuomintang (KMT) party has always tried to foster peace with Communist China, even during the eight years of Democratic Progressive Party (DPP) rule. Though the KMT is in power now, if it makes any moves to get closer to China, the DPP will oppose KMT policies and protest through boycotting congressional actions and organizing street demonstrations, among other measures.

The DPP’s platform and supporters advocate independence. Under this condition, no KMT politician dares to make sensitive unification plans or schedules with China. The DPP is worried that KMT’s steps toward cooperation with China will jeopardize Taiwan’s sovereignty. The KMT’s resoluteness about the “three no” principle— no unification, no independence, no use of force— makes these concerns seem exaggerated. The “no unification” policy means Taiwan will not unify with China. Taiwan is a democracy and the Taiwanese people want to remain separate from mainland China as long as that territory is ruled by a dictatorship. The “no independence” policy means that China and the United States do not have to worry about Taiwan moving toward independence and changing the status quo. The “no use of force” policy involves preventing China from using force to invade Taiwan. So far, the three no’s principle has majority approval in Taiwan. Of course, this will not satisfy everyone, but it is the best policy option for now. In other words, if someone promotes Finlandization, he or she would be criticized severely from the people of Taiwan—especially from opposition parties.

Furthermore, if the KMT promotes a Finlandization policy, it would lead the party to a large-scale failure in any election. Even the KMT’s current mainland policy, especially its signing of an economic cooperation framework agreement (ECFA) with China, is still heavily criticized by the DPP. If the KMT loses the special municipality election on November 27, 2010, not only will the KMT need to adjust its mainland policy, there might also be serious consequences for the re-election of President Ma.

Beyond this, Finlandization would threaten the vibrant democratic system of Taiwan. Freedom of speech, news and publishing would be deprived, civil rights would be limited, internal political maneuvering would increase and Taiwan might become unstable. Efforts toward Finlandization were supported by the Finnish people during the Cold War as an alternative to Soviet military occupation. But, in Taiwan, this Finlandized model is unacceptable to the majority of the island’s people who do not fear a PRC invasion so long as the United States supports Taiwan’s freedom to choose its own system of governance. A shift toward China would mean a loss of democracy, which Taiwan fought for decades to achieve. Finlandization would not be a model to the people of Taiwan, as it could lead the island toward turmoil, or even a democratic disaster

Disputed Sovereignty

In 2008, the KMT won the Republic of China’s presidential election. The new administration has sought to ease the high tension of the Taiwan Strait issue, respect the constitution, maintain the status quo in the Taiwan Strait, and assert “one China, respective interpretations consensus” which was reached by the two sides in 1992. Under this condition, President Ma hopes to seize on an opportunity to achieve peace and co-prosperity between Taiwan and China. The Ma administration has begun negotiations and completed several important economic memorandums or accords with China. Visits by high-level officials have continued and become more frequent. In their economic relations, the two sides are interacting more smoothly than ever before. But, inevitably, they often face the sensitive sovereignty problem.

Sovereignty is the most volatile issue between Taiwan and China. Taiwan is—and has been—a sovereign state for decades. The island possesses its own government, armed forces, flourishing economy, territory and flag. China insists that Taiwan is a province of it, and claims that it will use all means against the island if it would declare independence. Today, there are two Chinese entities in reality, but both sides agree that there was one China, and they both insist it is theirs. Indeed, the situation is ambiguous, and has been for decades. Therefore, the “one China, respective interpretations consensus,” is the best principle for negotiation under present conditions for both Taiwan and China. It could avoid sensitive sovereignty disputes temporarily while promoting lasting dialogue and negotiation.

This condition is much different than Finland’s case. In Finland, sovereignty was already established and recognized by the Soviet Union; the neutrality policy was also tacitly agreed to by NATO and the international community. But China claims Taiwan as part of its territory, denying Taiwan’s status as a sovereign country. Moreover, the principle of Finlandization requires recognizing Taiwan’s sovereignty, which directly challenges Beijing’s “one China” principle. China would not accept such an idea. China’s position toward Taiwan is “one country, two systems,” just like the “Hong Kong model.” However, if Taiwan moves toward the “Hong Kong-ization,” the subsumed Taiwan will lose everything.

Historical Lessons

In 1973, the United States adopted a “Vietnamization” policy, which advocated for an independent, non-communist South Vietnam and the withdrawal of all U.S. troops from that country. The result was the unification of Vietnam into a single communist country in 1975. This has been an important historical lesson for the Taiwanese people. Their country relies on great powers to protect it which makes the island an uncertain environment. The destiny of protected countries will be decided by the great powers according to their own interests.

U.S Interests

For the United States, the “one China” policy and maintaining the status quo have been fundamental policies since the Shanghai Communiqué of 1972. If Taiwan moves toward Finlandization, the regional strategic status quo must be changed, which will directly affect U.S. interests and security. The United States would face three potential scenarios regarding Taiwan and China. First, a united China would enhance national power and wealth, invigorate China to modernize its military capabilities, and increase Chinese confidence to challenge U.S. strategic security and interests in Asia. The United States’ hegemonic status would be challenged.

Second, without security cooperation with Taiwan, the United States would lose significant strategic, as well as geographical, positioning against China. The United States would also lose the significant intelligence information which Taiwan continually provides. Taiwan is a unique asset to the United States. No one can understand China’s thoughts better than Taiwan, because the two sides have the same language, culture and traditional customs.

Third, a unified China would grow unchecked. This would cause neighboring countries to adopt bandwagon policies toward China to ensure their security. The regional powers—such as Japan and India—would come under stress and try to strengthen their military capabilities, perhaps driving Japan to develop nuclear weapons. Those evolutions could increase tensions in Asia.

According to a U.S. Defense Intelligence Agency unclassified summary, released this year, China’s army “has increased the quantity and sophistication of its ballistic and cruise missiles and fighter aircraft opposite Taiwan, which has diminished Taiwan’s ability to deny China’s efforts to attain air superiority in a conflict.” The military power gap between Taiwan and China is widening. If Taiwan does not acquire more advanced weapons soon, the Taiwan Straits’ situation will become more perilous in the near future. Some scholars claim that the United States is responsible for maintaining peace and security in the Asia-Pacific region. A growing security gap across the Taiwan Strait will send the wrong message to mainland China and damage the credibility of the United States among its allies, such as Japan, South Korea, and Singapore.

If the military balance shifts radically to the PRC’s favor, then even Finlandization could bring additional advantages. The long-standing risk of military conflict between the United States and China would be largely reduced as Taiwan’s sensitive issues of sovereignty, arms sales, and independence decreased. But, balancing the gains and losses, keeping the status quo in the Taiwan Strait is still in the best interest the United States in the long-term.

Looking Ahead

Today, it is obvious that the cross-strait relations have shifted from confrontation to negotiation, and from conflict to reconciliation. These improvements have reduced protracted regional tensions and enhanced the stability of the Taiwan Strait. This peaceful atmosphere not only could improve political relations between Taiwan and China, but also might help both sides strengthen their national capabilities through trade cooperation or economic integration. For a free and democratic Taipei, the principles of no unification, no independence, no use of force and maintaining the status quo, are in keeping with the mainstream’s public opinion. These principles should guide the present as well as the foreseeable future.

So-Heng Chang is a visiting scholar at the Foreign Policy Research Institute, an associate research fellow at Cross-Strait Interflow Prospect Foundation, and a Ph.D. candidate at Cheng-Chi University in Taipei.

Published by the Foreign Policy Research Institute

Founded in 1955, FPRI ( is a 501(c)(3) non-profit organization devoted to bringing the insights of scholarship to bear on the development of policies that advance U.S. national interests and seeks to add perspective to events by fitting them into the larger historical and cultural context of international politics.

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