Source from BusinessWeek

Jan. 14 (Bloomberg) — Taiwan’s 18 million voters are deciding today whether President Ma Ying-jeou’s work to improve relations with China merit him a second four-year term.

Ma, 61, and his main opponent, Democratic Progressive Party Chairwoman Tsai Ing-wen, made final appeals to voters yesterday. Tsai, 55, worked to damp concern that her victory would harm relations with China, which considers Taiwan part of its territory and has said Tsai’s position will set back cross- strait relations. Ma touted Taiwan’s economic growth and renewed ties with the mainland, which will also undergo a leadership change this year.

“We will form a cross-strait dialogue team with members including reputable social leaders, and build a mutually trusted communication channel between the new government and China,” Tsai said in Keelung, a port city in northern Taiwan. “The government will accept all existing agreements and hope to build new cross-strait consensus and reach new agreements with China that will benefit both sides.”

A Ma win may offer a mandate to forge ahead with agreements expanding cross-strait trade and investment. A win by Tsai would suggest voters are more concerned about a widening income gap and an economy where growth slowed to 3.4 percent in the quarter ended Sept. 30, from 6.6 percent in the first three months of last year.

Ma, who heads the Kuomintang Party, says that a surge in two-way trade, investment and tourism across the Taiwan Strait helped Taiwan’s export-dependent economy.

Raise ‘Competitiveness’

“So support Ma Ying-jeou’s cross-strait policy,” Ma said at a rally yesterday in Taiwan’s Miaoli County. “That will raise Taiwan’s competitiveness.”

Tsai counters that the links Ma engineered with the mainland risk eroding Taiwan’s autonomy. Ma is backed by business leaders including Terry Gou, chairman of Foxconn Technology Group, which has more than 1 million employees in China.

The U.S. stance on the election became a focal point of attention yesterday after Douglas Paal, a former head of the American Institute in Taiwan, the de facto U.S. embassy, was cited in the local media as saying he supports the so-called 1992 consensus that Ma’s Kuomintang and the government in Beijing use as a basis for their negotiations.

Tsai doesn’t recognize the consensus, in which both sides agree that there is only one China, with each party differing on the meaning. Paal also criticized Tsai’s plan to forge a “Taiwan Consensus” on relations with the mainland, according to the English-language Taipei Times.

“Irresponsible” Comments

Former Senator Frank Murkowski, an Alaska Republican who is an election observer, told reporters in Taipei that Paal’s comments were “irresponsible” because they gave voters the impression that the U.S. was backing Ma in the election. The U.S. says it isn’t taking sides in the contest. Paal, in an e- mail, said he spoke “only for myself” in making comments on the consequences of policy choices.

“It’s hard to imagine bilateral relations without the 92 consensus,” Cher Wang, Taiwan’s richest person and chairwoman of HTC Corp., told reporters yesterday in Taipei. “It’s impossible to understand there are people who don’t believe in the 92 consensus.”

Voting Starts

Voting stations opened at 8 a.m. local time and close at 4 p.m., with tallies posted on the Central Election Commission website after they shut. Voters must be at least 20 years old.

“I was expecting the candidates to lay out plans on how to develop Taiwan in the next four years, but I don’t see that in any of the candidates,” Murphy Lin, 37, manager at a recycling technology company, said today as voters gathered in Xinyi, the business district of the capital, Taipei. “Ma’s performance in the past four years was mediocre. He didn’t really do anything. Tsai has some visions, but she has failed to turn them into concrete actions.”

Ma is an “honest person,” said David Feng, 63, a retired engineer. “I vote for a candidate who is not corrupt. It’s important for Taiwan to continue to develop relations, not just with China, but to open itself to the rest of the world. That’s the only way for our economy to develop.”

Narrow Lead

Ma was widening his narrow lead over Tsai in public opinion polls taken prior to a blackout period for voter surveys that began Jan. 4. Taiwanese law bars publication or release of polls 10 days prior to presidential elections.

Ma’s camp is showing “a little bit of self confidence,” while the Tsai campaign is showing “a little bit of nervousness,” Paal said in an interview on Bloomberg Television yesterday.

Under Ma’s administration, a six-decade ban on direct air, sea and postal links with the mainland came to an end. Two-way trade reached $160 billion last year, a 10 percent increase from 2010, according to Chinese customs statistics.

As China’s economy slows, Taiwan’s growth also is moderating. Nomura Holdings Inc. forecasts GDP will drop 0.3 percent in the current quarter from a year earlier.

Taiwan’s voters also choose a new parliament today, the first time the two elections have been held on the same day. The ruling KMT kept control of Taiwan’s Legislative Yuan when the opposition DPP held the presidency from 2000-2008. The division of power resulted in delays in implementing government policies, from financial-sector consolidation to defense purchases.

Also seeking the presidency is James Soong, the 69-year-old head of the People First Party, a member of the Kuomintang-led coalition in parliament. Soong, who also supports closer ties with China and could take votes away from Ma, was trailing in public opinion polls taken prior to the blackout period.

The candidate with the plurality of votes wins, and there is no run-off election. The inauguration takes place in May. Taiwan’s presidents can serve a maximum of two four-year terms.