Eight Years of Reform Create a Better Taiwan
Vice President Wu, Former Vice President Siew, Presidents of the Five Yuan, Senior Presidential Advisors, National Policy Advisors, Senior Officials, Honored Guests, Fellow Countrymen, and Overseas Compatriots:
Happy New Year!
Today we are here to commemorate the 105th anniversary of the founding of the Republic of China. For the past eight years, I have used this day to reflect on the past, and peer ahead into the future. Fifteen days from now we will elect a new ROC president and a vice president, so today marks my final New Year's address as president.
To begin, I want to take this opportunity to express my sincere thanks to each and every one of you. I want to thank the people of Taiwan for twice electing me as your president, for believing in me, and putting your faith in me. As president, I have had a chance to work with you and do great things, things that have never been done before. For me, that's what has been most touching—and most inspiring.
Today, I'd like to talk about three key achievements, and offer three reminders about Taiwan's future. So as we look back on what we've accomplished, I also want to address the challenges of tomorrow.
I. First Key Achievement: Great progress on the diplomatic front and friendly international relations
Over the past seven-plus years we've actively advocated a policy of viable diplomacy, and played the role of peacemaker and provider of humanitarian aid. Our successes have won respect in the international community. Our relationships with the United States, Japan, the European Union, the Association of Southeast Asian Nations (ASEAN), New Zealand and Australia in terms of security, economics and trade, culture, and education have never been stronger over the past 30 or 40 years. The US has sold us arms worth more than US$20.1 billion, far higher than total sales during the previous two administrations. And we are cooperating more closely in the military sphere. In the past seven years we've signed 28 agreements with Japan, far more than in the past, constituting 45% of the 61 bilateral agreements we've signed over the past 60 years.
We interact with our 22 diplomatic allies often, and our relationships are stable. One achievement that has really resonated with the public is the increase in the number of countries or territories that grant us visa-waiver, landing-visa, or other visa privileges, making it much more convenient to travel abroad. Between the year 2000, and the year 2008 when I took office, only 54 countries granted us those privileges. But over the past seven years, we've gained about three times more, adding 107 additional countries or jurisdictions for a total of 161. In the global Passport Power rating, an ROC passport now ranks in the top 25, and as our visa privileges have increased, so has the number of outward bound travelers.
At the same time, Taiwan has become a more popular destination for international travelers. Last year, Skytrax rated Taiwan Taoyuan International Airport staff as the best in the world. And data released last August by the Airports Council International (ACI) named Taiwan Taoyuan Airport the "most efficient airport," beating out Hong Kong for the first time.
Visitor arrivals in Taiwan have also increased, and just 11 days ago we surpassed 10 million foreign visitors for the year 2015. Last year, tourist arrivals totaled over 10.43 million discrete visits. That's 6.72 million more visitors than the 3.71 million who came in 2007—the year before we took office, and a new historical high. Over the past four decades, it usually took 13 to 16 years to increase the number of foreign visitors by one million. But during our administration, we've increased the number of foreign visitors by that amount every year. And the annual growth rate for foreign visitors and foreign exchange income is five times what it was before I became president, further testimony to the international community's goodwill toward Taiwan.
At the same time, Taiwan has made numerous breakthroughs on the international front. In 2008, after an absence of 38 years, the ROC's Minister of Health and Welfare began attending the World Health Assembly (WHA), and has continued to do so every year. In 2013, after an absence of 42 years, the Director General of our Civil Aeronautics Administration participated in the Assembly of the International Civil Aviation Organization (ICAO), which was a symbolic breakthrough with very practical implications. In 2010, Taiwan also acceded to the Agreement on Government Procurement (GPA) under the World Trade Organization (WTO). In terms of participating in the international community, these are some of our most outstanding achievements since we lost our seat in the UN in 1971.
Even more important, the Republic of China has shed its image as a troublemaker and become a regional peacemaker. On August 5, 2012, I proposed the East China Sea Peace Initiative, based on the idea that although sovereignty over national territory can't be compromised, natural resources can be shared. That initiative calls on all parties to replace confrontation with dialogue, and resolve disputes in the East China Sea through peaceful means.
In April of 2013, we also signed a fisheries agreement with Japan, resolving a 40-year old dispute. That agreement allows Taiwan's fishing boats to operate in over 70,000 square kilometers of prime fishing grounds near the Diaoyutai Islands. Now, even vessels from Kaohsiung and Pingtung head north to catch bluefin tuna. So in reaching this agreement, we were able to make significant progress on fishing rights while yielding nothing in terms of sovereignty.
Four days ago, Japan and Korea also reached an agreement regarding the so-called "comfort women" issue from World War II. That agreement calls for Japan to submit an apology and pay compensation of 1 billion yen to the Korean victims. Three days ago I reiterated our position, and our long-standing demand that Japan make an apology, pay compensation, and also give former "comfort women" from Taiwan due justice and due respect. I also instructed the Ministry of Foreign Affairs to have our representative stationed in Japan assert our demands to the Japanese authorities again. Our dispute with Japan regarding the "comfort women" issue has already dragged on for over 20 years. We need to expedite this case, and resolve it, especially as the number of surviving "comfort women" rapidly dwindles. Yesterday I paid a special visit to a former so-called "comfort woman," and personally guaranteed that the government will definitely stand by them.
Following the success of the East China Sea Peace Initiative, I announced the South China Sea Peace Initiative on May 26 of last year, advocating that all parties safeguard sovereignty, shelve disputes, pursue peace and reciprocity, and promote joint exploration and development. We then signed the Agreement Concerning the Facilitation of Cooperation on Law Enforcement in Fisheries Matters with the Philippines on November 5, stipulating that both parties shall avoid the use of force in maritime law enforcement operations, provide one-hour advance notice before commencing such operations, and release detained vessels and crews within three days. That was a very significant, concrete achievement.
I'm sure you all remember what happened on May 9, 2013, when a Philippine coast guard vessel fired on and killed a Taiwanese fisherman of the Guang Da Xing No. 28 during operations in overlapping exclusive economic zones. That very same evening, we demanded that the Philippines offer an apology, provide compensation, punish the perpetrators, and negotiate a fisheries agreement with us. And in just three months, by marshalling all of our resources and utilizing every means possible, justice was served for the family of the victim and the other fishermen involved. After numerous rounds of negotiations, we were also finally able to sign that agreement with the Philippines. This is what the previous administration failed to achieve.
Actually, our fisheries dispute with the Philippines has been going on for 40 years. In 1980, when I was still at Harvard University working on my PhD, I was invited to come back to Taiwan to participate in the National Development Seminar. I wrote an article that was published in the United Daily News, entitled "Taiwan-Philippines Fisheries Dispute from the Perspective of International Law", in which I made the case for a long-term, comprehensive, and thorough policy regarding fisheries negotiations with the Philippines. I also emphasized using peaceful means to settle that dispute. At the time, I never thought that I would become the president who would implement the solution I proposed as a student 35 years ago, reducing the number of fishing disputes between Taiwan and the Philippines while offering real protection for the lives and property of our fishermen.
My concern for this issue over the past 35 years is more than just realizing my own ideals. Even more important is that we brought about a change that was significant for Taiwan and the international community. We have assuaged the longstanding fears of fishermen from southern Taiwan, and finally taken the first step toward peace and co-prosperity in the South China Sea.
My fellow countrymen, you can see that "viable diplomacy" does not mean inaction. It's not passive. Viable diplomacy does mean putting a stop to our pointless competition with the mainland for allies in the global community, and actively playing an important role in that community by providing humanitarian aid and promoting peace. Should we ever return to the path of "scorched earth diplomacy," history may repeat itself. Then we may find ourselves in dire straits like the previous administration, with allies abandoning us left and right, and international organizations barring us from participating. We need to embrace the correct policy direction, and stay the course. That's the only way we can perpetuate the cycle of positive diplomacy of the past seven-plus years, and avoid undermining the sovereignty of the Republic of China and the dignity of Taiwan's people.
II. Second Key Achievement: Cross-strait bridges and sustainable peace
Over the past seven-plus years, we have successfully transformed the Taiwan Strait from a flashpoint of conflict into a path to peace. Since I took office in 2008, I have staunchly maintained the status quo of "no unification, no independence, and no use of force," in accordance with the framework of the ROC Constitution. I have also promoted peaceful development across the Taiwan Strait based on the 1992 Consensus of "one China, respective interpretations." Taiwan and mainland China have signed 23 agreements to date, and ministers from each side in charge of cross-strait affairs have met on seven occasions, addressing each other by their official titles. Over the past seven-plus years, daily cross-strait flights also went from zero to 120. The number of mainland tourists hit 18 million, and the number of mainland students increased over 40-fold to 35,000.
Having cultivated sufficient mutual trust, we finally achieved a major breakthrough in cross-strait relations. On November 7 of last year, I met mainland Chinese leader Xi Jinping in Singapore based on the principles of equality and dignity, and exchanged views with him on consolidating cross-strait peace and maintaining the status quo across the Taiwan Strait. Our meeting showed that the leaders of the two sides have already established a communication mechanism for the peaceful handling of disputes, setting a very positive example for the international community.
The day before yesterday, Taiwan's Mainland Affairs Council Minister Andrew L. Y. Hsia (夏立言) and Minister Zhang Zhijun (張志軍) of mainland China's Taiwan Affairs Office held a 30-minute conversation using the newly opened cross-strait hotline, turning the first consensus reached at the Ma-Xi meeting into a concrete reality. At the same time, the two sides of the Taiwan Strait have reached an agreement that allows graduates of mainland technical colleges to come here and enroll in two-year programs at tertiary educational institutions in Taiwan. Beginning this year, the quota for mainland students will also be increased to 1,500 students. That agreement is the second consensus from the Ma-Xi meeting that has been brought to fruition.
In March of 1987, when I served as Secretary to President Chiang Ching-kuo, I remember him asking me one day, "Ying-jeou, has anything important happened recently?" I replied, "Some members of the Legislative Yuan have suggested that veterans should be allowed to go to the mainland and visit their families." At that time, President Chiang had already made up his mind that people in Taiwan would be given permission to do that. The planning for that policy was entrusted to Chang Tsu-yi (張祖詒), then deputy secretary-general to the president, who told me to write a policy draft. I was kind of apprehensive, so I was extra careful, and didn't send out my hand-written documents to be typed. When I finished it, I locked it in my filing cabinet. I also wrote "Yingkao Project" at the top, [穎考；a reference to a Classical Chinese story of compassion and family reunion] before it was officially submitted on June 4 of that year. Several months later, on November 2, visits were officially permitted.
At that time there was still a lot of cross-strait animosity, so families separated by the Taiwan Strait couldn't get together. And when people from Taiwan did travel to the mainland to visit their families, they had to go through Hong Kong, a tragedy of everyday people trapped in the historical realities of that era. When I was the mayor of Taipei City, I once visited a retired employee of National Taiwan Normal University. During the chaos of war he had been separated from his fiancée, and came to Taiwan by himself. He never thought about marrying anyone else. After visits to the mainland were allowed in 1987, he managed to contact his fiancée, and discovered that they had both been faithful to their pledge, and had never married. They rekindled their relationship, and he brought her over to Taiwan for good. After all these years, I still get inspired when I think about the heart-warming stories from that era.
Thinking back on those times, we can see how far we've come. Now the leaders of the two sides, watched by billions of people around the world, can meet to talk about peace. Back then, that kind of dramatic change in cross-strait relations was inconceivable. The Ma-Xi meeting built a bridge that connects the two sides of the Taiwan Strait. That bridge provides a new model for the respective leaders to hold meetings and discussions on an equal footing, and gives future leaders a model to emulate so they can maintain the status quo of cross-strait peace and prosperity. Thinking back to those days 28 years ago when I worked with President Chiang on the Yingkao Project, I can say without reservation that this bridge we've built, this bridge of peace, has closed the gap across the strait and transcended the historical barriers. So I sincerely hope that my successor will wholeheartedly cherish that bridge and not negate my intentions.
III. Third Key Achievement: Care for the disadvantaged and realizing social justice
For the past seven-plus years we have been devoted to increasing benefits for the disadvantaged, reforming national finances, and promoting labor rights.
In October of 2010 we instituted National Health Insurance (NHI) system reforms, implementing a special program to provide medical care to underprivileged groups. And although 690,000 people were unable to access the health insurance system in 2007 due to nonpayment of premiums, that number has shrunk to only 40,000 today. So we won't be seeing people denied medical care because they can't afford the premiums. In 2013 we implemented the second-generation NHI, significantly improving the program's financial health. Last year, we also passed the Long-term Care Services Act, and we continue to promote Long-term Care Insurance Act legislation to provide a more comprehensive security plan for seniors in their golden years.
To make our nation's financial system more equitable and more efficient, we've also rolled out a "feedback tax system" so that people with high incomes can give back to society, decreasing the burden on the less fortunate. We've also moved from a full-credit imputation tax to a partial (50 percent) credit imputation tax, increased the highest marginal tax rate for general income tax, and restored business tax rates for the financial sector. For 2015 and 2016, we project those measures will generate an additional NT$90 billion in national tax revenues and decrease the tax burden on underprivileged families. In August of 2012, we also implemented actual price registration for real estate, gradually improving the transparency issues that had long plagued the housing market.
Over the past seven-plus years, the government has appropriated a total of NT$44 billion to assist 680,000 households to buy, rent, or renovate housing. That's a historical high, and 16 times more than the previous administration. And today, the new consolidated housing and land tax system takes effect, which will minimize speculation, advance wealth equality, and promote residential justice.
We are not offering empty, high-sounding phrases or impractical pronouncements with no basis in fact. But for the people of this country—and especially for young people—this administration has provided more loans and subsidies for buying and renting homes than any administration in our nation's history. The Ministry of Finance announced yesterday that starting today, the ceiling on housing loans to young people has been raised from NT$5 million to NT$8 million.
Labor is the foundation of national development. When labor thrives, Taiwan thrives. The minimum wage for workers has been raised five times, a record for a single administration, and the total increase also ranks as the largest ever. Beginning today, the 84-hour limit on work hours every two weeks has been reduced to 40 hours a week, the lowest in history. In 2009 we also set up the Labor Rights and Interests Fund to help workers who have been terminated under wrongful circumstances file lawsuits. The fund not only covers workers' daily expenses during court cases, but has also helped workers win NT$1.9 billion in compensation. In 2009 we instituted the labor pension system. Over 70 percent of retired workers have applied for related payments, which have totaled nearly NT$400 billion. Retired men and women have told me that the system has given them dignity in old age. As a result of the monthly retirement payments, which they receive until their passing, they no longer have to ask their children or even grandchildren for help.
In 2009 the Council of Labor Affairs also began offering subsidies to workers on unpaid parental leave. That allows a husband and wife who want to take care of their child or children to jointly claim 60 percent of their insured salary for a maximum of one year. By November of last year, over NT$33.3 billion in subsidies had been paid under that program, benefiting more than 367,000 people. We hope to give people peace of mind when they decide to have children and raise the next generation. Fortunately, the overall birthrate rebounded to 1.17 in 2014, and our parental leave allowance system has been lauded by the World Bank.
So overall, maybe we still didn't do enough, especially in terms of pension reform. We sent a draft to the legislature in 2013, but much to our regret, it has yet to pass. Nevertheless, this administration has still provided more benefits to labor and the disadvantaged than any other administration over the past few decades. Over the years, the ratio of this central government administration's overall budget devoted to social welfare has been the highest.
IV. First Reminder: Taiwan solidarity and cross-strait peace
While I have great hopes for the future of the Republic of China, I also have some concerns. So I have three reminders that I'd like to share with you.
The first reminder is that I hope the cross-strait policies of the next administration will continue in the right direction, following the pragmatic and effective policies that we have implemented for the past seven years. Since the beginning of my first term, the two sides of the Taiwan Strait have created a cooperative model through reconciliation and exchanges, ushering in the most stable and peaceful period in cross-strait relations since the two sides came under separate rule 66 years ago. This stands in stark contrast to the isolation and conflict we experienced before I took office.
Currently, all three pairs of presidential and vice presidential candidates propose to maintain the status quo. That's never happened before. Maintaining the status quo is already the Taiwan Consensus, and the 1992 Consensus—one China, respective interpretations— is the basis for cross-strait interaction, the Cross-strait Consensus. The current cross-strait status quo, based on the 1992 Consensus, has not only won high support ratings from the public, but is also an important asset for cross-strait peace and regional stability. So at this point, it's simply impossible to say "maintain the status quo" and "abide by the Constitution" on one hand, and on the other hand remain unwilling to accept the 1992 Consensus that is in complete conformance with the Constitution of the Republic of China. That kind of contradictory attitude not only ignores reality, but actually constitutes a challenge to the status quo. And in the eyes of the rest of the world, that contradiction may even constitute a provocation.
The 1992 Consensus has already become a cross-strait consensus. That fact was best exemplified at my meeting with mainland Chinese leader Xi Jinping in Singapore last November, when we both affirmed that the 1992 Consensus serves as the common political foundation across the Taiwan Strait. Without that foundation, how can we maintain the status quo? This Cross-strait Consensus—a hard-won achievement—also conforms to the ROC Constitution and can safeguard the peaceful development of cross-strait relations. At this time, it is also the most beneficial policy choice for Taiwan. It should be cherished and upheld by the president of the Republic of China, whoever that may be.
Cross-strait peace has been a gradual and cumulative process. It didn't just come out of nowhere, and should not be taken for granted. The peace and prosperity that we have today were unimaginable during the 1996 Taiwan Strait Missile Crisis during Lee Teng-hui's administration and the conflict and antagonism of 2006 during the Chen Shui-bian administration. I sincerely hope the next administration will be wise, and handle things with appropriate caution, and thereby avoid subjecting the people of Taiwan to more turmoil and fear.
V. Second Reminder: Believe in Taiwan, invest in innovation
My second reminder concerns Taiwan's economy. In the past, some political commentators have criticized our economic performance. We have kept an open mind towards those criticisms, and addressed them. Over the past eight years, we have experienced the worst economic recessions since the oil crises of the 1970s, including the global financial crisis—the Financial Tsunami—and the Eurozone debt crisis. The average global economic growth rate of only 2.2% during my tenure has been more than one full percentage point lower than the 3.3% growth rate during my predecessor's time in office. But compared with the past, Taiwan's economy has still continued to improve and garner international acclaim.
According to the Executive Yuan's Directorate-General of Budget, Accounting and Statistics, per capita nominal gross domestic product (GDP) for last year was slightly over US$22,600, US$4, 517 higher than it was seven years ago. That's more than the US$ 3,190 increase during my predecessor's eight years in office.
If we look at annual per capita GDP based on purchasing power parity (PPP)—calculating people's real purchasing power after factoring in consumer prices—estimates show per capita GDP was over US$49,000 last year, an increase of US$14,248, which is also more than the US$12,551 increase during the previous administration. This data shows that over the past seven-plus years, our economic performance has indeed improved. Commodity prices remained stable and relatively low. Income distribution, both for families and individuals, is more equitable than it was six years ago, or even 13 years ago, and was the best among the Four Little Dragons. And in the rankings of the World's Richest Countries announced by US-based Global Finance Magazine in November of last year, Taiwan ranked No. 19, right behind Germany and ahead of France, the United Kingdom, Japan, and Korea.
At the same time, since October of 2010 our unemployment rate has remained between four and five percent, and since April of last year has dropped to between three and four percent. The average unemployment rate from January to November of 2015 was 3.77, lowest in that same period over the past 15 years, and lower than it was before I took office.
Over the past few years the government has also been pushing for industrial transformation and upgrades. Through the concerted efforts of the government and the private sector, we've seen significant progress in the six major emerging industries, which include biotechnology and tourism, and the four key emerging smart industries including cloud computing. We have also ramped up efforts to optimize and transform our core, traditional, and emerging industries. In response to the digital economy and the Internet of Things, we have intensified our efforts to promote Open Data and the Productivity 4.0 initiative. On December 9 of last year the UK-based Open Knowledge Foundation published its Open Data Index, in which Taiwan was ranked No. 1, up from 36th in 2013 and 11th in 2014. The government's efforts to expand open data have thus been acclaimed by the international community.
Indeed, the government has made every effort; nevertheless, we can't upgrade and transform our industries solely on our own. We need to leverage international markets to thrive, so economic liberalization is clearly Taiwan's path to the future. Engagement brings prosperity, while isolation leads to atrophy. But it seems that some people, and some institutional environments, aren't completely ready for that. In an unusual move, The Wall Street Journal published an article entitled "Taiwan Leaves Itself Behind" after the student movement in March of 2014, commenting that in Taiwan, "the consequences of resisting freer trade and economic reform are becoming clear."
In the US-based Heritage Foundation's 2015 Index of Economic Freedom, Taiwan ranked 14th out of 178 economies. But in categories relating to market openness—trade freedom, financial freedom, and investment freedom—Taiwan ranked 43rd, 39th, and 36th, respectively. So to spur economic liberalization, all sectors of Taiwan society need to adopt a more open attitude and actively review the relevant laws and regulations. In fact, the Global Competitiveness Report 2015-2016 released by the World Economic Forum (WEF) shows that the most problematic factor for doing business in Taiwan for multinational corporations is policy instability, ranked first by 17.3% of the respondents. That means multinational corporations are concerned about whether Taiwan will be able to maintain its current policies. Only a more open market and stronger economic competitiveness will allow us to bring our economic advantages into full play, and this is a choice that the next administration and our citizens cannot avoid.
VI. Third Reminder: Forward-looking approach marked by optimism, reason, and courage
My third reminder is about energy. I hope everyone is well aware that Taiwan already faces serious energy issues.
In June of last year the Legislative Yuan passed the Greenhouse Gas Reduction and Management Act. At the COP21 summit in Paris in December, under the UN Framework Convention on Climate Change, countries were urged to work together to make sure that the increase in global temperature is kept under two degrees Celsius by the end of this century. By the year 2050, we have also committed to reducing Taiwan's greenhouse gas emissions to half of the level of 2005. The latest edition of CommonWealth Magazine also cited a research report from the US-based Climate Central think tank that says if global warming pushes average temperatures up by another 2 degrees Celsius, sea levels will rise, leaving 230 million people homeless. And 1.4 million ROC residents will face the possibility that their homes will be underwater.
This is a very serious issue, and ensuring that our energy policies are in line with requirements to reduce carbon emissions will be a formidable challenge. So let's take a look at some of Taiwan's options.
Since I became president, the Renewable Energy Development Act was enacted and we pushed hard to develop renewable energy sources that are clean and have no fuel costs. Land-based wind turbines are one example. We've added 223 units over the past seven years—more than twice as many as the previous administration— and now have a total of 329 units up and running. Our solar power capacity now also exceeds 728 megawatts, a 303-fold increase over the previous administration. But renewable energy sources are still intermittent, and at the mercy of the elements. Power can't be generated at night, on rainy days, or on days with no wind. So according to statistics by the Ministry of Economic Affairs' Bureau of Energy, solar and wind power plants only generate power during 14 percent and 28 percent of a 24-hour day, respectively, which translates into an average of only 3.5 hours and seven hours a day. So you can't tell how long it will take to produce each kilowatt, and you can't really compare that with the certain timing of a kilowatt produced by baseload power sources such as fossil fuel or nuclear power stations, which generate power 24 hours a day. Fossil fuels and nuclear power are still needed for the hours that renewable energy power plants cannot generate power. Power supply has to be continuous, around-the-clock, so solar and wind power aren't suited to serve as baseload power.
Some people think we can both reduce carbon emissions and be nuclear-free, but that kind of thinking is completely unrealistic. We are indeed faced with a dilemma. Taiwan relies on imports for 98 percent of its energy needs, renewable energy cannot serve as baseload power, and the fossil-fuel power stations that generate 79% of our energy increase carbon emissions.
If our Lungmen Nuclear Power Plant is not put into operation and the three existing nuclear power plants that provide 16% of our electricity are all gradually phased out, then power shortages or power rationing will be hard to avoid. In July of last year, The Wall Street Journal published an editorial entitled "Taiwan Chooses Vulnerability" that said given Taiwan's energy situation, rushing to abandon nuclear power is not a wise choice.
My fellow citizens, in my time as president, I've visited university campuses from time to time to chat with students. And since 2011, in a total of over 30 talks at 11 universities, I've always asked the students the same question: "At this stage, what should our priority be—reducing carbon emissions or becoming nuclear-free?" Their answers show that the average ratio of students who make cutting carbon emissions a priority to students who prioritize forsaking nuclear power is about 4:1. Although that's not a rigorous public opinion poll, to a certain degree it does reflect how young people today think about this issue.
We can also look at Japan, because their situation is similar to ours. Taiwan and Japan are both situated in an earthquake zone. Both use independent power grids, and can't import electricity. In fact, due to a lack of domestic energy sources, both countries rely on imports for more than 90 percent of their energy needs. After the Fukushima nuclear accident in March of 2011 Japan gradually suspended operations of its 48 nuclear reactors. They also significantly increased imports of natural gas. But power generation utilizing natural gas emits carbon, and costs four times more than nuclear power. This caused Japan's external trade to go from a six-trillion-yen surplus in 2010—the year before the disaster—to a nearly 13-trillion-yen deficit in 2014. Electricity costs skyrocketed. Three years ago, Japan decided that it would no longer abandon nuclear power. Thus, of the 48 nuclear power reactors that were shut down in 2011, two reactors may come online at the end of this month and next month, respectively, after rigorous inspections. Another 21 reactors are awaiting approval. So in Japan's energy plan for the future, the proportion of energy derived from nuclear power will be maintained at approximately 22%.
According to the United Nations' International Atomic Energy Agency (IAEA) rankings of 31 countries that have operated nuclear power plants from 2012 to 2014, their Unit Capability Factor (UCF) index, which includes efficiency and safety evaluations, shows Taiwan's nuclear power facilities ranked No. 5 in the world. That puts us ahead of the US, Germany, mainland China, Switzerland, Canada, France, Sweden, and the UK. So what about Japan? Because of the Fukushima nuclear accident, they weren't ranked at all. In the 2013 rankings, they only scored 3.5%, which put them in last place. In fact, even in the ten years prior to the Fukushima nuclear accident, the UCF scores of Taiwan's nuclear facilities were far better than Japan's.
We would do well to consider the example that Japan has set. Since the Fukushima disaster occurred, the number of nuclear power reactors worldwide has increased from 435 to 439. That includes oil-producing nations such as Saudi Arabia, the United Arab Emirates, and Iran; countries that are well known for their efforts in developing green energy, such as Sweden, Finland and the UK; and countries that have experienced nuclear disasters in the past such as the US, the former Soviet Union, and Japan. There are 64 additional nuclear reactors now under construction, with 159 more in the design stage.
According to US Central Intelligence Agency (CIA) data, the 31 countries now utilizing nuclear power cover 46% of the earth's surface and account for 62% of the planet's population. The only countries proposing to abandon nuclear power—Germany, Switzerland, and Belgium—are already participating in a nine-country pan-European interconnected power exchange initiative. So obviously, going nuclear-free is not a global trend. The global consensus focuses on clean energy, which means reducing carbon emissions should take priority over abandoning nuclear power.
Last year the UN's Intergovernmental Panel on Climate Change (IPCC) issued its Fifth Assessment Report (AR5), which affirmed that although nuclear power is not without controversy, it is a mature, low-carbon source of baseload power.
Given Taiwan's environmental factors, we can't rule out any energy options. We can't expect zero growth in electricity demand, unless we allow for zero economic growth. The time to face the energy crisis is now. What we don't need is exaggeration and myths. What we need most is straight talk—the truth. Otherwise, it will be hard to develop our economy.
Taiwan doesn't need simplistic formulas like pro-nuke or anti-nuke. We need to carefully choose the energy mix that's best for us, a mix that avoids power rationing while maintaining reasonable prices, achieves the targets set out in the Paris Agreement, helps to develop alternative energy sources, and gradually reduces our reliance on nuclear power.
This is a very serious issue that, as Taiwan citizens, we need to address pragmatically, and tackle together. We should never ignore or misjudge it.
VII. Conclusion
Today we're here to celebrate the founding of the Republic of China, the first democratic republic in Asia, now entering its 105th year. As we look back, there have been many gains and losses, happiness and sorrow, numerous trials, but also many highlights. Over the past seven-plus years we have actively promoted reforms in domestic affairs, foreign affairs, national defense, public finance, education, the economy, transportation and communication, health and sanitation, culture, technology, environmental protection, maritime security, cross-strait affairs, agriculture, the financial sector, and clean government—all of which have shown improvement. We have also strengthened democracy, human rights and the rule of law. Having received due recognition by the international community, Taiwan has indeed made progress, and can fulfill its role as "a beacon of democracy in the ethnic Chinese world."
Our efforts have allowed the Republic of China to make progress while ensuring stability. Looking ahead, Taiwan still faces formidable challenges. But as long as the new administration embraces the right policy directions and grasps the key to resolving problems, and the people stand united to work hand-in-hand, we will assuredly build a peaceful and prosperous future for the Republic of China, and a better life for future generations.
Thank you very much!