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2020-12-10
President Tsai delivers address at Hudson Institute year-end celebration

President Tsai Ing-wen was invited by the Hudson Institute, a think tank based in Washington, DC, to deliver remarks at 8:00 a.m. this morning (December 10 local time; December 9, 7:00 p.m. US EST) at their virtual year-end celebration.

In her pre-recorded address, President Tsai said that Taiwan now stands on stronger footing after a year filled with challenges and opportunities. She said that the actions we have taken to strengthen our democracy, enhance our defense capabilities, and provide for greater economic security are aimed at better securing our future. President Tsai also emphasized that Taiwan is a powerful example of freedom, democracy, and free markets, which holds great significance for the Indo-Pacific region, and that she is fully committed to continuing progress in this direction.

A transcript of the president's remarks follows:

Dear friends, it is an honor to be speaking to the Hudson Institute's year-end celebration. This has been an extraordinary year – humanity has been faced with monumental challenges and incredible difficulties. But throughout it all, our faith in our future, in better days ahead, in the underlying goodness of our societies, this has never wavered. I know that we will emerge from the end of the tunnel stronger than before.

I want to thank President Weinstein, Mr. Walters, and your colleagues for holding this virtual gala. Hudson's dedication to advancing freedom, security, and prosperity both at home and abroad is well recognized and appreciated.

I am grateful that Hudson hosted me in August together with the Center for American Progress. You also welcomed Vice President William Lai during his visit to Washington, DC in February. Both of us appreciated the opportunities to exchange views on the regional situation that we face.

History has a tendency of repeating itself. It is becoming increasingly clear that today, the world is once again being faced with fundamental questions of freedom or authoritarianism. As we look at Hong Kong, we see what was one of Asia's most free and prosperous cities descend into fear, anxiety, and instability.

In the South China Sea, what was once an unfettered region critical to international maritime traffic has become highly militarized. In places such as Xinjiang, growing religious oppression has led to serious international concern. All of this is leading further and further away from the 21st century so many of us had once envisioned.

We are also watching with alarm the increasing provocation from across the Taiwan Strait. PLA fighter jets and naval ships now cross the median line of the strait with regularity, raising the risk of accidents and miscalculations.

The PRC has worked to shut the 23 million people of Taiwan out of international organizations, despite our legitimate requests to be included on matters of health, aviation safety, international police cooperation, climate change, and more. They are also engaged in disinformation and malign influence campaigns that are designed to cast doubt on our institutions and test weaknesses in our democracy.

I want to be clear: We do not desire this sort of cross-strait relationship. What we seek is constructive cross-strait dialogue, in order to peacefully address differences of opinion and perspective without the need for preconditions.

We see a necessity for both sides to find a way to co-exist peacefully, based on mutual respect, goodwill, and understanding. This has been the basis of my cross-strait policy, as it is a position that best serves the interests of peace and stability in the region.

While the 23 million people of Taiwan do not want to live in a state of permanent antagonism, we are also determined to safeguard our freedoms and way of life. We have made it a priority to strengthen our most valuable asset, that is democracy. We have implemented responsible ways to tackle disinformation through openness and transparency.

New legislation was passed to respond to PRC malign influence in our politics. Together with the U.S. and other international partners, we are also engaged on issues ranging from media literacy to accountable governance. These actions signal to all across the region about the resiliency of our democratic processes.

We have taken further actions to enshrine our principles of religious freedom and respect for human rights. We have inaugurated regional conferences on religious freedom, inviting faith leaders from around the region to participate.

Earlier this year, we also established our first-ever National Human Rights Commission to better monitor, secure, and strengthen human rights protections within Taiwan.

All of these actions are in line with our desire for Taiwan to shine brightly as a light of freedom in the region.

Taiwan is determined to take a different path forward. In order to do so, we must also be able to deter military adventurism and defend ourselves in the face of growing military tensions.

Over the past four years, I have acted on my commitments to increase our defense budget, erasing years of painful cutbacks. We expect that by next year, our regular defense spending will reach $14.9 billion US dollars, accounting for more than 2.2% of our GDP. I am determined to see this trend continue.

But more important than this, is to ensure that we are making investments in the right equipment and training. I appreciate the U.S. has made available new fighter jets, as well as new asymmetric capabilities, in line with our requests.

We are also devoting greater focus towards building up domestic defense industries. The security relationship is a highlight of our relationship, and I look forward to further discussions about our common defense picture with the U.S.

Another issue that is vital for us is our economy. As former Japanese Prime Minister Abe spoke about at this event seven years ago, few things are more essential than "restoring the economy."

For a long time, Taiwan's economy has remained stagnant. Wages failed to grow, and our global competitiveness continued to slip. As a consequence of this, talent and capital gradually left our shores for better opportunities abroad. Our trade became increasingly dependent on actors that may not have our best interests at heart.

I am pleased to say that this is no longer the case. As a result of the economic and regulatory reforms we have put into place, we have regained our leadership position amongst the Four Asian Tigers. We have continued to maintain positive economic momentum, despite the global downturn.

Meanwhile, our cutting-edge industries have become crucial to global supply chains, and we are welcoming record-numbers of inbound investment. As I have said in the past: "Economic security is national security." Today, we are better prepared than ever to respond to global challenges.

Taiwan continues to seek greater partnerships with other free-market economies around the world. Last month, we held our first Economic Prosperity Partnership Dialogue with the U.S., sharing ways we can enhance cooperation on supply chain security, 5G technologies, and global health.

Both sides will also move towards formalizing a new agreement on science and technology. But we believe that this relationship still has room to grow. As one article from Hudson states: "this is the right moment for a U.S.-Taiwan trade agreement." I could not have said it better myself, and we hope to engage in further discussions in this regard.

As we look back at a year full of challenges and opportunities, I am confident that Taiwan now stands on stronger footing. The actions we have taken to strengthen our democracy, to enhance our defense capabilities, and to provide for greater economic security – the purpose of this, is to better secure our future. Taiwan is an indispensable example of freedom, democracy, and free markets. This holds profound significance for the entire Indo-Pacific region, and I am determined to see this continue.

I have consistently believed that as President, my most sacred duty is to ensure that our next generation maintains their right to choose their own futures. Nothing can be more important.

And thanks to our friends in Congress, across different U.S. administrations, and here at Hudson, we know that we do not stand alone in this purpose. As we look around the globe, we find more and more recognition that our future is also related to the future of the free world – a world we all wish to see in the 21st century and beyond.

I wish to thank everyone for the honor of joining you tonight. The road to freedom and democracy is long and never easy. But it is one that is always worth taking. Thank you.

The Hudson Institute's virtual year-end celebration commenced at 6:30 p.m. on December 9 (US EST; 7:30 a.m., December 10 local time) and was focused on significant challenges the US and their allies face, and their responses. It was hosted by Hudson Institute Chief Operating Officer John Walters, with President and Chief Executive Officer Kenneth Weinstein introducing President Tsai. Other participants included Israeli Prime Minister Benjamin Netanyahu, US Senator Tom Cotton, US Congressman Seth Moulton and Congressional Chair of the House Republican Conference Liz Cheney.

The Hudson Institute is a key think tank based in Washington, DC. Its year-end celebration regularly hosts renowned political figures such as US Secretary of State Mike Pompeo, who attended last year's event and gave a notable speech entitled "The China Challenge." Previous guests have included former Japanese Prime Minister Shinzo Abe, US Vice President Mike Pence and Israeli Prime Minister Netanyahu, indicating the significance of this event.

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There is a high degree of international consensus that peace and stability across the Taiwan Strait are indispensable elements in global security and prosperity. Facing military threats from China, Taiwan proposed the Four Pillars of Peace action plan. First, we are actively implementing military reforms, enhancing whole-of-society defense resilience, and working to increase our defense budget to more than 3 percent of GDP. Second, we are strengthening our economic resilience. As Taiwan’s economy must keep advancing, we can no longer put all our eggs in one basket. We are taking action to remain firmly rooted in Taiwan while expanding our global presence and marketing worldwide. In these efforts, we are already seeing results. Third, we are standing side-by-side with other democratic countries to demonstrate the strength of deterrence and achieve our goal of peace through strength. And fourth, Taiwan is willing, under the principles of parity and dignity, to conduct exchanges and cooperate with China towards achieving peace and stability in the Taiwan Strait. This April 10 marked the 46th anniversary of the enactment of the Taiwan Relations Act. We thank the US government for continuing its arms sales to Taiwan over the years, supporting Taiwan’s efforts to enhance its national defense capabilities and jointly maintaining peace and stability in the Indo-Pacific region. We look forward to Taiwan and the US continuing to strengthen collaboration on the development of both our defense industries as well as the building of non-red supply chains. This will yield even more results and further deepen our economic and trade partnership. The US is now the main destination for outbound investment from Taiwan. Moving forward, we will promote our “Taiwan plus one” policy, that is, new arrangements for Taiwan plus the US. And our government will form a “Taiwan investment in the US team” to expand investment. We hope this will bring Taiwan-US economic and trade cooperation even closer and, through mutually beneficial assistance, allow us to generate development that benefits both our sides while reducing our trade deficit. In closing, thank you once again for visiting Taiwan. We hope your trip is fruitful and leaves you with a deep impression of Taiwan. We also hope that going forward you continue supporting Taiwan and advancing even greater development for Taiwan-US ties.  Chair Flournoy then delivered remarks, first thanking President Lai for making time to receive their delegation. Referring to President Lai’s earlier remarks, she said that it is quite an impressive group, as past members of this program have gone on to become members of the US Congress, leading government experts, and leaders in the think-tank world and in the private sector. 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President Lai delivers remarks on US tariff policy response
On April 6, President Lai Ching-te delivered recorded remarks regarding the impact of the 32 percent tariff that the United States government recently imposed on imports from Taiwan in the name of reciprocity. In his remarks, President Lai explained that the government will adopt five response strategies, including making every effort to improve reciprocal tariff rates through negotiations, adopting a support plan for affected domestic industries, adopting medium- and long-term economic development plans, forming new “Taiwan plus the US” arrangements, and launching industry listening tours. The president emphasized that as we face this latest challenge, the government and civil society will work hand in hand, and expressed hope that all parties, both ruling and opposition, will support the measures that the Executive Yuan will take to open up a broader path for Taiwan’s economy. A translation of President Lai’s remarks follows: My fellow citizens, good evening. The US government recently announced higher tariffs on countries around the world in the name of reciprocity, including imposing a 32 percent tariff on imports from Taiwan. This is bound to have a major impact on our nation. Various countries have already responded, and some have even adopted retaliatory measures. Tremendous changes in the global economy are expected. Taiwan is an export-led economy, and in facing future challenges there will inevitably be difficulties, so we must proceed carefully to turn danger into safety. During this time, I want to express gratitude to all sectors of society for providing valuable opinions, which the government regards highly, and will use as a reference to make policy decisions.  However, if we calmly and carefully analyze Taiwan’s trade with the US, we find that last year Taiwan’s exports to the US were valued at US$111.4 billion, accounting for 23.4 percent of total export value, with the other 75-plus percent of products sold worldwide to countries other than the US. Of products sold to the US, competitive ICT products and electronic components accounted for 65.4 percent. This shows that Taiwan’s economy does still have considerable resilience. As long as our response strategies are appropriate, and the public and private sectors join forces, we can reduce impacts. Please do not panic. To address the reciprocal tariffs by the US, Taiwan has no plans to adopt retaliatory tariffs. There will be no change in corporate investment commitments to the US, as long as they are consistent with national interests. But we must ensure the US clearly understands Taiwan’s contributions to US economic development. More importantly, we must actively seek to understand changes in the global economic situation, strengthen Taiwan-US industry cooperation, elevate the status of Taiwan industries in global supply chains, and with safeguarding the continued development of Taiwan’s economy as our goal, adopt the following five strategies to respond. Strategy one: Make every effort to improve reciprocal tariff rates through negotiations using the following five methods:  1. Taiwan has already formed a negotiation team led by Vice Premier Cheng Li-chiun (鄭麗君). The team includes members from the National Security Council, the Office of Trade Negotiations, and relevant Executive Yuan ministries and agencies, as well as academia and industry. Like the US-Mexico-Canada free trade agreement, negotiations on tariffs can start from Taiwan-US bilateral zero-tariff treatment. 2. To expand purchases from the US and thereby reduce the trade deficit, the Executive Yuan has already completed an inventory regarding large-scale procurement plans for agricultural, industrial, petroleum, and natural gas products, and the Ministry of National Defense has also proposed a military procurement list. All procurement plans will be actively pursued. 3. Expand investments in the US. Taiwan’s cumulative investment in the US already exceeds US$100 billion, creating approximately 400,000 jobs. In the future, in addition to increased investment in the US by Taiwan Semiconductor Manufacturing Company, other industries such as electronics, ICT, petrochemicals, and natural gas can all increase their US investments, deepening Taiwan-US industry cooperation. Taiwan’s government has helped form a “Taiwan investment in the US” team, and hopes that the US will reciprocate by forming a “US investment in Taiwan” team to bring about closer Taiwan-US trade cooperation, jointly creating a future economic golden age.  4. We must eliminate non-tariff barriers to trade. Non-tariff barriers are an indicator by which the US assesses whether a trading partner is trading fairly with the US. Therefore, we will proactively resolve longstanding non-tariff barriers so that negotiations can proceed more smoothly. 5. We must resolve two issues that have been matters of longstanding concern to the US. One regards high-tech export controls, and the other regards illegal transshipment of dumped goods, otherwise referred to as “origin washing.” Strategy two: We must adopt a plan for supporting our industries. For industries that will be affected by the tariffs, and especially traditional industries as well as micro-, small-, and medium-sized enterprises, we will provide timely and needed support and assistance. Premier Cho Jung-tai (卓榮泰) and his administrative team recently announced a package of 20 specific measures designed to address nine areas. Moving forward, the support we provide to different industries will depend on how they are affected by the tariffs, will take into account the particular features of each industry, and will help each industry innovate, upgrade, and transform. Strategy three: We must adopt medium- and long-term economic development plans. At this point in time, our government must simultaneously adopt new strategies for economic and industrial development. This is also the fundamental path to solutions for future economic challenges. The government will proactively cooperate with friends and allies, develop a diverse range of markets, and achieve closer integration of entities in the upper, middle, and lower reaches of industrial supply chains. This course of action will make Taiwan’s industrial ecosystem more complete, and will help Taiwanese industries upgrade and transform. We must also make good use of the competitive advantages we possess in such areas as semiconductor manufacturing, integrated chip design, ICT, and smart manufacturing to build Taiwan into an AI island, and promote relevant applications for food, clothing, housing, and transportation, as well as military, security and surveillance, next-generation communications, and the medical and health and wellness industries as we advance toward a smarter, more sustainable, and more prosperous new Taiwan. Strategy four: “Taiwan plus one,” i.e., new “Taiwan plus the US” arrangements: While staying firmly rooted in Taiwan, our enterprises are expanding their global presence and marketing worldwide. This has been our national economic development strategy, and the most important aspect is maintaining a solid base here in Taiwan. We absolutely must maintain a solid footing, and cannot allow the present strife to cause us to waver. Therefore, our government will incentivize investments, carry out deregulation, and continue to improve Taiwan’s investment climate by actively resolving problems involving access to water, electricity, land, human resources, and professional talent. This will enable corporations to stay in Taiwan and continue investing here. In addition, we must also help the overseas manufacturing facilities of offshore Taiwanese businesses to make necessary adjustments to support our “Taiwan plus one” policy, in that our national economic development strategy will be adjusted as follows: to stay firmly rooted in Taiwan while expanding our global presence, strengthening US ties, and marketing worldwide. We intend to make use of the new state of supply chains to strengthen cooperation between Taiwanese and US industries, and gain further access to US markets. Strategy five: Launch industry listening tours: All industrial firms, regardless of sector or size, will be affected to some degree once the US reciprocal tariffs go into effect. The administrative teams led by myself and Premier Cho will hear out industry concerns so that we can quickly resolve problems and make sure policies meet actual needs. My fellow citizens, over the past half-century and more, Taiwan has been through two energy crises, the Asian financial crisis, the global financial crisis, and pandemics. We have been able to not only withstand one test after another, but even turn crises into opportunities. The Taiwanese economy has emerged from these crises stronger and more resilient than ever. As we face this latest challenge, the government and civil society will work hand in hand, and I hope that all parties in the legislature, both ruling and opposition, will support the measures that the Executive Yuan will take to open up a broader path for Taiwan’s economy. Let us join together and give it our all. Thank you.
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