A Unified Korea, a Vulnerable Taiwan

In early October, Secretary of State Mike Pompeo met with North Korea’s leader Kim Jong-un for nearly four hours and announced the next steps for a second summit between Kim and President Donald Trump. The meeting built on discussions between Trump and Kim at their first summit in Singapore on June 12. On that same day, the American Institute in Taiwan concluded a decades-long process by unveiling its new building with a ceremony that was the most public affirmation of unofficial U.S.-Taiwan relations to date. However, the building’s opening was eclipsed by the Trump-Kim summit in Singapore.

Singapore was also the site where Taiwan’s then president Ma Ying-jeou and the People’s Republic of China (PRC) president Xi Jinping met in 2015. Over the three years since the summit between Xi and Ma, relations between Taiwan and China have deteriorated. On the Korean Peninsula, however, President Moon Jae-in of the Republic of Korea (ROK) has a rosy outlook on the future of relations with the Democratic People’s Republic of Korea (DPRK). A resolution of the conflict between North and South Korea still seems unlikely, but the recent inter-Korean dialogue and positive momentum on the peninsula have breathed new life into hopes for reunification. This raises questions about how reunification would affect the region broadly, and specifically what implications it would have for cross-strait relations between Taiwan and the PRC.

This commentary briefly compares the history of the two frozen conflicts and then explores how a potential reunification of the Korean Peninsula could affect Taiwan’s national security and economy.

Two Frozen Conflicts

ROK-DPRK relations and ROC-PRC relations are both frozen conflicts born from the Cold War. Taiwan and South Korea are like siblings—both were colonized by Japan, both have historic ties to China, and both are partners of the United States who have undergone radical economic growth and democratization in the last 30 years. Indeed, neither South Korea nor Taiwan could exist as it does today without U.S. intervention following the end of World War II. However, their counterparts, the PRC and DPRK, have not followed similar paths. North Korea is one of the least-developed countries in the world. Any modernization has come in spurts, generally to the benefit of elites in Pyongyang alone. China, meanwhile, is the second-largest economy in the world and has improved the quality of life for its citizens across the country (though not equally). China is also poised to overtake the United States economically and technologically in the coming years.

Cross-strait relations and inter-Korean relations face very different challenges in their respective levels of engagement and power imbalances. Taiwan and the PRC began opening relations in 1993, and the two sides have signed a series of agreements on travel, trade, people-to-people ties, and engagement between government authorities. Currently, cross-strait activities have chilled, but they have not completely come to a standstill. North and South Korea, meanwhile, have had three historic head-of-state meetings, family reunions, and cooperation during the 2018 Pyeongchang Olympics. Despite such progress, however, travel between the North and the South is still prohibited, trade has dropped dramatically, the exchange of information between family members is not possible, and the Demilitarized Zone (DMZ) remains one of the most heavily militarized borders in the world.

With full acknowledgment of the differences between inter-Korean and cross-strait relations, the compelling parallels merit a comparison of the two cases. One underlying theme is unification; although what that means to each country is unique. In a case of strange bedfellows, Taiwan and the DPRK are aligned in that unification poses a great risk of loss of autonomy or regime survival, whereas the ROK and the PRC have a relatively low risk of losing their autonomy or undergoing regime change in the event of unification.

Politically, unification is enshrined in the constitutions of both the North and South Korean governments. But whether each side has the political will to actually achieve unification, and what that would look like, remains unclear despite President Moon’s eagerness to make peace with the North. For Taiwan, unification was the dream of the former authoritarian ruler, Chiang Kai-shek, and his Kuomintang party at the outset of their exile, but now unification is favored by only 2% of the population. The PRC, meanwhile, has made territorial integrity a central tenet of its national interests, and patriots dutifully fight any offense that suggests that Taiwan is not a part of China. Not even a Gap t-shirt will go unnoticed.

The frozen cross-strait and inter-Korean conflicts are often analyzed as if they are two completely parallel but independent political dramas. The reality is that they have both been heavily influenced by U.S. foreign policy in Asia and are intertwined. Whereas many analysts have examined how the reunification of the Korean Peninsula would affect China, Taiwan is rarely included in such analysis. Given the current dynamism of inter-Korean relations and the high level of international interest, this analysis only focuses on how changes in the DPRK-ROK relationship could affect cross-strait relations. While cross-strait relations do have implications for inter-Korean relations, there is little interest on the peninsula in considering Taiwan in its foreign policy strategy.

Peace on the Korean Peninsula Brings Dangers and Opportunities for Taiwan

In the military dimension, cross-strait relations could be affected by a peace treaty between the DPRK and the ROK, as it almost certainly would entail a decreased U.S. military presence in the Indo-Pacific. At the Trump-Kim summit in June, President Trump promised to halt joint military exercises with South Korea. During the subsequent Moon-Kim summit in September 2018, the two leaders declared an “era with no war,” to include a cessation of military drills by the countries aimed at one another by November 1.

How the latter pledge will affect U.S. and UN forces is unclear. Regardless, these statements signal a change that could lessen the region-wide impact of deterrence that the U.S. troop presence in South Korea provides. ROK-DPRK unification could also include actual demilitarization of the DMZ and, depending on the terms, an open border. A true DMZ could mean the loss of U.S. forces at the joint command and would translate into fewer resources for deterrence against PRC aggression in the region. A peace agreement or unification could reduce the DMZ to a single UN observation office, or remove UN observers altogether, which could weaken international attention to developments on the peninsula. In short, there would be fewer checks on the PRC’s military activities in Korea.

If U.S. troops on the Korean Peninsula are severely reduced or removed altogether, then Taiwan’s military will need reforms in terms of both hardware and human capital. In 2017, President Tsai Ing-wen announced that Taiwan’s military spending will increase by 20% by 2025, with a focus on capabilities such as submarine, unmanned aircraft, and missile defense capabilities. Taiwan may also need to increase its naval forces or coast guard activities to counter maritime aggression. It recently switched from a conscription force to a voluntary military service, but people in Taiwan currently view the military with derision. The death of a military trainee in 2013 sparked massive protests, and there is a general distrust among young people toward the armed forces. Taiwan’s military lacks the general respect and attractive benefits for service members offered in the United States. Attracting and retaining talent will require increasing the military’s prestige among citizens, especially young people.

The easiest way to increase the size of Taiwan’s armed forces would be to include more women. There is a great gender imbalance in the military, which was only 14% women as of 2017. Taiwan could learn much from Israel, a similar small power besieged by larger aggressors, whose military requires all citizens, regardless of gender, to serve. A return to conscription would be deeply unpopular, but providing more benefits to young, healthy people or technical professionals, especially women, would improve morale while enhancing military preparedness in the event of aggression from the PRC. Benefits could include measures as simple as saving plans with higher interest rates, subsidized housing, tuition funding, or preference to move into civil service.

If the two Koreas unite or sign a peace treaty, Beijing will use the situation to its advantage, lauding the treaty as an example of why the “two Chinas” should unite as well. The PRC can be expected to direct stronger rhetoric and misinformation toward its own population as well as to people in Taiwan. Taiwan already has strong anti-propaganda agencies and news literacy programs, but to counteract intensified propaganda or “information warfare,” it would be critical for the country to significantly prioritize and ramp up public awareness campaigns in the lead-up to any sort of unification scenario on the Korean Peninsula. Taiwan would do well to copy Sweden’s example and create an official guidebook for citizens on how to prepare for and respond to crisis and conflict in the event that the PRC were to take unilateral action to unify with Taiwan.

It will be important for Taiwan to prevent itself from being shutout of a unified Korean Peninsula or having its international space further constrained after a removal or drawdown of U.S. forces. To prevent a shutout, Taiwan must cultivate strong ties to the United States and regional partners, especially the two Koreas. Beijing may try to diplomatically isolate the island by asking a new, unified Korea to reaffirm its commitment to the one-China principle. North Korea will probably have no issue with this, but Taiwan could leverage its relations with South Korea (and ask for support from the United States) to prevent a complete capitulation on the issue. A new security framework with the United States may be necessary to protect Taiwan’s ability to defend itself—something more substantive than the current Taiwan Relations Act—potentially through legislation that codifies the Six Assurances and Three Joint Communiqués into law. Congress is already boosting U.S.-Taiwan relations: the Taiwan Travel Act was passed in March 2018; Taiwan was explicitly mentioned in the National Defense Authorization Act for 2019; and a bill called the Taiwan Allies International Protection and Enhancement Initiative Act was introduced to deter current allies of Taiwan from switching allegiance to the PRC. Taiwan could also look to the Indo-Pacific region, especially India, for support. Strengthening ties with India, a country historically willing to stand up to China on a range of issues, such as their disputed border and refugees from Tibet, could benefit Taiwan going forward.

In the economic dimension, a unified Korea could present an amazing opportunity for Taiwan’s economy. North Korea could be the next Myanmar—a deeply underdeveloped, resource-rich country with a large untapped labor force. In fact, North Korea is reportedly already Taiwan’s fourth-largest trading partner. In 2017, Taiwan imported US$2.7 million in goods from the DPRK and exported US$45,000 to the country, down from US$12 million and US$560,000, respectively, in 2016 before sanctions were enacted. According to the Taiwan Ministry of Finance, exports to North Korea have dwindled over the last ten years, but imports remained robust until 2015, peaking in 2012 at US$42 million. If sanctions were lifted, and North Korea liberalized its economy, trade between the two countries could increase quickly and be worth billions.

That being said, a unified Korea could also pose a grave threat to Taiwan’s economy. If the PRC’s investment or other funding comes with stipulations that Taiwan be excluded from the market, or if North Korea and South Korea jointly decide not to involve it in the economic development of a united Korean Peninsula, then Taiwan could stand to lose millions. It is incumbent that Taiwan innovate its economy so that it can withstand such a potential loss or have an economy too strong to ignore—either by being embedded in supply chains or by offering what no other country can in the region, such as advancements in the Internet of Things, affordable renewable energy models, and advanced medical equipment and systems, among other options. Taiwan’s ability to respond to this economic threat is complicated by the fact that it follows international sanctions against the DPRK (as a courtesy rather than out of obligation, given that it is not a member of the United Nations). Whatever options it pursues, Taiwan will need to tread carefully so as to preserve its partnership with the United States.

Conclusion

Going forward, Taiwan would benefit from considering more carefully how inter-Korean relations could affect its national interests. This broad assessment of the potential impact across military, political, and economic dimensions shows that a unified Korea would most likely not change the PRC’s power vis-à-vis Taiwan. Yet it could change the regional dynamics in ways that leave the island exposed to dangers it had not previously considered. If Taiwan prepares adequately, it can adapt to a new Indo-Pacific region and continue to counter Chinese aggression. If, however, its long-term strategic planning fails to consider the ramifications of a unified Korean Peninsula for cross-strait relations, Taiwan may find itself in a vulnerable position.

Melissa Newcomb is a Project Manager with the Political and Security Affairs group at the National Bureau of Asian Research (NBR). The views expressed here are her own.