Taiwan's New President: Priorities and Challenges

Abstract

On 20 May 2024, William Lai was inaugurated as President of Taiwan. Faced with a divided legislature and political polarisation, acute pressure from China, and an uncertain international arena, he has pledged to continue the policies of his popular predecessor, President Tsai Ing-wen, in managing domestic social and economic policy as well as cross-Strait and foreign relations. Domestically, key issues for Lai to tackle include stagnant wages, rising housing costs, and a shrinking and aging population. While his proposed policies in these areas may gain traction, more contentious are his plans to phase out nuclear energy in Taiwan. In cross-Strait relations, Lai has promised to safeguard the status quo - that is, to maintain Taiwan's de facto sovereignty. He plans to strengthen Taiwan's deterrence capabilities and follow a pragmatic and principled approach that refuses Beijing's "one country, two systems" paradigm while expressing openness to cooperation between equals with China. In foreign policy, Lai's goal will be to deepen and broaden Taiwan's strategic relationships with democratic partners and further entrench the country's economy in international markets. Particular focus will be on maintaining Taiwan's leading position in the semiconductor industry. To achieve these goals, Lai will have to overcome numerous difficulties: a divided government and an increasingly polarised political landscape, demanding domestic social and economic challenges, continuing and potentially increasing pressure from China, and an international arena in flux.