TAIPEI (The China Post) — The ongoing trade war between the United States- and China has become more and more fierce. The Huawei ban has had a profound and far-reaching impact globally. Foxconn Chairman Terry Gou, who is also a candidate in the Kuomintang (KMT) primary election, warned of a possible financial crisis during a media interview. In another interview on June 3, Gou wondered if the Tsai government is being too optimistic saying: “ I don’t know if President Tsai Ing-wen’s government is being stupid, naive, good or being bad intentionally.” Gou criticized the fact that President Tsai Ing-wen’s government has been using the amount of money that Taiwanese businessmen in mainland China have reinvested into Taiwan to trick and paralyze the public.
Gou cited Professor Graham Allison of Harvard University’s coined phrase of the Thucydides Trap in finding that over the past five hundred years of history, there have been sixteen instances where a rising power challenged to displace a ruling one, of which, twelve led to war. As of now, the power struggle is between China and the United States, which in Gou’s opinion may lead to the seventeenth case of power displacement. As such, Gou believes that the Tsai government should not be overly optimistic, nor favor one side, as this would set Taiwan on a path of danger
Gou said that foreign investment tells us everything, especially with regard to the devastation of the stock market in May. Gou expressed his concerns at the government’s ability to realize the impact of the trade war, which could lead to Taiwan’s self demise.
Gou noted that since the U.S.-China trade war began, the total import volume of the United States in the first quarter of this year has been similar to last year. However, the main difference between this year and last year is the source of import. Imports from China have decreased by 14 percent, while countries including South Korea, India and Mexico have seen an 18.4 percent, 15.2 percent, and 5.4 percent rise respectively.
Gou emphasized that the United States does want to resolve the trade deficit, but the deficit has not been reduced. Instead, the deficit has spread to other nations, which has led the United States to take harsher stances and has expanded the trade war to other countries. As of now, Gou remarked that neighboring nations including the Republic of Korea (ROK) currently enjoys the protection of the Free Trade Agreement (FTA), but Gou questioned whether Taiwan would be protected.
Gou believes that the government has not provided any early warnings, nor does it have any countermeasures. Gou suggests that the country immediately activates the National Security Council to avoid Taiwan being sacrificed during the trade war by these two nations. Taiwan, in the eyes of both nations, has immense strategic importance. Therefore, the government must seriously deal with a potential Taiwanese crisis. He hopes that the Taiwanese government isn’t being overly optimistic. If he were to be elected president, he would work very hard to renegotiate the supply chain with the United States and China, he said.