Taiwan presidential frontrunner blasts China over Foxconn probe

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Taiwan’s leading presidential candidate has blasted China over a probe of Apple supplier Foxconn, accusing Beijing of unfairly targeting the Taiwanese company ahead of an election early next year.

“China must not demand Taiwanese enterprises take sides,” said vice-president Lai Ching-te, the candidate from the ruling Democratic Progressive party and frontrunner for the January polls, accusing Beijing of pressuring Taiwanese companies “every time an election nears or [ordering] them to support certain candidates”.

Such tactics “hurt everyone”, he added at a campaign event on Tuesday. “If they [Foxconn] are hit without their own fault, they will only lose confidence in China,” he said. “Once they start being afraid, they will gradually move to other countries and set up their production bases.”

“That is a loss for China, too,” said Lai.

The Global Times, the Chinese state-owned nationalist tabloid, reported on Sunday that Foxconn subsidiaries in several Chinese provinces were being investigated for tax and land use issues. Foxconn has said it will co-operate with the investigation.

Taiwan was for many years one of the largest sources of foreign direct investment in China after Taipei lifted a ban on such activity 30 years ago.

Although new Taiwanese investment in China peaked 10 years ago, Taiwan-owned companies such as Foxconn, the world’s largest contract electronics manufacturer, rank among the country’s largest private exporters and employers.

Beijing has denounced Lai as a separatist, and he has historically been aligned with a more pro-independence wing of the DPP, but he has pledged to maintain incumbent president Tsai-Ing-wen’s policy of preserving the status quo across the Taiwan Strait.

Beijing claims Taiwan as part of its territory and has threatened to seize it by force if Taipei refuses to submit to its sovereignty.

Chinese authorities have in the past also pressured local subsidiaries of Taiwanese companies at politically sensitive times, and have repeatedly urged Taiwanese companies to support peaceful ties.

Foxconn’s billionaire founder Terry Gou is also vying for the presidency as one of three opposition candidates. He quit the Foxconn board last month after launching his campaign but he still holds a 12.5 per cent stake in the company.

Gou has not commented on the probe, and his campaign office did not respond to requests for comment.

The news of the Foxconn probe prompted unusual unity between Taiwan’s ruling party and its political opposition, with Ko Wen-je, candidate for the small Taiwan People’s party, also attacking China’s move.

“China calls itself a great power. No matter if it is towards Foxconn or others, they should explain [the investigation],” Ko said at a meeting with foreign journalists on Tuesday.

Ko, who is neck and neck in the polls with the candidate of the Kuomintang, the largest opposition party, has mostly campaigned on criticism of the government in Taipei, and advocates for a resumption of dialogue with China, which Beijing cut off after Tsai came to power in 2016.

Lai called on China to “take good care of and cherish” Taiwanese companies, which he said had helped boost China’s economy, develop its industry and stabilised its society by creating large numbers of jobs.

“Taiwanese companies have made a big contribution to China,” he said. “This is like the water benefiting the fish and the fish benefiting the water; it is a win-win situation.”