The island of Taiwan, formerly known as Formosa, was inhabited by Taiwanese aborigines before the 17th century, when Dutch and Spanish colonies opened the island to mass Han immigration. After a brief rule by the Kingdom of Tungning, the island was annexed by the Qing dynasty, the last dynasty of China. The Qing ceded Taiwan to Japan in 1895 after the Sino-Japanese War. While Taiwan was under Japanese rule, the Republic of China was established on the mainland in 1912 after the fall of the Qing dynasty. Following the Japanese surrender to the Allies in 1945, the ROC took control of Taiwan. However, the resumption of the Chinese Civil War led to the ROC's loss of the mainland to the Communists, and the flight of the ROC government to Taiwan in 1949. Although the ROC continued to claim to be the legitimate government of China, its effective jurisdiction has, since the loss of Hainan in 1950, been limited to Taiwan and its surrounding islands, with the main island making up 99% of its de facto territory. As a founding member of the United Nations, the ROC continued to represent China at the United Nations until 1971, when the PRC assumed China's seat, causing the ROC to lose its UN membership.
In the early 1960s, Taiwan entered a period of rapid economic growth and industrialization, creating a stable industrial economy. In the 1980s and early 1990s, it changed from a one-party military dictatorship dominated by the Kuomintang to a multi-party democracy with a semi-presidential system. Taiwan is the 22nd-largest economy in the world, and its high-tech industry plays a key role in the global economy. It is ranked highly in terms of freedom of the press, healthcare, public education, economic freedom, and human development. The country benefits from a highly skilled workforce and is among the most highly educated countries in the world with one of the highest percentages of its citizens holding a tertiary education degree.
The PRC has consistently claimed sovereignty over Taiwan and asserted the ROC is no longer in legitimate existence. Under its One-China Policy the PRC refused diplomatic relations with any country that recognizes the ROC. Today 20 countries maintain official ties with the ROC but many other states maintain unofficial ties through representative offices and institutions that function as de facto embassies and consulates. Although Taiwan is fully self-governing, most international organizations in which the PRC participates either refuse to grant membership to Taiwan or allow it to participate only as a non-state actor. Internally, the major division in politics is between the aspirations of eventual Chinese unification or Taiwanese independence, though both sides have moderated their positions to broaden their appeal. The PRC has threatened the use of military force in response to any formal declaration of independence by Taiwan or if PRC leaders decide that peaceful unification is no longer possible.
There are various names for the island of Taiwan in use today, derived from explorers or rulers by each particular period. The former name Formosa (福爾摩沙) dates from 1542, when Portuguese sailors sighted the main island of Taiwan and named it Ilha Formosa, which means "beautiful island". The name "Formosa" eventually "replaced all others in European literature" and was in common use in English in the early 20th century.
In the early 17th century, the Dutch East India Company established a commercial post at Fort Zeelandia (modern-day Anping, Tainan) on a coastal sandbar called "Tayouan", after their ethnonym for a nearby Taiwanese aboriginal tribe, written by the Dutch and Portuguese variously as Taiouwang, Tayowan, Teijoan, etc. This name was also adopted into the Chinese vernacular (in particular, Hokkien, as Pe̍h-ōe-jī: Tāi-oân/Tâi-oân) as the name of the sandbar and nearby area (Tainan). The modern word "Taiwan" is derived from this usage, which is seen in various forms (大員, 大圓, 大灣, 臺員, 臺圓 and 臺窩灣) in Chinese historical records. The area of modern-day Tainan was the first permanent settlement by Western colonists and Chinese immigrants, grew to be the most important trading centre, and served as the capital of the island until 1887. Use of the current Chinese name (臺灣) was formalized as early as 1684 with the establishment of Taiwan Prefecture. Through its rapid development, the entire Formosan mainland eventually became known as "Taiwan".
In his Daoyi Zhilüe (1349), Wang Dayuan used "Liuqiu" as a name for the island of Taiwan, or the part of it near to Penghu. Elsewhere, the name was used for the Ryukyu Islands in general or Okinawa, the largest of them; indeed the name Ryūkyū is the Japanese form of Liúqiú. The name also appears in the Book of Sui (636) and other early works, but scholars cannot agree on whether these references are to the Ryukyus, Taiwan or even Luzon.
The official name of the state is the "Republic of China"; it has also been known under various names throughout its existence. Shortly after the ROC's establishment in 1912, while it was still located on the Chinese mainland, the government used the short form "China" Zhōngguó (中國), to refer to itself, which derives from zhōng ("central" or "middle") and guó ("state, nation-state"), A term which also developed under the Zhou Dynasty in reference to its royal demesne and the name was then applied to the area around Luoyi (present-day Luoyang) during the Eastern Zhou and then to China's Central Plain before being used as an occasional synonym for the state under the Qingera. During the 1950s and 1960s, after the government had fled to Taiwan due to losing the Chinese Civil War, it was commonly referred to as "Nationalist China" (or "Free China") to differentiate it from "Communist China" (or "Red China"). It was a member of the United Nations representing "China" until 1971, when it lost its seat to the People's Republic of China. Over subsequent decades, the Republic of China has become commonly known as "Taiwan", after the island that comprises 99% of the territory under its control. In some contexts, especially official ones from the ROC government, the name is written as "Republic of China (Taiwan)", "Republic of China/Taiwan", or sometimes "Taiwan (ROC)." The Republic of China participates in most international forums and organizations under the name "Chinese Taipei" due to diplomatic pressure from the People's Republic of China. For instance, it is the name under which it has competed at the Olympic Games since 1984, and its name as an observer at the World Health Organization.
Taiwan was joined to the mainland in the Late Pleistocene, until sea levels rose about 10,000 years ago. Fragmentary human remains dated 20,000 to 30,000 years ago have been found on the island, as well as later artefacts of a Paleolithic culture.
Around 6,000 years ago, Taiwan was settled by farmers, most likely from mainland China. They are believed to be the ancestors of today's Taiwanese aborigines, whose languages belong to the Austronesian language family, but show much greater diversity than the rest of the family, which spans a huge area from Maritime Southeast Asia west to Madagascar and east as far as New Zealand, Hawaii and Easter Island. This has led linguists to propose Taiwan as the urheimat of the family, from which seafaring peoples dispersed across Southeast Asia and the Pacific and Indian Oceans.
Han Chinese fishermen began settling in the Penghu islands in the 13th century. Hostile tribes, and a lack of valuable trade products, meant that few outsiders visited the main island until the 16th century. By the 1700's visits to the coast by fishermen from Fujian, as well as Chinese and Japanese pirates, became more frequent.
The Dutch East India Company attempted to establish a trading outpost on the Penghu Islands (Pescadores) in 1622, but were militarily defeated and driven off by the Ming authorities.
In 1624, the company established a stronghold called Fort Zeelandia on the coastal islet of Tayouan, which is now part of the main island at Anping, Tainan. David Wright, a Scottish agent of the company who lived on the island in the 1650s, described the lowland areas of the island as being divided among 11 chiefdoms ranging in size from two settlements to 72. Some of these fell under Dutch control, while others remained independent. The Company began to import labourers from Fujian and Penghu (Pescadores), many of whom settled.
In 1626, the Spanish Empire landed on and occupied northern Taiwan, at the ports of Keelung and Tamsui, as a base to extend their trading. This colonial period lasted 16 years until 1642, when the last Spanish fortress fell to Dutch forces.
Following the fall of the Ming dynasty, Koxinga (Zheng Chenggong), a self-styled Ming loyalist, arrived on the island and captured Fort Zeelandia in 1662, expelling the Dutch Empire and military from the island. Koxinga established the Kingdom of Tungning (1662–1683), with his capital at Tainan. He and his heirs, Zheng Jing, who ruled from 1662 to 1682, and Zheng Keshuang, who ruled less than a year, continued to launch raids on the southeast coast of mainland China well into the Qing dynasty era.
In 1683, following the defeat of Koxinga's grandson by an armada led by Admiral Shi Lang of southern Fujian, the Qing dynasty formally annexed Taiwan, placing it under the jurisdiction of Fujian province. The Qing imperial government tried to reduce piracy and vagrancy in the area, issuing a series of edicts to manage immigration and respect aboriginal land rights. Immigrants mostly from southern Fujian continued to enter Taiwan. The border between taxpaying lands and "savage" lands shifted eastward, with some aborigines becoming sinicized while others retreated into the mountains. During this time, there were a number of conflicts between groups of Han Chinese from different regions of southern Fujian, particularly between those from Quanzhou and Zhangzhou, and between southern Fujian Chinese and aborigines.
Northern Taiwan and the Penghu Islands were the scene of subsidiary campaigns in the Sino-French War (August 1884 to April 1885). The French occupied Keelung on 1 October 1884, but were repulsed from Tamsui a few days later. The French won some tactical victories but were unable to exploit them, and the Keelung Campaign ended in stalemate. The Pescadores Campaign, beginning on 31 March 1885, was a French victory, but had no long-term consequences. The French evacuated both Keelung and the Penghu archipelago after the end of the war.
In 1887, the Qing upgraded the island's administration from Taiwan Prefecture of Fujian to Fujian-Taiwan-Province (福建臺灣省), the twentieth in the empire, with its capital at Taipei. This was accompanied by a modernization drive that included building China's first railroad.
As the Qing dynasty was defeated in the First Sino-Japanese War (1894–1895), Taiwan, along with Penghu and Liaodong Peninsula, were ceded in full sovereignty to the Empire of Japan by the Treaty of Shimonoseki. Inhabitants on Taiwan and Penghu wishing to remain Qing subjects were given a two-year grace period to sell their property and move to mainland China. Very few Taiwanese saw this as feasible. On 25 May 1895, a group of pro-Qing high officials proclaimed the Republic of Formosa to resist impending Japanese rule. Japanese forces entered the capital at Tainan and quelled this resistance on 21 October 1895. Guerrilla fighting continued periodically until about 1902 and ultimately took the lives of 14,000 Taiwanese, or 0.5% of the population. Several subsequent rebellions against the Japanese (the Beipu uprising of 1907, the Tapani incident of 1915, and the Musha incident of 1930) were all unsuccessful but demonstrated opposition to Japanese colonial rule.
Japanese colonial rule was instrumental in the industrialization of the island, extending the railroads and other transportation networks, building an extensive sanitation system, and establishing a formal education system. Japanese rule ended the practice of headhunting. During this period the human and natural resources of Taiwan were used to aid the development of Japan and the production of cash crops such as rice and sugar greatly increased. By 1939, Taiwan was the seventh greatest sugar producer in the world. Still, the Taiwanese and aborigines were classified as second- and third-class citizens. After suppressing Chinese guerrillas in the first decade of their rule, Japanese authorities engaged in a series of bloody campaigns against the mountain aboriginals, culminating in the Musha Incident of 1930. Intellectuals and laborers who participated in left-wing movements within Taiwan were also arrested and massacred (e.g. Tsiúnn Uī-Suí(蔣渭水), Masanosuke Watanabe (渡辺政之辅)).
Around 1935, the Japanese began an island-wide assimilation project to bind the island more firmly to the Japanese Empire and people were taught to see themselves as Japanese under the Kominka Movement, during which time Taiwanese culture and religion were outlawed and the citizens were encouraged to adopt Japanese surnames. The "South Strike Group" was based at the Taihoku Imperial University in Taipei. During World War II, tens of thousands of Taiwanese served in the Japanese military. For example, former ROC President Lee Teng-hui's elder brother served in the Japanese navy and was killed in action in the Philippines in February 1945. The Imperial Japanese Navy operated heavily out of Taiwanese ports. In October 1944, the Formosa Air Battle was fought between American carriers and Japanese forces based in Taiwan. Important Japanese military bases and industrial centres throughout Taiwan, like Kaohsiung, were targets of heavy American bombings. Also during this time, over 2,000 women were forced into sexual slavery for Imperial Japanese troops, now euphemistically called "comfort women."
In 1938, there were 309,000 Japanese settlers in Taiwan. After World War II, most of the Japanese were expelled and sent to Japan.
During Japanese rule of Taiwan, on 1 January 1912, the Republic of China was declared with Sun Yat-sen of the Kuomintang (the KMT or Nationalist Party) was proclaimed provisional president following the Xinhai Revolution, which itself began with the Wuchang Uprising on 10 October 1911, overthrowing the Qing Dynasty and ending over two thousand years of imperial rule in China. However, the presidency was later given to Yuan Shikai, a former Qing general who in 1915 proclaimed himself Emperor of China. In the face of popular condemnation and opposition from his own Beiyang Army, he was forced to abdicate and re-establish the republic.
Since its founding until 1949 it was based on mainland China. Central authority waxed and waned in response to warlordism (1915–28) after Yuan Shikai's death in 1916,, Japanese invasion (1937–45), and the Chinese Civil War (1927–49), with central authority strongest during the Nanjing Decade (1927–37), when most of China came under the control of the Kuomintang (KMT) under an authoritarian one-party state.
After the Surrender of Japan, on 25 October 1945, the US Navy ferried ROC troops to Taiwan in order to accept the formal surrender of Japanese military forces in Taipei on behalf of the Allied Powers, as part of General Order No. 1 for temporary military occupation. General Rikichi Andō, governor-general of Taiwan and commander-in-chief of all Japanese forces on the island, signed the receipt and handed it over to General Chen Yi of the ROC military to complete the official turnover. Chen Yi proclaimed that day to be "Taiwan Retrocession Day", but the Allies considered Taiwan and the Penghu Islands to be under military occupation and still under Japanese sovereignty until 1952, when the Treaty of San Francisco took effect. Although the 1943 Cairo Declaration had envisaged returning these territories to China, in the Treaty of San Francisco and Treaty of Taipei Japan has renounced all claim to them without specifying to what country they were to be surrendered. This introduced the problem of the legal status of Taiwan.
The ROC administration of Taiwan under Chen Yi was strained by increasing tensions between Taiwanese-born people and newly arrived mainlanders, which were compounded by economic woes, such as hyperinflation. Furthermore, cultural and linguistic conflicts between the two groups quickly led to the loss of popular support for the new government, while the mass movement led by the working committee of the Communist Party also aimed to bring down the Kuomintang government. The shooting of a civilian on 28 February 1947 triggered island-wide unrest, which was suppressed with military force in what is now called the February 28 Incident. Mainstream estimates of the number killed range from 18,000 to 30,000. Those killed were mainly members of the Taiwanese elite.
After the end of World War II, the Chinese Civil War resumed between the Chinese Nationalists (Kuomintang), led by Chiang Kai-shek, and the Communist Party of China, led by Mao Zedong. Throughout the months of 1949, a series of Chinese Communist offensives led to the capture of its capital Nanjing on 23 April and the subsequent defeat of the Nationalist army on the mainland, and the Communists founded the People's Republic of China on 1 October.
On 7 December 1949, after the loss of four capitals, Chiang evacuated his Nationalist government to Taiwan and made Taipei the temporary capital of the ROC (also called the "wartime capital" by Chiang Kai-shek). Some 2 million people, consisting mainly of soldiers, members of the ruling Kuomintang and intellectual and business elites, were evacuated from mainland China to Taiwan at that time, adding to the earlier population of approximately six million. In addition, the ROC government took to Taipei many national treasures and much of China's gold reserves and foreign currency reserves.
After losing most of the mainland, the Kuomintang held remaining control of Tibet, the portions of Qinghai, Xinjiang, and Yunnan provinces along with the Hainan Island until 1951 before the Communists subsequently captured both territories. From this point onwards, the Kuomintang's territory was reduced to Taiwan, Penghu, the portions of the Fujian province (Kinmen and Matsu Islands), and two major islands of Dongsha Islands and Nansha Islands. The Kuomintang continued to claim sovereignty over all "China", which it defined to include mainland China, Taiwan, Outer Mongolia and other areas. On mainland China, the victorious Communists claimed they ruled the sole and only China (which they claimed included Taiwan) and that the Republic of China no longer existed.
Martial law, declared on Taiwan in May 1949, continued to be in effect after the central government relocated to Taiwan. It was not repealed until 1987, and was used as a way to suppress the political opposition in the intervening years. During the White Terror, as the period is known, 140,000 people were imprisoned or executed for being perceived as anti-KMT or pro-Communist. Many citizens were arrested, tortured, imprisoned and executed for their real or perceived link to the Communists. Since these people were mainly from the intellectual and social elite, an entire generation of political and social leaders was decimated. In 1998 law was passed to create the "Compensation Foundation for Improper Verdicts" which oversaw compensation to White Terror victims and families. President Ma Ying-jeou made an official apology in 2008, expressing hope that there will never be a tragedy similar to White Terror.
Initially, the United States abandoned the KMT and expected that Taiwan would fall to the Communists. However, in 1950 the conflict between North Korea and South Korea, which had been ongoing since the Japanese withdrawal in 1945, escalated into full-blown war, and in the context of the Cold War, US President Harry S. Truman intervened again and dispatched the US Navy's 7th Fleet into the Taiwan Strait to prevent hostilities between Taiwan and mainland China. In the Treaty of San Francisco and the Treaty of Taipei, which came into force respectively on 28 April 1952 and 5 August 1952, Japan formally renounced all right, claim and title to Taiwan and Penghu, and renounced all treaties signed with China before 1942. Neither treaty specified to whom sovereignty over the islands should be transferred, because the United States and the United Kingdom disagreed on whether the ROC or the PRC was the legitimate government of China. Continuing conflict of the Chinese Civil War through the 1950s, and intervention by the United States notably resulted in legislation such as the Sino-American Mutual Defense Treaty and the Formosa Resolution of 1955.
As the Chinese Civil War continued without truce, the government built up military fortifications throughout Taiwan. Within this effort, KMT veterans built the now famous Central Cross-Island Highway through the Taroko Gorge in the 1950s. The two sides would continue to engage in sporadic military clashes with seldom publicized details well into the 1960s on the China coastal islands with an unknown number of night raids. During the Second Taiwan Strait Crisis in September 1958, Taiwan's landscape saw Nike-Hercules missile batteries added, with the formation of the 1st Missile Battalion Chinese Army that would not be deactivated until 1997. Newer generations of missile batteries have since replaced the Nike Hercules systems throughout the island.
During the 1960s and 1970s, the ROC maintained an authoritarian, single-party government while its economy became industrialized and technology oriented. This rapid economic growth, known as the Taiwan Miracle, was the result of a fiscal regime independent from mainland China and backed up, among others, by the support of US funds and demand for Taiwanese products. In the 1970s, Taiwan was economically the second fastest growing state in Asia after Japan. Taiwan, along with Hong Kong, South Korea and Singapore, became known as one of the Four Asian Tigers. Because of the Cold War, most Western nations and the United Nations regarded the ROC as the sole legitimate government of China until the 1970s. Later, especially after the termination of the Sino-American Mutual Defense Treaty, most nations switched diplomatic recognition to the PRC (see United Nations General Assembly Resolution 2758).
Up until the 1970s, the government was regarded by Western critics as undemocratic for upholding martial law, for severely repressing any political opposition and for controlling media. The KMT did not allow the creation of new parties and those that existed did not seriously compete with the KMT. Thus, competitive democratic elections did not exist. From the late 1970s to the 1990s, however, Taiwan went through reforms and social changes that transformed it from an authoritarian state to a democracy. In 1979, a pro-democracy protest known as the Kaohsiung Incident took place in Kaohsiung to celebrate Human Rights Day. Although the protest was rapidly crushed by the authorities, it is today considered as the main event that united Taiwan's opposition.
Chiang Ching-kuo, Chiang Kai-shek's son and successor as the president, began to liberalize the political system in the mid-1980s. In 1984, the younger Chiang selected Lee Teng-hui, a Taiwanese-born, US-educated technocrat, to be his vice-president. In 1986, the Democratic Progressive Party (DPP) was formed and inaugurated as the first opposition party in the ROC to counter the KMT. A year later, Chiang Ching-kuo lifted martial law on the main island of Taiwan (martial law was lifted on Penghu in 1979, Matsu island in 1992 and Kinmen island in 1993). With the advent of democratization, the issue of the political status of Taiwan gradually resurfaced as a controversial issue where, previously, the discussion of anything other than unification under the ROC was taboo.
After the death of Chiang Ching-kuo in January 1988, Lee Teng-hui succeeded him as president. Lee continued to democratize the government and decrease the concentration of government authority in the hands of mainland Chinese. Under Lee, Taiwan underwent a process of localization in which Taiwanese culture and history were promoted over a pan-China viewpoint in contrast to earlier KMT policies which had promoted a Chinese identity. Lee's reforms included printing banknotes from the Central Bank rather than the Provincial Bank of Taiwan, and streamlining the Taiwan Provincial Government with most of its functions transferred to the Executive Yuan. Under Lee, the original members of the Legislative Yuan and National Assembly(a former supreme legislative body defunct in 2005）, elected in 1947 to represent mainland Chinese constituencies and having held the seats without re-election for more than four decades, were forced to resign in 1991. The previously nominal representation in the Legislative Yuan was brought to an end, reflecting the reality that the ROC had no jurisdiction over mainland China, and vice versa. Restrictions on the use of Taiwanese Hokkien in the broadcast media and in schools were also lifted.
Democratic reforms continued in the 1990s, with Lee Teng-hui re-elected in 1996, in the first direct presidential election in the history of the ROC. During the later years of Lee's administration, he was involved in corruption controversies relating to government release of land and weapons purchase, although no legal proceedings commenced. In 1997,"To meet the requisites of the nation prior to national unification", the Additional Articles of the Constitution of the Republic of China was passed and then the former "constitution of five powers" turns to be more tripartite. In 2000, Chen Shui-bian of the Democratic Progressive Party was elected as the first non-Kuomintang (KMT) President and was re-elected to serve his second and last term since 2004. Polarized politics has emerged in Taiwan with the formation of the Pan-Blue Coalition of parties led by the KMT, favouring eventual Chinese reunification, and the Pan-Green Coalition of parties led by the DPP, favouring an eventual and official declaration of Taiwanese independence. In early 2006, President Chen Shui-bian remarked: “The National Unification Council will cease to function. No budget will be ear-marked for it and its personnel must return to their original posts...The National Unification Guidelines will cease to apply."
On 30 September 2007, the ruling DPP approved a resolution asserting a separate identity from China and called for the enactment of a new constitution for a "normal country". It also called for general use of "Taiwan" as the country's name, without abolishing its formal name, the Republic of China. The Chen administration also pushed for referendums on national defence and UN entry in the 2004 and 2008 elections, which failed due to voter turnout below the required legal threshold of 50% of all registered voters. The Chen administration was dogged by public concerns over reduced economic growth, legislative gridlock due to a pan-blue, opposition-controlled Legislative Yuan and corruption involving the First Family as well as government officials.
The KMT increased its majority in the Legislative Yuan in the January 2008 legislative elections, while its nominee Ma Ying-jeou went on to win the presidency in March of the same year, campaigning on a platform of increased economic growth and better ties with the PRC under a policy of "mutual nondenial". Ma took office on 20 May 2008, the same day that President Chen Shui-bian stepped down and was notified by prosecutors of possible corruption charges. Part of the rationale for campaigning for closer economic ties with the PRC stems from the strong economic growth China attained since joining the World Trade Organization. However, some analysts say that despite the election of Ma Ying-jeou, the diplomatic and military tensions with the PRC have not been reduced.
On 24 May 2017, the Constitutional Court ruled that current marriage laws are unconstitutional and that same-sex couples in the Taiwanese LGBT community should have the right to marry. The court has given the Legislative Yuan two years to adequately amend Taiwanese marriage laws. According to the court ruling, if amendments are not passed within two years, same-sex marriages will automatically become legal in Taiwan.
The total area of the current jurisdiction of the Republic of China is 36,193 km2 (13,974 sq mi), making it the world's 137th-largest country/dependency, smaller than Switzerland and larger than Belgium.
The island of Taiwan has an area of 35,883 km2 (13,855 sq mi), and lies some 180 kilometres (110 mi) from the southeastern coast of mainland China across the Taiwan Strait. The East China Sea lies to the north, the Philippine Sea to the east, the Bashi Channel of the Luzon Strait directly to the south, and the South China Sea to the southwest. Its shape is similar to a sweet potato, giving rise to the name sweet potato used by Taiwanese Hokkien speakers for people of Taiwanese descent.
The island is characterized by the contrast between the eastern two-thirds, consisting mostly of rugged mountains running in five ranges from the northern to the southern tip of the island, and the flat to gently rolling Chianan Plains in the west that are also home to most of Taiwan's population. Taiwan's highest point is Yu Shan (Jade Mountain) at 3,952 metres (12,966 ft), making Taiwan the world's fourth-highest island.
The Penghu Islands, 50 km (31.1 mi) west of the main island, have an area of 126.9 km2 (49.0 sq mi). More distant islands controlled by the Republic of China are the Kinmen, Wuchiu and Matsu Islands off the coast of Fujian, with a total area of 180.5 km2 (69.7 sq mi), and the Pratas Islands and Taiping Island in the South China Sea, with a total area of 2.9 km2 (1.1 sq mi) and no permanent inhabitants. The ROC government also claims the Senkaku Islands to the northeast, which are controlled by Japan.
Taiwan lies on the Tropic of Cancer, and its general climate is marine tropical. The northern and central regions are subtropical, whereas the south is tropical and the mountainous regions are temperate. The average rainfall is 2,600 millimetres (100 inches) per year for the island proper; the rainy season is concurrent with the onset of the summer East Asian Monsoon in May and June. The entire island experiences hot, humid weather from June through September. Typhoons are most common in July, August and September. During the winter (November to March), the northeast experiences steady rain, while the central and southern parts of the island are mostly sunny.
The island of Taiwan lies in a complex tectonic area between the Yangtze Plate to the west and north, the Okinawa Plate on the north-east, and the Philippine Mobile Belt on the east and south. The upper part of the crust on the island is primarily made up of a series of terranes, mostly old island arcs which have been forced together by the collision of the forerunners of the Eurasian Plate and the Philippine Sea Plate. These have been further uplifted as a result of the detachment of a portion of the Eurasian Plate as it was subducted beneath remnants of the Philippine Sea Plate, a process which left the crust under Taiwan more buoyant.
The east and south of Taiwan are a complex system of belts formed by, and part of the zone of, active collision between the North Luzon Trough portion of the Luzon Volcanic Arc and South China, where accreted portions of the Luzon Arc and Luzon forearc form the eastern Coastal Range and parallel inland Longitudinal Valley of Taiwan respectively.
The major seismic faults in Taiwan correspond to the various suture zones between the various terranes. These have produced major quakes throughout the history of the island. On 21 September 1999, a 7.3 quake known as the "921 earthquake" killed more than 2,400 people. The seismic hazard map for Taiwan by the USGS shows 9/10 of the island as the highest rating (most hazardous).
The political and legal statuses of Taiwan are contentious issues. The People's Republic of China (PRC) claims that the Republic of China government is illegitimate, referring to it as the "Taiwan Authority" even though current ROC territories have never been controlled by the PRC. The ROC has its own constitution, independently elected president and armed forces. It has not formally renounced its claim to the mainland, but ROC government publications have increasingly downplayed it.
Internationally, there is controversy on whether the ROC still exists as a state or a defunct state per international law due to the lack of wide diplomatic recognition. In a poll of Taiwanese aged 20 and older taken by TVBS in March 2009, a majority of 64% opted for the "status quo", while 19% favoured "independence" and 5% favoured "unification".
The political environment is complicated by the potential for military conflict should Taiwan declare de jure independence; it is the official PRC policy to use force to ensure unification if peaceful unification is no longer possible, as stated in its anti-secession law, and for this reason there are substantial military installations on the Fujian coast.
On 29 April 2005, Kuomintang Chairman Lien Chan travelled to Beijing and met with Communist Party of China (CPC) Secretary-General Hu Jintao, the first meeting between the leaders of the two parties since the end of the Chinese Civil War in 1949. On 11 February 2014, Mainland Affairs Council Head Wang Yu-chi travelled to Nanjing and met with Taiwan Affairs Office Head Zhang Zhijun, the first meeting between high-ranking officials from either side. Zhang paid a reciprocal visit to Taiwan and met Wang on 25 June 2014, making Zhang the first minister-level PRC official to ever visit Taiwan. On 7 November 2015, Ma Ying-jeou (in his capacity as Leader of Taiwan) and Xi Jinping (in his capacity as Leader of Mainland China) travelled to Singapore and met up, marking the highest-level exchange between the two sides since 1949.
The PRC supports a version of the One-China policy, which states that Taiwan and mainland China are both part of China, and that the PRC is the only legitimate government of China. It uses this policy to prevent the international recognition of the ROC as an independent sovereign state, meaning that Taiwan participates in international forums under the name "Chinese Taipei". With the emergence of the Taiwanese independence movement, the name "Taiwan" has been employed increasingly often on the island.
Before 1928, the foreign policy of Republican China was complicated by a lack of internal unity—competing centres of power all claimed legitimacy. This situation changed after the defeat of the Peiyang Government by the Kuomintang, which led to widespread diplomatic recognition of the Republic of China.
After the KMT's retreat to Taiwan, most countries, notably the countries in the Western Bloc, continued to maintain relations with the ROC. Due to diplomatic pressure, recognition gradually eroded and many countries switched recognition to the PRC in the 1970s. UN Resolution 2758 (25 October 1971) recognized the People's Republic of China as China's sole representative in the United Nations.
The PRC refuses to have diplomatic relations with any nation that recognizes the ROC, and requires all nations with which it has diplomatic relations to make a statement recognizing its claims to Taiwan. As a result, only 19 UN member states and the Holy See maintain official diplomatic relations with the Republic of China. The ROC maintains unofficial relations with most countries via de facto embassies and consulates called Taipei Economic and Cultural Representative Offices (TECRO), with branch offices called "Taipei Economic and Cultural Offices" (TECO). Both TECRO and TECO are "unofficial commercial entities" of the ROC in charge of maintaining diplomatic relations, providing consular services (i.e. visa applications), and serving the national interests of the ROC in other countries.
The United States remains one of the main allies of the country and, through the Taiwan Relations Act passed in 1979, has continued selling arms and providing military training to the Armed Forces. This situation continues to be an issue for the People's Republic of China which considers US involvement disruptive to the stability of the region. In January 2010, the Obama administration announced its intention to sell $6.4 billion worth of military hardware to Taiwan. As a consequence, the PRC threatened the US with economic sanctions and warned that their co-operation on international and regional issues could suffer.
The official position of the United States is that the PRC is expected to "use no force or threat[en] to use force against Taiwan" and the ROC is to "exercise prudence in managing all aspects of Cross-Strait relations." Both are to refrain from performing actions or espousing statements "that would unilaterally alter Taiwan's status."
On 16 December 2015, the Obama administration announced a deal to sell $1.83 billion worth of arms to the armed forces of the ROC. China's foreign ministry had expressed its disapproval for the sales and issued the US a "stern warning", saying it would hurt China–US relations.
The ROC was a founding member of the United Nations, and held the seat of China on the Security Council and other UN bodies until 1971, when it was expelled by Resolution 2758 and replaced in all UN organs with the PRC. Each year since 1992, the ROC has petitioned the UN for entry, but its applications have not made it past committee.
Due to its limited international recognition, the Republic of China is a member of the Unrepresented Nations and Peoples Organization, represented by a government-funded organization, the Taiwan Foundation for Democracy (TFD) under the name "Taiwan".
Also due to its One China policy, the PRC only participates in international organizations where the ROC is not recognized as a sovereign country. Most member states, including the United States, do not wish to discuss the issue of the ROC's political status for fear of souring diplomatic ties with the PRC. However, both the US and Japan publicly support the ROC's bid for membership in the World Health Organization as an observer. However, though the ROC sought to participate in the WHO since 1997, their efforts were blocked by the PRC until 2010, when they were invited as observers to attend the World Health Assembly, under the name "Chinese Taipei".
Due to PRC pressure, the ROC is forced to use the name "Chinese Taipei" in international events, such as the Olympic Games, where the PRC is also a party. The ROC is typically barred from using its national anthem and national flag in international events due to PRC pressure; ROC spectators attending events such as the Olympics are often barred from bringing ROC flags into venues. Taiwan also participates in the Asia-Pacific Economic Cooperation forum (since 1991) and the World Trade Organization (since 2002) under the name "Chinese Taipei". The ROC is able to participate as "China" in organizations that the PRC does not participate in, such as the World Organization of the Scout Movement.
Within Taiwan, opinions are polarized between those supporting unification, represented by the Pan-Blue Coalition of parties, and those supporting independence, represented by the Pan-Green Coalition.
The KMT, the largest Pan-Blue party, supports the status quo for the indefinite future with a stated ultimate goal of unification. However, it does not support unification in the short term with the PRC as such a prospect would be unacceptable to most of its members and the public. Ma Ying-jeou, chairman of the KMT and former president of the ROC, has set out democracy, economic development to a level near that of Taiwan, and equitable wealth distribution as the conditions that the PRC must fulfill for reunification to occur.
The Democratic Progressive Party, the largest Pan-Green party, officially seeks independence, but in practice also supports the status quo because its members and the public would not accept the risk of provoking the PRC.
On 2 September 2008, Mexican newspaper El Sol de México asked President Ma about his views on the subject of "two Chinas" and if there was a solution for the sovereignty issues between the two. The president replied that the relations are neither between two Chinas nor two states. It is a special relationship. Further, he stated that the sovereignty issues between the two cannot be resolved at present, but he quoted the "1992 Consensus", currently accepted by both the Kuomintang and the Communist Party of China, as a temporary measure until a solution becomes available.
On 27 September 2017, Taiwanese premier William Lai said that he was a “political worker who advocates Taiwan independence”, but that as Taiwan was an independent country called the Republic of China, it had no need to declare independence. The relationship with the PRC and the related issues of Taiwanese independence and Chinese unification continue to dominate politics.
The government of the Republic of China was founded on the Constitution of the ROC and its Three Principles of the People, which states that the ROC "shall be a democratic republic of the people, to be governed by the people and for the people." The government is divided into five branches (Yuan): the Executive Yuan (cabinet), the Legislative Yuan (Congress or Parliament), the Judicial Yuan, the Control Yuan (audit agency), and the Examination Yuan (civil service examination agency). The constitution was drafted before the fall of mainland China to the Communist Party of China. It was created by the KMT for the purpose of all of its claimed territory, including Taiwan, even though the Communist Party boycotted the drafting of the constitution. The constitution went into effect on 25 December 1947. The ROC remained under martial law from 1948 until 1987 and much of the constitution was not in effect. Political reforms beginning in the late 1970s and continuing through the early 1990s liberalized the country and transformed into a multiparty democracy. Since the lifting of martial law, the Republic of China has democratized and reformed, suspending constitutional components that were originally meant for the whole of China. This process of amendment continues. In 2000, the Democratic Progressive Party (DPP) won the presidency, ending KMT's continuous control of the government. In May 2005, a new National Assembly was elected to reduce the number of parliamentary seats and implement several constitutional reforms. These reforms have been passed; the National Assembly has essentially voted to abolish itself and transfer the power of constitutional reform to the popular ballot.
The head of state and commander-in-chief of the armed forces is the president, who is elected by popular vote for a maximum of 2 four-year terms on the same ticket as the vice-president. The president has authority over the Yuan. The president appoints the members of the Executive Yuan as his cabinet, including a premier, who is officially the President of the Executive Yuan; members are responsible for policy and administration.
The main legislative body is the unicameral Legislative Yuan with 113 seats. Seventy-three are elected by popular vote from single-member constituencies; thirty-four are elected based on the proportion of nationwide votes received by participating political parties in a separate party list ballot; and six are elected from two three-member aboriginal constituencies. Members serve four-year terms. Originally the unicameral National Assembly, as a standing constitutional convention and electoral college, held some parliamentary functions, but the National Assembly was abolished in 2005 with the power of constitutional amendments handed over to the Legislative Yuan and all eligible voters of the Republic via referendums.
The premier is selected by the president without the need for approval from the legislature, but the legislature can pass laws without regard for the president, as neither he nor the Premier wields veto power. Thus, there is little incentive for the president and the legislature to negotiate on legislation if they are of opposing parties. After the election of the pan-Green's Chen Shui-bian as President in 2000, legislation repeatedly stalled because of deadlock with the Legislative Yuan, which was controlled by a pan-Blue majority. Historically, the ROC has been dominated by strongman single party politics. This legacy has resulted in executive powers currently being concentrated in the office of the president rather than the premier, even though the constitution does not explicitly state the extent of the president's executive power.
The Judicial Yuan is the highest judicial organ. It interprets the constitution and other laws and decrees, judges administrative suits, and disciplines public functionaries. The president and vice-president of the Judicial Yuan and additional thirteen justices form the Council of Grand Justices. They are nominated and appointed by the president, with the consent of the Legislative Yuan. The highest court, the Supreme Court, consists of a number of civil and criminal divisions, each of which is formed by a presiding judge and four associate judges, all appointed for life. In 1993, a separate constitutional court was established to resolve constitutional disputes, regulate the activities of political parties and accelerate the democratization process. There is no trial by jury but the right to a fair public trial is protected by law and respected in practice; many cases are presided over by multiple judges.
Capital punishment is still used in Taiwan, although efforts have been made by the government to reduce the number of executions. Nevertheless, according to a survey in 2006, about 80% of Taiwanese still wanted to keep the death penalty.
The Control Yuan is a watchdog agency that monitors (controls) the actions of the executive. It can be considered a standing commission for administrative inquiry and can be compared to the Court of Auditors of the European Union or the Government Accountability Office of the United States.
The Examination Yuan is in charge of validating the qualification of civil servants. It is based on the old imperial examination system used in dynastic China. It can be compared to the European Personnel Selection Office of the European Union or the Office of Personnel Management of the United States.
The tension between China and Taiwan colours most of the political life, and any government move towards "Taiwan independence" is met by threat of military attack from the PRC. The PRC's official policy is to reunify Taiwan and mainland China under the formula of "one country, two systems" and refuses to renounce the use of military force, especially should Taiwan seek a declaration of independence.
The political scene is generally divided into two major camps in terms of views on how Taiwan should relate to China or the PRC, referred to as cross-Strait relations. It is the main political difference between two camps: the Pan-Blue Coalition, composed of the pro-unification Kuomintang, People First Party (PFP), and New Party, who believe that the ROC is the sole legitimate government of "China" (including Taiwan) and supports eventual Chinese reunification. The opposition Pan-Green Coalition is composed of the pro-independence DPP and Taiwan Solidarity Union (TSU). It regards Taiwan as an independent, sovereign state synonymous with the ROC, opposes the definition that Taiwan is part of "China", and seeks wide diplomatic recognition and an eventual declaration of formal Taiwan independence. The Pan-Green camp tends to favour emphasizing the Republic of China as being a distinct country from the People's Republic of China. Thus, in September 2007, the then ruling Democratic Progressive Party approved a resolution asserting separate identity from China and called for the enactment of a new constitution for a "normal country". It called also for general use of "Taiwan" as the country's name, without abolishing its formal name, the "Republic of China". Some members of the coalition, such as former President Chen Shui-bian, argue that it is unnecessary to proclaim independence because "Taiwan is already an independent, sovereign country" and the Republic of China is the same as Taiwan. Despite being a member of KMT prior to and during his presidency, Lee Teng-hui also held a similar view and was a supporter of the Taiwanization movement.
Pan-Blue members generally support the concept of the One-China policy, which states that there is only one China and that its only government is the ROC. They favour eventual re-unification of China. The more mainstream Pan-Blue position is to lift investment restrictions and pursue negotiations with the PRC to immediately open direct transportation links. Regarding independence, the mainstream Pan-Blue position is to maintain the status quo, while refusing immediate reunification. President Ma Ying-jeou stated that there will be no unification nor declaration of independence during his presidency. As of 2009, Pan-Blue members usually seek to improve relationships with mainland China, with a current focus on improving economic ties.
The dominant political issue in Taiwan is its relationship with the PRC. For almost 60 years, there were no direct transportation links, including direct flights, between Taiwan and mainland China. This was a problem for many Taiwanese businesses that had opened factories or branches in mainland China. The former DPP administration feared that such links would lead to tighter economic and political integration with mainland China, and in the 2006 Lunar New Year Speech, President Chen Shui-bian called for managed opening of links. Direct weekend charter flights between Taiwan and mainland China began in July 2008 under the current KMT government, and the first direct daily charter flights took off in December 2008.
Other major political issues include the passage of an arms procurement bill that the United States authorized in 2001. In 2008, however, the United States was reluctant to send over more arms to Taiwan out of fear that it would hinder the recent improvement of ties between the PRC and the ROC. Another major political issue is the establishment of a National Communications Commission to take over from the Government Information Office, whose advertising budget exercised great control over the media.
The politicians and their parties have themselves become major political issues. Corruption among some DPP administration officials has been exposed. In early 2006, President Chen Shui-bian was linked to possible corruption. The political effect on President Chen Shui-bian was great, causing a divide in the DPP leadership and supporters alike. It eventually led to the creation of a political camp led by ex-DPP leader Shih Ming-teh which believes the president should resign. The KMT assets continue to be another major issue, as it was once the richest political party in the world. Nearing the end of 2006, KMT's chairman Ma Ying-jeou was also hit by corruption controversies, although he has since then been cleared of any wrongdoings by the courts. After completing his second term as President, Chen Shui-bian was charged with corruption and money laundering. Following his conviction, he is serving a 17-year sentence in Taipei Prison.
Roughly 84% of Taiwan's population descends from Han Chinese who migrated from Qing China between 1661 and 1895. Another significant fraction descends from Han Chinese who immigrated from mainland China in the late 1940s and early 1950s. The shared cultural origin combined with several hundred years of geographical separation, some hundred years of political separation and foreign influences, as well as hostility between the rival ROC and PRC have resulted in national identity being a contentious issue with political overtones. Since democratization and the lifting of martial law, a distinct Taiwanese identity (as opposed to Taiwanese identity as a subset of a Chinese identity) is often at the heart of political debates. Its acceptance makes the island distinct from mainland China, and therefore may be seen as a step towards forming a consensus for de jure Taiwan independence. The pan-green camp supports a distinct Taiwanese identity, while the pan-blue camp supports a Chinese identity only. The KMT has downplayed this stance in the recent years and now supports a Taiwanese identity as part of a Chinese identity.
According to a survey conducted in March 2009, 49% of the respondents consider themselves as Taiwanese only, and 44% of the respondents consider themselves as Taiwanese and Chinese. 3% consider themselves as only Chinese. Another survey, conducted in Taiwan in July 2009, showed that 82.8% of respondents consider the ROC and the PRC as two separate countries with each developing on its own. A survey conducted in December 2009 showed that 62% of the respondents consider themselves as Taiwanese only, and 22% of the respondents consider themselves as both Taiwanese and Chinese. 8% consider themselves as only Chinese. The survey also shows that among 18- to 29-year-old respondents, 75% consider themselves as Taiwanese only.
In the latest survey conducted by National Chengchi University in 2014 and published in early 2015, 60.6% of respondents identified themselves exclusively as Taiwanese, 32.5% identified themselves as both Taiwanese and Chinese and 3.5% identified themselves as Chinese.
The Republic of China Army takes its roots in the National Revolutionary Army, which was established by Sun Yat-sen in 1925 in Guangdong with a goal of reunifying China under the Kuomintang. When the People's Liberation Army won the Chinese Civil War, much of the National Revolutionary Army retreated to Taiwan along with the government. It was later reformed into the Republic of China Army. Units which surrendered and remained in mainland China were either disbanded or incorporated into the People's Liberation Army.
Today, the Republic of China maintains a large and technologically advanced military, mainly as defence against the constant threat of invasion by the PRC under the Anti-Secession Law of the People's Republic of China. From 1949 to the 1970s, the primary mission of the military was to "retake the mainland" through Project National Glory. As this mission has shifted to defence, the ROC military has begun to shift emphasis from the traditionally dominant Army to the air force and navy.
Control of the armed forces has also passed into the hands of the civilian government. As the ROC military shares historical roots with the KMT, the older generation of high-ranking officers tends to have Pan-Blue sympathies. However, many have retired and there are many more non-mainlanders enlisting in the armed forces in the younger generations, so the political leanings of the military have moved closer to the public norm in Taiwan.
The ROC began a force reduction program, Jingshi An (translated to streamlining program), to scale down its military from a level of 450,000 in 1997 to 380,000 in 2001. As of 2009, the armed forces of the ROC number approximately 300,000, with nominal reserves totalling 3.6 million as of 2005. Conscription remains universal for qualified males reaching age eighteen, but as a part of the reduction effort many are given the opportunity to fulfill their draft requirement through alternative service and are redirected to government agencies or defence related industries. Current plans call for a transition to a predominantly professional army over the next decade. Conscription periods are planned to decrease from 14 months to 12. In the last months of the Bush administration, Taipei took the decision to reverse the trend of declining defence spending, at a time when most Asian countries kept on reducing their military expenditures. It also decided to modernize both defensive and offensive capabilities. Taipei still keeps a large military apparatus relative to the island's population: defence expenditures for 2008 were NTD 334 billion (approximately US $10.5 billion), which accounted for 2.94% of GDP.
The armed forces' primary concern at this time, according to the National Defense Report, is the possibility of an invasion by the PRC, consisting of a naval blockade, airborne assault, and/or missile bombardment. Four upgraded Kidd-class destroyers were purchased from the United States, and commissioned into the Republic of China Navy in 2005–2006, significantly upgrading Taiwan's air defence and submarine hunting abilities. The Ministry of National Defense planned to purchase diesel-powered submarines and Patriot anti-missile batteries from the United States, but its budget has been stalled repeatedly by the opposition-Pan-Blue Coalition controlled legislature. The defence package was stalled from 2001 to 2007 where it was finally passed through the legislature and the US responded on 3 October 2008, with a $6.5 billion arms package including PAC III Anti-Air defence systems, AH-64D Apache Attack helicopters and other arms and parts. A significant amount of military hardware has been bought from the United States, and, as of 2009, continues to be legally guaranteed by the Taiwan Relations Act. In the past, France and the Netherlands have also sold military weapons and hardware to the ROC, but they almost entirely stopped in the 1990s under pressure of the PRC.
The first line of defence against invasion by the PRC is the ROC's own armed forces. Current ROC military doctrine is to hold out against an invasion or blockade until the US military responds. There is, however, no guarantee in the Taiwan Relations Act or any other treaty that the United States will defend Taiwan, even in the event of invasion. The joint declaration on security between the US and Japan signed in 1996 may imply that Japan would be involved in any response. However, Japan has refused to stipulate whether the "area surrounding Japan" mentioned in the pact includes Taiwan, and the precise purpose of the pact is unclear. The Australia, New Zealand, United States Security Treaty (ANZUS Treaty) may mean that other US allies, such as Australia, could theoretically be involved. In practice, the risk of losing economic ties with China may prevent Australia from taking action. The United States, United Kingdom, Japan, South Korea, Australia, Canada, Chile, and Peru conduct maritime exercises in the Pacific Ocean every two years called RIMPAC. They are conducted to promote stability and to be able to respond in case of an armed conflict in the region – that includes an invasion of Taiwan by China.
According to the 1947 constitution, the territory of the ROC is according to its "existing national boundaries". According to the Executive Yuan in 2012, Mongolia was re-recognized by Republic of China as an independent country when the constitution was announced in 1946.
When the ROC retreated to Taiwan in 1949, its claimed territory consisted of 35 provinces, 12 special municipalities, 1 special administrative region and 2 autonomous regions. However, since its retreat, the ROC has controlled only Taiwan Province and some islands of Fujian Province. The ROC also controls the Pratas Islands and Taiping Island in the Spratly Islands, which are part of the disputed South China Sea Islands. They were placed under Kaohsiung administration after the retreat to Taiwan.
Since 1949, the government has made some changes in the area under its control. Taipei became a special municipality in 1967 and Kaohsiung in 1979. The two provincial governments were "streamlined", with their functions transferred to the central government (Fujian in 1956 and Taiwan in 1998). In 2010, New Taipei, Taichung and Tainan were upgraded to special municipalities. And in 2014, Taoyuan County was also upgraded to Taoyuan special municipality
According to Article 4 of the Local Government Act, laws pertaining to special municipalities also apply to counties with a population exceeding 2 million. This provision does not currently apply to any county, although it previously applied to Taipei County (now New Taipei City) and Taoyuan County (now Taoyuan City).
The quick industrialization and rapid growth of Taiwan during the latter half of the 20th century has been called the "Taiwan Miracle". Taiwan is one of the "Four Asian Tigers" alongside Hong Kong, South Korea and Singapore.
Japanese rule prior to and during World War II brought changes in the public and private sectors, most notably in the area of public works, which enabled rapid communications and facilitated transport throughout much of the island. The Japanese also improved public education and made it compulsory for all residents of Taiwan.
By 1945, hyperinflation was in progress in mainland China and Taiwan as a result of the war with Japan. To isolate Taiwan from it, the Nationalist government created a new currency area for the island, and began a price stabilization program. These efforts significantly slowed inflation.
When the KMT government fled to Taiwan it brought millions of taels (where 1 tael ~1.2 ozt) of gold and the foreign currency reserve of mainland China, which, according to the KMT, stabilized prices and reduced hyperinflation. Perhaps more importantly, as part of its retreat to Taiwan, the KMT brought the intellectual and business elites from Mainland China. The KMT government instituted many laws and land reforms that it had never effectively enacted on mainland China. The government also implemented a policy of import-substitution, attempting to produce imported goods domestically.
In 1950, with the outbreak of the Korean War, the United States began an aid program which resulted in fully stabilized prices by 1952. Economic development was encouraged by American economic aid and programs such as the Joint Commission on Rural Reconstruction, which turned the agricultural sector into the basis for later growth. Under the combined stimulus of the land reform and the agricultural development programs, agricultural production increased at an average annual rate of 4 per cent from 1952 to 1959, which was greater than the population growth, 3.6%.
In 1962, Taiwan had a (nominal) per-capita gross national product (GNP) of $170, placing its economy on a par with those of the Democratic Republic of the Congo. On a purchasing power parity (PPP) basis, its GDP per capita in the early 1960s was $1,353 (in 1990 prices). By 2011 per-capita GNP, adjusted for purchasing power parity (PPP), had risen to $37,000, contributing to a Human Development Index (HDI) equivalent to that of other developed countries. Taiwan's HDI in 2012 is 0.890, (23rd, very high), according to the UN's new "Inequality-adjusted HDI" calculation method.
In 1974, Chiang Ching-kuo implemented the Ten Major Construction Projects, the beginning foundations that helped Taiwan transform into its current export driven economy. Since the 1990s, a number of Taiwan-based technology firms have expanded their reach around the world. Well-known international technology companies headquartered in Taiwan include personal computer manufacturers Acer Inc. and Asus, mobile phone maker HTC, as well as electronics manufacturing giant Foxconn, which makes products for Apple, Amazon, and Microsoft. Computex Taipei is a major computer expo, held since 1981.
Today Taiwan has a dynamic, capitalist, export-driven economy with gradually decreasing state involvement in investment and foreign trade. In keeping with this trend, some large government-owned banks and industrial firms are being privatized. Real growth in GDP has averaged about 8% during the past three decades. Exports have provided the primary impetus for industrialization. The trade surplus is substantial, and foreign reserves are the world's fifth largest. The Republic of China has its own currency, the New Taiwan dollar.
Since the beginning of the 1990s, the economic ties between Taiwan and the People's Republic of China have been very prolific. As of 2008, more than US$150 billion have been invested in the PRC by Taiwanese companies, and about 10% of the Taiwanese labour force works in the PRC, often to run their own businesses. Although the economy of Taiwan benefits from this situation, some have expressed the view that the island has become increasingly dependent on the Mainland Chinese economy. A 2008 white paper by the Department of Industrial Technology states that "Taiwan should seek to maintain stable relation with China while continuing to protect national security, and avoiding excessive 'Sinicization' of Taiwanese economy." Others argue that close economic ties between Taiwan and Mainland China would make any military intervention by the PLA against Taiwan very costly, and therefore less probable.
Taiwan's total trade in 2010 reached an all-time high of US$526.04 billion, according to Taiwan's Ministry of Finance. Both exports and imports for the year reached record levels, totalling US$274.64 billion and US$251.4 billion, respectively.
In 2001, agriculture constituted only 2% of GDP, down from 35% in 1952. Traditional labour-intensive industries are steadily being moved offshore and with more capital and technology-intensive industries replacing them. High-technology industrial parks have sprung up in every region in Taiwan. The ROC has become a major foreign investor in the PRC, Thailand, Indonesia, the Philippines, Malaysia, and Vietnam. It is estimated that some 50,000 Taiwanese businesses and 1,000,000 businesspeople and their dependents are established in the PRC.
Because of its conservative financial approach and its entrepreneurial strengths, Taiwan suffered little compared with many of its neighbours from the 1997 Asian financial crisis. Unlike its neighbours, South Korea and Japan, the Taiwanese economy is dominated by small and medium-sized businesses, rather than the large business groups. The global economic downturn, however, combined with poor policy co-ordination by the new administration and increasing bad debts in the banking system, pushed Taiwan into recession in 2001, the first whole year of negative growth since 1947. Due to the relocation of many manufacturing and labour-intensive industries to the PRC, unemployment also reached a level not seen since the 1970s oil crisis. This became a major issue in the 2004 presidential election. Growth averaged more than 4% in the 2002–2006 period and the unemployment rate fell below 4%.
The ROC often joins international organizations (especially ones that also include the People's Republic of China) under a politically neutral name. The ROC has been a member of governmental trade organizations such as the World Trade Organization under the name Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei) since 2002.
The Ministry of Transportation and Communications of the Republic of China is the cabinet-level governing body of the transportation network in Taiwan. Taiwan has an extensive highway network, classified into five levels: national highways, provincial highways, county routes, township routes, and special routes, with the first four being common. Taiwan also has an extensive bus network, most of which are run by private bus companies. Inter-city rail services are provided by Taiwan Railway Administration (TRA) and Taiwan High Speed Rail (THSR). Rapid transit systems include the Taipei Metro, Taoyuan Metro (incl. the Airport MRT) and Kaohsiung MRT, while Taichung Metro is under construction. Major airports include Taiwan Taoyuan, Kaohsiung, Taipei Songshan and Taichung. There are currently seven airlines in Taiwan, the largest ones being China Airlines and EVA Air. There are four international seaports: Keelung, Kaohsiung, Taichung, and Hualien.
The higher education system was established in Taiwan by Japan during the colonial period. However, after the Republic of China took over Taiwan from Japan in 1945, the system was promptly replaced by the same system as in mainland China which mixed with features of the Chinese and American educational systems.
Taiwan is well known for adhering to the Confucian paradigm of valuing education as a means to improve one's socioeconomic position in Taiwanese society. Heavy investment and a cultural value for education has catapulted the resource poor nation consistently atop the global education rankings. Taiwan is one of the top-performing countries in reading literacy, maths and sciences. In 2015, Taiwanese students achieved one of the world's best results in mathematics, science and literacy, as tested by the Programme for International Student Assessment (PISA), a worldwide evaluation of 15-year-old school pupils' scholastic performance. The strong scholastic and educational performance of Taiwanese students has prompted the nation to build a highly educated labour force that possesses a strong background in mathematics and science to cope with the current labor market demands of the 21st century.
The Taiwanese education system has been praised for various reasons including its comparatively high test results and its major role in ushering Taiwan's economic development while creating one of the world’s most highly educated workforces. The country has also been praised for its high university entrance rate where the university acceptance rate has increased from around 20 percent before the 1970s to 49 percent in 1996 and over 90 percent since 2006, among the highest in Asia. The nation's high university entrance rate has created a highly skilled workforce making Taiwan one of the most highly educated countries in the world with 68.5% of Taiwanese high school students going on to attend university. Taiwan has a high percentage of its citizens holding a tertiary education degree where 45 percent of Taiwanese aged 25–64 hold a bachelors degree or higher compared with the average of 33 percent among member countries of the Organization for Economic Cooperation and Development (OECD). On the other hand, the system has been criticized for placing excessive pressure on students and eschewing creativity in favor of rote memorization. In addition, the system has been criticized for producing an excess supply of over-educated university graduates and a higher unemployment rate. With a large supply of university graduates seeking a limited demand of prestigious white collar jobs in an environment that is increasingly losing its competitive edge has led many degree holders ending up with lower end jobs with salaries far beneath than their expectations. Taiwan’s universities have also been under criticism for not being able to fully meet the requirements and demands of Taiwan’s 21st century fast-moving job market citing a skills mismatch among a large number of self-assessed overeducated university graduates that don't fit the demands of the modern Taiwanese labor market. The Taiwanese government has also been criticized for undermining the economy as it has been unable to produce enough jobs to meet the demands of numerous underemployed university graduates.
As the Taiwanese economy is largely science and technology based, the labor market demands people who have achieved some form of higher education, particularly related to science and engineering in order to gain a competitive edge when searching for employment. Although current Taiwanese law mandates only nine years of schooling, 95% of junior high graduates go on to attend a senior vocational high school, university, junior college, trade school, or other higher education institution.
Many Taiwanese students attend cram schools, or bushiban, to improve skills and knowledge on problem solving against exams of subjects like mathematics, nature science, history and many others. Courses are available for most popular subjects. Lessons are organized in lectures, reviews, private tutorial sessions, and recitations.
As of 2013, the literacy rate in Taiwan is 97.15%.
Taiwan's population is about 23.4 million, most of whom are on the island proper. The remainder live on Penghu (101,758), Kinmen (127,723), and Matsu (12,506).
The ROC government reports that over 95% of the population is Han, of which the majority includes descendants of early Han Chinese immigrants who arrived in Taiwan in large numbers starting in the 18th century. Alternatively, the ethnic groups of Taiwan may be roughly divided among the Hoklo (70%), the Hakka (14%), the Waishengren (14%), and indigenous peoples (2%).
The Hoklo people are the largest Han subgroup (70% of the total population), whose ancestors migrated from the coastal southern Fujian region across the Taiwan Strait starting in the 17th century. The Hakka comprise about 15% of the total population, and descend from Han migrants to Guangdong, its surrounding areas and Taiwan. Additional people of Han origin include and descend from the 2 million Nationalists who fled to Taiwan following the communist victory on the mainland in 1949.
The indigenous Taiwanese aborigines number about 533,600 and are divided into 16 recognized groups. The Ami, Atayal, Bunun, Kanakanavu, Kavalan, Paiwan, Puyuma, Rukai, Saisiyat, Saaroa, Sakizaya, Sediq, Thao, Truku and Tsou live mostly in the eastern half of the island, while the Yami inhabit Orchid Island.
Mandarin is the official national language and is spoken by the vast majority of the population of Taiwan. It has been the primary language of instruction in schools since the end of Japanese rule. As in Hong Kong and Macau, Traditional Chinese is used as the writing system in Taiwan.
The 70% of the population belonging to the Hoklo ethnic group speak Taiwanese Hokkien (a variant of the Min Nan speech of Fujian province) as their mother tongue, in addition to Mandarin, and many others have some degree of understanding. The Hakka ethnic group (15% of the population) use Hakka Chinese. Most waishengren speak primarily Mandarin. Although Mandarin is the language of instruction in schools and dominates television and radio, non-Mandarin Chinese varieties have undergone a revival in public life in Taiwan, particularly since restrictions on their use were lifted in the 1990s.
Taiwan's indigenous languages, the Formosan languages, do not belong to the Chinese or Sino-Tibetan language family, but rather to the Austronesian language family. Their use among Taiwan's aboriginal minority groups has been in decline as usage of Mandarin has risen. Of the 14 extant languages, five are considered moribund.
The Constitution of the Republic of China protects people's freedom of religion and the practices of belief. There are approximately 18,718,600 religious followers in Taiwan as of 2005 (81.3% of total population) and 14–18% are non-religious. According to the 2005 census, of the 26 religions recognized by the ROC government, the five largest are: Buddhism (8,086,000 or 35.1%), Taoism (7,600,000 or 33%), Yiguandao (810,000 or 3.5%), Protestantism (605,000 or 2.6%), and Roman Catholicism (298,000 or 1.3%).
The CIA World Factbook reports that over 93% of Taiwanese are adherents of a combination of the polytheistic Chinese popular religion, Buddhism, Confucianism, and Taoism; 4.5% are adherents of Christianity, which includes Protestants, Catholics, and other, non-denominational, Christian groups; and less than 2.5% are adherents of other religions. Taiwanese aborigines comprise a notable subgroup among professing Christians: "...over 64% identify as Christian... Church buildings are the most obvious markers of Aboriginal villages, distinguishing them from Taiwanese or Hakka villages."
Confucianism is a philosophy that deals with secular moral ethics, and serves as the foundation of both Chinese and Taiwanese culture. The majority of Taiwanese people usually combine the secular moral teachings of Confucianism with whatever religions they are affiliated with.
As of 2009, there were 14,993 temples in Taiwan, approximately one place of worship per 1,500 residents. 9,202 of those temples were dedicated to Taoism. In 2008, Taiwan had 3,262 Churches, an increase of 145.
The figures below are the 2011 estimates for the twenty largest urban populations within administrative city limits; a different ranking exists when considering the total metropolitan area populations (in such rankings the Taipei-Keelung metro area is by far the largest agglomeration).