China
Is Taiwan a country or not?
The UK referred to Taiwan as an “independent country” in a report, despite not officially recognizing Taiwan as a country.
Defining what is and isn’t a country is a lot more complicated than many people would realize. Take the case of Taiwan.
On Aug. 30, 2023, a committee of the U.K. Parliament referred to Taiwan as an “independent country” in a report. This is the first time any part of the British political system has used that phrasing.
Officially, the U.K. “does not recognise Taiwan” as a country, nor does it “maintain formal diplomatic relations with the island,” which is one way states recognize each other as equals on the international stage.
Like the U.K., the U.S. also “does not have diplomatic relations with Taiwan,” although there is a “robust unofficial relationship,” according to the State Department. Many other countries are in a similar boat.
So where does that leave Taiwan? Is it, or is it not, a country?
From my perspective as a political scientist, here’s how I would approach this question.
A country by declaration
According to what’s known as the “declarative theory of statehood,” a country – which is often referred to as a “state” in political science and international relations terminology – must possess the following qualities: “(a) a permanent population; (b) a defined territory; (c) government; and (d) capacity to enter into relations with the other states.”
These four qualities were agreed upon in the 1933 Montevideo Convention on the Rights and Duties of States, which is an international treaty registered with the League of Nations, the precursor to the United Nations.
Article 3 of that treaty says that the existence of a “state is independent of recognition by the other states.” In other words, as long as the four qualities above are met, an area qualifies as a country even if other countries choose not to recognize it.
One criticism of this framework is that it opens the door for many areas to be considered countries, even though they may seem outlandish.
For example, in the 1960s, Italian engineer Giorgio Rosa built a 4,000-square-foot (400-square-meter) platform 7 miles (11 kilometers) off the coast of Italy. On June 24, 1968, Rosa – whose last name means “rose” in English – declared that his platform was an independent country named the Republic of Rose Island. This artificial island had a restaurant, bar, souvenir shop and post office. Its official language was Esperanto.
It could be argued that Rose Island met the criteria outlined in the Montevideo Convention, as there was a permanent population because Rosa lived there; his humanmade platform had a defined territory; there was a government because Rosa declared himself president; and Rose Island’s post office gave it the capacity to communicate with, and thus enter into relations with, other countries.
Although several countries, including the U.S., have ratified the Montevideo Convention, Italy has not. So, 55 days after Rose Island declared independence, the Italian military destroyed the platform.
A country by recognition
In contrast to the declarative theory of statehood, what’s called the “constitutive theory of statehood” considers a country to be a country only if it is recognized by other already recognized countries.
There is no magic number for how many countries one must be recognized by. Rather, those that aspire to be regarded by the world as an independent country must join the United Nations as a full member.
In order to join the United Nations, applicants must be recommended by the Security Council, which comprises 15 members. Five of those members are permanent and have a veto. Applicants must have the support of nine of the 15 members, including each of the permanent members.
If the Security Council recommends admission, the application is presented to the General Assembly, where each full member of the United Nations has a single vote. A two-thirds majority is necessary before a country can join.
U.S. Rep. Rob Wittman, vice chairman of the House Armed Services Committee, met with Taiwan’s President Tsai Ing-wen, right, at the presidential office in Taipei, Taiwan, in September 2023.
Taiwan Presidential Office via AP
One China or two?
Today, most of the world’s countries officially adhere to some variation of the idea that there is only one China, whose capital is Beijing, and which encompasses both the mainland territory and the island of Taiwan.
There is a government there, but there is also a government on Taiwan, based in its capital, Taipei. That government calls itself the Republic of China and traces its history to the early 20th century, when a revolution overthrew the emperor of China.
Notably, at that time, nobody’s definition of China included the island of Taiwan, which was then commonly called Formosa. Japan had seized the island in a war in the late 19th century.
In 1927, an uprising by the Chinese Communist Party attacked the Republic of China government. That kicked off a bloody civil war that lasted until 1949.
In that year, the government of the Republic of China retreated to the island of Taiwan. That same year, Mao Zedong, leader of the Chinese Communist Party, proclaimed the founding of the People’s Republic of China, with its capital in Beijing.
But Mao still sought control over his enemy’s territory, declaring, “Taiwan is ours, and we will never compromise on this issue, which is an issue of internal affairs.”
To this day, the government of the People’s Republic of China, whose capital is Beijing, considers Taiwan part of its “sacred territory.” The constitution of the People’s Republic of China states that “(i)t is the lofty duty of the entire Chinese people, including our compatriots in Taiwan, to accomplish the great task of reunifying the motherland.” Its foreign affairs ministry says, “Taiwan is a sacred and inseparable part of China’s territory.” On Oct. 2, 2023, the Beijing government celebrated its national day by releasing a video signifying its focus on unity with the people of Taiwan.
In contrast, the Republic of China refers to the area under its control as “the Taiwan area,” or “the free area.” It refers to the rest of China as “the mainland area,” which the Taiwanese government has described as being under a “Period of Communist Rebellion.”
Other countries are similarly delicate. For example, in 1972, the U.S. “acknowledge(d) that all Chinese on either side of the Taiwan Strait maintain there is but one China and that Taiwan is a part of China.” In 1979, the U.S. again “acknowledge(d) the Chinese position that there is but one China and Taiwan is part of China.”
Taipei’s Mid-Autumn Festival drew crowds to the Night Market.
AP Photo/Chiang Ying-ying
Taiwan’s place in the world
Taiwan argues that it meets the Montevideo Convention’s criteria for being considered a country under the declarative theory of statehood. However, Taiwan has not yet formally declared itself to be a new, independent country. According to President Tsai Ing-wen, “(w)e don’t have a need to,” because “(w)e are an independent country already and we call ourselves the Republic of China.”
But recall that, according to the constitutive theory of statehood, a country is only a country if it’s recognized by other already recognized countries, and the ultimate manifestation of such recognition is full membership in the United Nations.
Interestingly, the Republic of China was actually a founding member of the United Nations. However, in 1971, the United Nations voted “to expel” the Republic of China, and instead recognized the Communist government “as the only legitimate representative of China to the United Nations.” Subsequent attempts by Taiwan to join the United Nations have been unsuccessful.
Today, only a dozen or so countries continue to maintain formal diplomatic ties with Taiwan, most of which are small island developing states such as Nauru, Palau and Tuvalu.
Each of these countries recognizes Taiwan as “the Republic of China,” and none of them simultaneously maintains offical ties with the People’s Republic of China.
Until Taiwan formally declares itself independent of the rest of China – or until Taiwan is recognized by the international community as being independent of the rest of China – Taiwan’s status as a country will continue to be questioned.
This article is republished from The Conversation under a Creative Commons license. Read the original article.
China
2024 Tax Incentives for Manufacturing Companies in China
China offers various tax incentives to boost the manufacturing industry. The Ministry of Finance and State Tax Administration provide guidelines on eligibility and policies. VAT exemptions and refunds are available for companies producing specific goods or services, with a monthly refund option for deferred taxes.
China implements a wide range of preferential tax policies to encourage the development of the country’s manufacturing industry. We summarize some of the main manufacturing tax incentives in China and explain the basic eligibility requirements that companies must meet to enjoy them.
China’s Ministry of Finance (MOF) and State Tax Administration (STA) have released guidelines on the main preferential tax and fee policies available to the manufacturing industry in China. The guidelines consolidate the main preferential policies currently in force and explain the main eligibility requirements to enjoy them.
To further assist companies in identifying the preferential policies available to them, we have outlined some of the main policies currently available in the manufacturing industry, including links to further resources.
For instance, VAT is exempted for:
Companies providing the following products and services can enjoy immediate VAT refunds:
Companies in the manufacturing industry that meet the conditions for deferring tax refunds can enjoy a VAT credit refund policy. The policy allows companies to receive the accumulated deferred tax amount every month and the remaining deferred tax amount in a lump sum.
The policy is not exclusive to the manufacturing industry and is also available to companies in scientific research and technical services, utilities production and supply, software and IT services, and many more.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Exploring the Revamped China Certified Emission Reduction (CCER) Program: Potential Benefits for International Businesses
Companies in China must navigate compliance, trading, and reporting within the CCER framework, impacting operations and strategic objectives. The program focuses on afforestation, solar, wind power, and mangrove creation, offering opportunities for innovation and revenue streams while ensuring transparency and accuracy. The Ministry of Ecology and Environment oversees the program.
As companies navigate the complexities of compliance, trading, and reporting within the CCER framework, they must also contend with the broader implications for their operations, finances, and strategic objectives.
This article explores the multifaceted impact of the CCER program on companies operating in China, examining both the opportunities for innovation and growth, as well as the potential risks and compliance considerations.
Initially, the CCER will focus on four sectors: afforestation, solar thermal power, offshore wind power, and mangrove vegetation creation. Companies operating within these sectors can register their accredited carbon reduction credits in the CCER system for trading purposes. These sectors were chosen due to their reliance on carbon credit sales for profitability. For instance, offshore wind power generation, as more costly than onshore alternatives, stands to benefit from additional revenue streams facilitated by CCER transactions.
Currently, primary buyers are expected to be high-emission enterprises seeking to offset their excess emissions and companies aiming to demonstrate corporate social responsibility by contributing to environmental conservation. Eventually, the program aims to allow individuals to purchase credits to offset their carbon footprints. Unlike the mandatory national ETS, the revamped CCER scheme permits any enterprise to buy carbon credits, thereby expanding the market scope.
The Ministry of Ecology and Environment (MEE) oversees the CCER program, having assumed responsibility for climate change initiatives from the National Development and Reform Commission (NDRC) in 2018. Verification agencies and project operators are mandated to ensure transparency and accuracy in disclosing project details and carbon reduction practices.
On the second day after the launch on January 23, the first transaction in China’s voluntary carbon market saw the China National Offshore Oil Corporation (CNOOC), the country’s largest offshore oil and gas producer, purchase 250,000 tons of carbon credits to offset its emissions.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
China’s Ministry of Commerce announced new policy measures on April 19, 2023, to encourage foreign investment in the technology sector. The measures include facilitating bond issuance, improving the investment environment, and simplifying procedures for foreign institutions to access the Chinese market.
On April 19, 2023, China’s Ministry of Commerce (MOFCOM) along with nine other departments announced a new set of policy measures (hereinafter, “new measures”) aimed at encouraging foreign investment in its technology sector.
Among the new measures, China intends to facilitate the issuance of RMB bonds by eligible overseas institutions and encourage both domestic and foreign-invested tech companies to raise funds through bond issuance.
In this article, we offer an overview of the new measures and their broader significance in fostering international investment and driving innovation-driven growth, underscoring China’s efforts to instill confidence among foreign investors.
The new measures contain a total of sixteen points aimed at facilitating foreign investment in China’s technology sector and improving the overall investment environment.
Divided into four main chapters, the new measures address key aspects including:
Firstly, China aims to expedite the approval process for QFII and RQFII, ensuring efficient access to the Chinese market. Moreover, the government promises to simplify procedures, facilitating operational activities and fund management for foreign institutions.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
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- China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
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