Taiwan in 2002: Another Year of Political Droughts and Typhoons

Taiwan's streak of bad luck continued in 2002, as economic and political stagnation plagued the island. Cross-strait relations suffered from President Chen Shui-bian's mid-summer reference to "a country on each side of the Strait," although Beijing's sense that the long-term prospects for unification are improving permitted a moderate response. Taiwan's domestic political scene was troubled by partisan divisions and disagreements over how best to manage an economic recession, now in its third year. By any measure—economic, political, or diplomatic—Taiwan's misfortunes abated only slightly in 2002, while confidence in leaders and institutions continued to sink. The stock market hovered near record lows, while unemployment rates approached record highs. Overall, Taiwan's political and economic performance remains so deficient that scholars and citizens alike are questioning whether Taiwan's poorly designed institutions can weather the relentless storms battering the island.