This Week in Taiwan 0103-0109
January 5: Taiwan is approaching water shortage. The Council of Agriculture (COA) announced that it would suspend irrigation for nearly 28,000 hectares (about 69,190 acres) of land in the first phase. Accounting for earlier suspension of farm irrigation in Chiayi, Tainan, Taichung, Hsinchu, and Miaoli, the total suspended irrigation land area is more than 74,000 hectares (about 182,858 acres), more than 24 percent of the total irrigation area and the largest total area in two decades. The COA assessed that compensation for suspending irrigation due to the present drought, which persisted from the second phase last year to the first phase this year, will exceed NT$7 billion (about US$250 million).
January 5: Foreign hot money and panic by exporters to sell foreign currencies joined forces to break the defensive mechanism drawn by the Central Bank. The New Taiwan Dollar exchange rate broke through the benchmark of NT$28 to US$1, even attaining NT$27.973 at one point, rewriting a new high record in 23 years and opening a new foreign exchange era for Taiwan. Compared to the nine months it took to surpass the NT$29 benchmark, it took less than four months to break the NT$28 mark.
January 8: The Ministry of the Interior released the latest census statistics. The number of births between January and December 2020 was 165,249, a record low, while the number of deaths during the period was 173,156. With more deaths than births, Taiwan's population saw negative growth for the first time. The total population in Taiwan reached 23.56 million, a decline of more than 40,000 from the previous year. In addition, last year, only 121,702 couples married, the second lowest number in 48 years.
Because of these subpar marriage and childbirth figures, Taiwan will become a super-aged society earlier by 2025.
January 8: Secretary of State Mike Pompeo announced on January 7 that he will dispatch Kelly Craft, United States ambassador to the United Nations, to visit Taiwan. According to Pompeo, the visit to Taiwan is meant to demonstrate "what a free China could achieve." The use of the term "free China" met intense scrutiny and interpretation online.
The Ministry of Foreign Affairs (MOFA) announced that Ambassador Craft would lead a delegation to Taiwan between January 13 and 15. This is the first visit to Taiwan by a U.S. ambassador to the United Nations since the Republic of China withdrew from the U.N. in 1971. Ambassador Craft will meet with President Tsai Ing-wen and Foreign Minister Joseph Wu as well as deliver a speech at the Institute of Diplomacy and International Affairs of MOFA covering Taiwan's international participation and United Nations affairs.
Update: On January 12, the Department of State announced that the planned visit to Taiwan by Ambassador Craft would be canceled.
January 8: Taiwan stocks continue to surge, closing the Taiwan Capitalization Weighted Stock Index (TAIEX) at 15463.95, a record high, up 731.42 points in the first week of 2021. In addition, the Taiwan Semiconductor Manufacturing Company (TSMC), favored by institutional investors, saw its stock price rise for five consecutive days, up NT$50 (about US$1.78) or 9.43 percent in a single week, and its market capitalization rose some NT$1.29 trillion (about US$46 billion). With its American depositary receipt (ADR) stock price rising to US$121.43, the market capitalization of TSMC reached US$629.7 billion, the ninth largest globally behind China's Tencent, currently ranked eighth.
January 10: Secretary Pompeo announced lifting U.S. restrictions on official interactions with Taiwan. The move was welcomed by both ruling and opposition parties in Taiwan. The Kuomintang stated that whether this policy announced by the outgoing administration of President Donald Trump will extend into the administration of incoming President Joe Biden will be a key indicator. The KMT hopes that the rising level of official vists will continue into the future and encourage more substantial reciprocity of beneficial policies.
Some legislators have raised the question of whether the president, vice president, premier, vice premier, Minister of Foreign Affairs, and Minister of National Defense, may officially visit Washington.