Taiwan
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Over the next five decades, the ruling authorities gradually democratized and incorporated the local population within the governing structure. In 2000, Taiwan underwent its first peaceful transfer of power from the Nationalist to the Democratic Progressive Party. Throughout this period, the island prospered and became one of East Asia's economic "Tigers." The dominant political issues continue to be the relationship between Taiwan and China - specifically the question of eventual unification - as well as domestic political and economic reform. Taiwan has a dynamic capitalist economy with gradually decreasing guidance of investment and foreign trade by the authorities. In keeping with this trend, some large, state-owned banks and industrial firms are being privatized. Exports have provided the primary impetus for industrialization. The island runs a large trade surplus, and its foreign reserves are among the world's largest. Despite restrictions on cross-strait links, China has overtaken the US to become Taiwan's largest export market and its second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Strong trade performance in 2007 pushed Taiwan's GDP growth rate above 5%, and unemployment is below 4%. Source: The Places Factbook, CIA. |
In
1895, military defeat forced China to cede Taiwan to Japan. Taiwan reverted to
Chinese control after Places War II. Following the Communist victory on the
mainland in 1949, 2 million Nationalists fled to Taiwan and established a
government using the 1946 constitution drawn up for all of China.