CHAPTER IV RESULTS AND DISCUSSION
4.2 Aid Purposes
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to every partner country. Furthermore, more efforts are needed to improve diplomatic and negotiating skills so as to assure recipient countries that Taiwan is a good
development partner (S3, interviewee).
4.2 Aid Purposes
Taiwan became what it is today in part thanks to the kindness and generosity of the international community, so it hopes to repay its debt to the world for the enduring sense of benevolence. Also, Taiwan is a small island country, densely populated, and has few natural resources and raw materials. Therefore, it needs to develop relations with those countries whose roles are energy producers or transportation hubs (S1, interviewee). A number of oil producing countries were once its partner countries, Saudi Arabia, Kuwait, and Jordan included. Oil is Taiwan’s economic propeller, and giving foreign aid to them is out of concern about security. All along, Taiwan is willing to offer spiritual supports or disaster-relief aid to developing countries despite the lack of diplomatic ties. In general, the country’s aid motivations are as follows:
moral and security considerations, desires to develop foreign relations and increase its global visibility.
Each of Taiwan’s few remaining ally matters, and foreign aid has been playing a huge role in Taiwan’s foreign policies, so it is apparent that Taiwan is highly motivated in ODA (S2, interviewee). The most important criterion in deciding recipient countries is the level of friendliness (P1, interviewee). Foreign aid will not be given to a country that is very unfriendly to Taiwan no matter how poor it is because politics and
diplomacy are the top considerations to Taiwan. Interviewee P1 mentioned that Pakistan is not included in Taiwan ICDF’s international scholarship program due to
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the country’s apparent offensiveness to Taiwan. ODA is nation-to-nation with a high-level of interaction, and national identity should be beyond everything (P1, interviewee). If any of the recipients suppresses Taiwan, the government will be unaccountable to the citizens.
For a long time, Taiwan seems to overvalue diplomacy without paying enough attention to other dimensions like economy or trade. National interests have diversity, and diplomacy is only one of them, so it is unwise to devote most resources to this single purpose (P3, interviewee). The success of foreign aid should be a win-win, through which a satisfactory outcome is achieved and both the donor and the recipient benefit from. Speaking of benefits, the first thought is often economic opportunities.
Take a closer look at Taiwan’s trade condition, and it is found to have little in
common with the country’s overall diplomatic layout (P3, interviewee). Northeast and Southeast Asian nations are Taiwan’s important trade partners, while its diplomatic allies are mainly in Central America and Africa. Electronic products are a big trade item for Taiwan, while these are not a necessity to Taiwan’s partner countries in which agriculture and healthcare are given a higher priority than tablets (P1, interviewee).
Taiwanese ODA is given in the context of diplomatic competition with China, while South Korean ODA has varying goals, concerns, tools, and practical projects (Chien, 2010). It is time for Taiwan to step out diplomatic shadow and pursue win-win
foreign aid. South Korea’s foreign aid appears to provide potential economic benefits.
The country’s aid sectors happen to correspond to its economic focus areas (P3, interviewee). ICT is South Korea's key economic engine and the country has the
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world's highest ICT trade surplus. KOICA spent 23.6% of its total budget on ICT cooperation (KOICA, 2014). What’s more, South Korea finds great economic
significance and business opportunities in its recipient countries (Table 4.2). ASEAN is South Korea's largest ODA destination. The heavy concentration is closely related to high regional trade interdependence and volume (Kondoh, 2011). These nations are the newly emerging economies, and they have become FDI magnets.
Table 4.2: Economic Significance of South Korean ODA Recipients
Top Ten Recipients of S. Korean ODA
Significance to South Korea
1. Vietnam * S. Korea’s 4th trade partner
* S. Korea as the biggest investor
* The 4th largest destination for S. Korean FDI
* Korea-Vietnam FTA took effect in 2016.
2. Afghanistan * The silk road gateway
* A pipeline route for S. Korea's big energy investment in Central Asia
* S. Korea joins US-led coalition in Afghanistan
3. Mongolia * S. Korea as the 2nd biggest investor
* Upcoming Korea-Mongolia EPA
* Mongolia’s abundant natural resources.
4. Bangladesh * S. Korea as the 3rd biggest investor.
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5. Sri Lanka * S. Korea was the biggest investor in the 1980s, and it is trying to reclaim its top position in FDI.
6. Indonesia * S. Korea’s 15th trade partner
* S. Korea as the 5th biggest investor
* Korea-Indonesia FTA under negotiation.
7. Cambodia * S. Korea as the 2nd biggest investor
* Korea-Cambodia FTA took effect in 2008.
8. Philippines * S. Korea’s 13th trade partner
* S. Korea as the 6th largest investor.
9. Laos * S. Korea as the 4th biggest investor.
10. Angola * Angola as top oil producer in Africa
* The 2nd largest destination for S. Korean FDI in Africa.
(Source: OECD and WTO, the table was created by the researcher)
Interviewee P1 gave two specific examples about South Korea’s strong presence.
More and more foreign students decline Taiwanese scholarship offer in recent years, mostly because they are admitted to South Korean universities on full government scholarships. South Korea’s increasing popularity makes it more attractive to foreigners. And, in a satisfaction survey asking foreign students for feedback about learning experiences in Taiwan, each year at least ten percent of students respond in this way: I recommend Taiwan…, and Taiwan will be as great as the US, Japan, and South Korea. The answers are a signal that South Korea has been categorized into the same group along with the US and Japan. Free from geographical, historical, and
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cultural issues, the foreign students are an objective third party. Hence, it could be a warning sign to Taiwan that it needs to push itself harder to climb ranks. With the highest level of growth in aid budget in the last decade, South Korea outshines all the other countries in Asia, even Japan, partly due to Japan’s stagnant economy and South Korea’s relatively shiny economy.