[Big read] Taiwan President Lai Ching-te’s anti-corruption clampdown: Who’s next?

In early July, former Vice-Premier and former chair of the Straits Exchange Foundation Cheng Wen-tsan was detained and held incommunicado for allegedly accepting bribes in the development of the Huaya Science Park. This is a bombshell to the political circles in Taiwan. 

Within two months of his presidency, Lai Ching-te has acted decisively against Cheng, who was once regarded as a potential presidential candidate. This drastic move has created fear within the ruling Democratic Progressive Party (DPP) and stunned the opposition parties.

As Cheng is the two-term former mayor of Taoyuan, an extremely important position of authority in Taiwanese politics, the Taiwan Taoyuan District Prosecutors Office and the Taoyuan District Court have crossed swords three times on whether to detain him. 

The Taoyuan District Court finally ruled on 11 July to detain Cheng and dismissed his lawyer’s appeal against the detention on 12 July. The DPP has further barred Cheng from holding public office for three years, marking the end of his political career.

The bribery case against Cheng allegedly dates back to 2017, the second year of the presidency of the DPP’s Tsai Ing-wen. Although the prosecutors then had evidence, including wiretap transcripts and photographs of key witnesses entering Cheng’s official residence, the case was dismissed due to “insufficient evidence”. Most of the investigators, such as then Taoyuan District prosecutor and Kuomintang (KMT) legislator Wu Tsung-hsien, were either reassigned or left in disillusionment.

After Lai took office on 20 May, the investigation of the case was quickly reactivated in June. Four key witnesses, including two surnamed Yang and Liao respectively, were interviewed and detained. Cheng was interviewed in the early morning the day after returning from Japan on 4 July. The entire investigation operation is kept tightly under wraps.

The political circles are rife with speculations and conspiracy theories, with some suggesting that Lai’s true target might be former President Tsai Ing-wen and her supporters who suppressed him during the 2019 presidential primary contest. Others speculate that Lai’s next target might be Taiwan People’s Party (TPP) chair Ko Wen-je, who won the votes of the young voters in the 2024 presidential election.

The KMT and the TPP have admonished the Lai administration for producing no significant achievement in its first month, for pursuing a “new two-state theory” (asserting that the Republic of China and the People’s Republic of China are separate entities), and for clashing heatedly with the opposition parties. They claim that Lai is using anti-corruption measures to establish his authority, consolidate support within the DPP, as well as eliminate dissidents such as Cheng, a stronger contender and rival for his 2028 re-election bid.

The opposition parties demanded an investigation into why Cheng’s corruption case was halted and who was responsible for obstructing the course of justice in 2017.

No one from within the DPP now dares to publicly support Cheng. They can only argue that they respect judicial independence and oppose any miscarriage of justice or indulgence of the guilty.

This incident has emphasised that law enforcement is impartial to both the Pan-Blue and Pan-Green coalitions. While it has damaged the DPP’s image of “honesty, diligence and love for the native land”, it might prove to be beneficial in the long run.

KMT legislator Hsieh Lung-chieh has long monitored Lai during his terms as Tainan mayor. He accurately predicted three months ago that Cheng would be the first victim to fall after Lai takes office as president.

Hsieh boldly made this prediction after Cheng was excluded from Lai’s initial cabinet lineup. Cheng and Lai, both from the DPP’s New Tide faction, have long been rivals.

Amid the ongoing controversies surrounding Cheng, which contradict Lai’s anti-corruption stance, there is an implication that Cheng is being deliberately singled out as an example.

The DPP’s defeat due to various corruption scandals in the 2022 “nine-in-one” local elections led to then President Tsai’s resignation as the DPP chair. Lai, who campaigned for the role of DPP chair in Tainan in early 2023, publicly demanded apologies from Tainan’s mayor Huang Wei-che and six DPP legislators.

Lai urged for thorough investigations and fair punishment, regardless of party affiliation, for the multiple scandals, including the slag pollution of farmland in Tainan, the Tainan Xuejia 88 shooting case, the solar plant corruption scandal and the vote rigging for the elections of the Tainan city council speaker and deputy speaker.

Su Huan-chih, a former DPP member and former Tainan county magistrate until the county’s merger into Tainan city, told Lianhe Zaobao, “The political speculations might be exaggerated. Lai is not targeting Cheng but merely removing the past eight years of judicial protection for the Pan-Green coalition. By not hindering investigations does not mean that he is orchestrating the case.”

Su adds that the DPP has had complete control for the past eight years, which means that the prosecutors’ appointments, promotions and investigations are politically influenced, and that some cases involving the DPP have been shelved.

Now that Lai demonstrates a different political style and, more importantly, that none of the three parties (the DPP, KMT and TPP) has more than half of the seats in the Legislative Yuan, there is more latitude in Taiwanese politics and greater independence for the Taiwanese judiciary.

Yu Ying-lung, chair of the Taiwanese Public Opinion Foundation and former DPP legislator, told Lianhe Zaobao that Cheng has been keenly watched in the last decade as a promising and prominent political figure in the Tsai administration. His alleged corruption, already known for seven years, only surfaced after Tsai stepped down. Yu said, “This implies a revelation of longstanding political corruption, which certainly damages the DPP government as well as the DPP’s image.”

He added, “Looking on the bright side, the resolve to expose and prosecute senior officials for corruption indicates that the system’s anti-corruption mechanisms remain functional under Lai’s presidency.”

Yu believes that the Tsai administration blocked judicial investigations by using political protection. “This case may be the mere tip of the iceberg. There are many other longstanding cases, for which the truth must be fully revealed for a healthy democracy,” he said.

While acknowledging Lai’s integrity, Su questioned Lai’s commitment to anti-corruption. He says, “The New Tide faction is initially idealistic but has now become an organised politics-business interest group. Lai is not a part of this. Furthermore, since the New Tide faction is further divided into Cheng’s northern group, and the central group that supported Tsai in her re-election campaign in 2019, Lai’s southern group has distanced itself from the New Tide faction.”

“If Lai is truly committed to anti-corruption, he has no reason to oppose the opposition’s push for legislative investigative powers and hearings. He is contradicting himself by opposing these legislative tasks if he wants to differentiate himself from Tsai,” Su added.

Questions remain as to why the Lai administration has only targeted the relatively minor Huaya Science Park case among the numerous allegations against Cheng involving land developments. If Lai is serious about anti-corruption, he must get to the bottom of the various earlier scandals and the recent shootings in Tainan.

The current actions against corruption will help Lai to consolidate power within the DPP. The KMT has realised that Lai’s harsh stance against his own party members implies that he will definitely not be lenient with KMT politicians. This will most likely intensify political conflict and instability in Taiwan.

On the same day that Cheng was investigated, DPP legislator Chen Ting-fei, who has long jostled to be Tainan mayor, was expelled from the DPP faction Taiwan Normal Country Promotion Association for unilaterally registering herself and her team for the DPP Central Executive Committee elections. These two incidents occurred less than a month before the DPP National Congress on 21 July, igniting speculations of factional struggles within the DPP.

The DPP, formed in the 1980s, was made up of opposition politicians and local individuals who had different political ideologies, which later evolved into various factions. From the early Formosa and New Tide factions, the number of factions has gradually proliferated.

Although the DPP National Congress passed a resolution in 2006 to dissolve all factions, it proved difficult to implement. Despite Lai’s announcement in January 2024 to leave the New Tide faction so as to govern fairly and unite and lead the DPP, he is still perceived as the faction’s de facto leader.

Currently, the more active DPP factions include the largest and most well-known New Tide faction, the Ing faction represented by Tsai, the Taiwan Normal Country Promotion Association founded by former Legislative Yuan President You Si-kun and currently led by Foreign Minister Lin Chia-lung, and the Taiwan Forward faction (also known as the Ocean faction) founded by the late media mogul Lin Kun-hai.

Cheng, of the New Tide faction, has been regarded as a key successor within the DPP and rumoured to be a leadership candidate, resulting in tensions with Lai.

However, Cheng is part of the New Tide faction’s northern group and is close to Tsai. Some analysts consider him to straddle both the New Tide and Ing factions. As Lai’s long political career has developed in the southern parts of Taiwan, he is part of the New Tide faction’s southern group.

When Lai announced his cabinet in April, Cheng was appointed as chair of the Straits Exchange Foundation, which handles interactions between the peoples across the Taiwan Strait. This has been interpreted as Cheng being sidelined by Lai.

The KMT has questioned whether Cheng’s corruption case is due to the grudges between Lai and Cheng, arising from their rivalry within DPP’s factional struggles.

During a media conference on 10 July, KMT legislator Wang Hung-wei even suggested that it is a power struggle between Lai and Tsai. Although Cheng’s corruption case had been previously dismissed, the investigation restarted after Lai was elected president last year and smacks of political intervention.

A United Daily News editorial on the same day suggested that Lai is hurrying to maximise his power consolidation and eradicate opposition within the DPP before the party’s National Congress. This would help him in the local and 2028 presidential elections in 2026 and 2028 respectively.

Interviewed academics generally believe that although Cheng’s corruption case does not prove the existence of a political struggle, it will certainly impact the balance of power among the DPP factions.

Chu Chao-hsiang, a council member of the TPP’s Taiwan Origin Brain Trust and retired political science professor from National Taiwan Normal University, was a member of the Third National Assembly alongside Lai in the 1990s.

Chu told Lianhe Zaobao that Cheng, despite being an important member of the New Tide faction, is not the leader. His close relationship with Tsai means that he also straddles the Ing faction. Chu believes that Cheng’s case highlights the power dynamics between the New Tide and Ing factions, in which the New Tide faction will gradually be helmed by Lai’s team and the Ing faction may be marginalised.

Wang Chih-sheng, a political scholar from the Asia-Pacific Elite Interchange Association and who is closely associated with the DPP, noted in his interview that Cheng to some extent represents a link between the Ing faction and the New Tide faction’s northern group. Hence, the two groups’ morale and performance will take a hit.

At the DPP National Congress on 21 July, Lai’s trusted factions including the New Tide, Democracy Living Water Connection, and Green Fellowship Association, secured a majority by winning six seats on the ten-member Central Standing Committee.

How will Lai maintain control of the situation? Chu believes that rumours regarding Cheng’s corruption have persisted within the DPP for several years. He assessed, “Therefore, I do not think that Lai will face repercussions from the other factions after he has settled Cheng’s case.”

However, Chu highlighted that since Cheng’s case came to light, Lai has made it clear that “as long as the law is broken, it will be dealt with regardless of party affiliation or the individual, and the innocent will not be wronged and the guilty not indulged”. 

He also emphasised, “The government is currently focused on the crackdown of fraud, crime and corruption”, implying that there will be further anti-corruption measures within the party.

Chu added that with Lai’s headstrong character, he will be determined to go all the way now that his position within the party is secure.

He said, “Lai will most likely deal with anyone else within the DPP who is involved in bribery and corruption, like Cheng. I can almost say for certain that Cheng will not be the only one.” Doing so will also help Lai to establish his authority in Taiwan as well as confidence in his leadership abroad.

However, Wang believes that the DPP’s culture is “power above all”. Having been elected president as the party chair, Lai’s authority is already supreme and he does not need to purge Cheng to establish his authority. Nevertheless, Wang agreed that if Lai can publicly account for Cheng’s case, regardless of fraud or corruption, he will further win the trust of the people.

This article was first published in Lianhe Zaobao as “党内挥扫贪大刀 赖清德要砍哪儿？”.

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