The next presidential election in Taiwan is scheduled for 14 January 2012, and the race is extremely tight. Regardless of the outcome, the election will have a significant impact on the cross-strait situation and on US interests.

Most polls show Ma with a slight lead over Tsai Ing-wen, the Democratic Progressive Party (DPP) candidate. But the decision by James Soong to run as a third-party candidate for the People First Party has further complicated forecasts of the election results. Although most polls suggest that Soong will draw an equal number of votes from both of the other candidates, he will more likely siphon votes from Ma and tip the results in favour of Tsai. In the 2000 elections, Soong also ran as a third-party candidate, splitting the pan-Blue vote, enabling Chen Shui-bian to win with only 39.3 per cent of the vote.

If President Ma is re-elected, he is likely to win by only a slim margin. Although Ma has publicly tabled the possibility of signing a peace accord with Beijing in the coming decade, the absence of a domestic consensus on Taiwan’s relationship with the mainland is likely to make such talks difficult — if not impossible. Chinese leaders will likely be preoccupied with the succession for a year or two, but subsequently may become impatient to reach an agreement that would rule out independence for Taiwan or even press for progress toward reunification.

A victory by Tsai Ing-wen would create different challenges. Tsai is unlikely to accept the two pillars on which mainland China has based its willingness to engage with Taipei: the 1992 Consensus — the formula that made possible the historic Singapore talks between Taiwan and the mainland in 1993 and represents an understanding that there is only one China, though disagreement persists on how to define it — and opposition to Taiwan’s independence. As the election draws near and Chinese fears of a DPP victory increase, mainland officials are warning explicitly that rejection of the 1992 Consensus by a DPP president will result in suspension of cross-strait negotiations.

Beijing is extremely suspicious of Tsai, due in part to her role in former President Lee Teng-hui’s administration as head of an advisory group that suggested in 1999 a ‘special state-to-state’ relationship existed between mainland China and Taiwan. Some mainland Chinese scholars warn that a DPP victory could embolden domestic critics of Hu Jintao’s policy of pursuing ‘peaceful development’ in cross-strait relations to push for a tougher approach. Such a development on the eve of the mainland’s leadership transition could influence personnel arrangements and policies of the new leadership. But it is notable that despite such warnings there have been no hints in either public or private statements about taking military action against the island.

Still, a Ma victory is Beijing’s preferred outcome. Even if no substantial progress toward reunification is achieved in a second term under Ma’s rule, mainland officials are confident that cross-strait relations will at least be stable and predictable, enabling Beijing to focus attention on other pressing matters. President Hu’s ‘peaceful development’ policy would also continue, allowing for increased cultural and educational exchanges alongside expanded economic cooperation. A Kuomintang win would also leave China with important decisions to make, like whether to press for political talks and whether to respond positively to Ma’s demands for greater international space, economic cooperation agreements with other countries and reductions in Chinese military deployments opposite Taiwan.

Much is also at stake for the US. Washington has a strong interest in seeing Taiwan’s democracy continue to flourish and in the conduct of free and fair elections. Taiwan is a vibrant democracy that is widely viewed as a vanguard for political development in Asia — and a model for China in particular. At the same time, the US has an equally compelling interest in the preservation of cross-strait stability. The tensions that prevailed in relations between Taipei and Beijing beginning in the mid-1990s until 2008 were profoundly contrary to US interests. So, Washington is ambivalent: it prefers not to interfere in Taiwan’s elections, but also insists that Taiwan’s leaders manage ties with Beijing in a way that minimises friction and reduces the possibility of military conflict.

Regardless of who is elected in January, the US will likely maintain its important unofficial relationship with the government and people of Taiwan and abide by its commitments under the Taiwan Relations Act. Arms sales to Taiwan are also likely to continue, although advanced-weapons requests from Taipei are expected to be increasingly controversial as the cross-strait military balance shifts more decisively in Beijing’s favour and as China’s national power grows.

Bonnie S. Glaser is a Senior Fellow in the Freeman Chair in China Studies at the Center for Strategic and International Studies, Washington, DC and Senior Associate at the Pacific Forum CSIS. Brittany Billingsley is a Research Associate and Program Coordinator in the Freeman Chair in China Studies at CSIS.

This article is a summary of a newly released report, ‘Taiwan’s 2012 Presidential Election and Cross-Strait Relations: Implications for the United States.’