Deutsche Bank-Asia Macro Strategy Notes TWD Post election thoughts-105950041

DeutscheBankForeignExchangeDateResearch16January2024AsiaMacroStrategyAsiaNotesChinaTaiwanTWD:PostelectionthoughtsTaiwanconcludeditslatestroundofelectionsovertheweekend,withMrLaiChing-PerryKojodjojoeoftheDemocraticProgressiveParty(DPP)winningthePresidencywith40.1%ofStrategistallvotes(5.6m,Figure1),beatingtheKMT’sMrHouYou-ih(33.5%;4.7m)andthe+852-22036153TPP’sMrKoWen-je(26.5%;3.7m).ThemarginofvictoryforMr.Laiwasbetterthaninthelastopinionpoll,thoughnarrowerthanthatforoutgoingPresidentTsaiin2020.ThisisthefirsttimesinceTaiwanbeganholdingdirectPresidentialelectionsin1996thatanypartyhasheldpowerbeyondtwofour-yearterms.NoneofthethreepartiescontestingtheelectionsfortheLegislativeYuanmanagedtosecureanabsolutemajority(Figure2).Itisthefirsttimein20yearsthatthePresident'spartyhasfailedtosecureanabsolutemajorityinthelegislature,andthefirsttimethatathirdparty–TPPwith8seats–getsthebalancevote.Followingtheresults,thenewPresident-in-waitinghastalkedabout"theneedtoworkacrosspartylines,callingforcommunication,consultation,participation,andcooperation,underanewstructureofthelegislature.”ThenewLegislativeYuanwillbeginitssessiononFebruary1stwiththeelectionofanewHouseSpeakerandDeputyHouseSpeaker,whilethenewPresidentwillbeinauguratedon20thMay.Distributedon:16/01/202404:29:08GMTImplicationsforcross-straitrelationsTheelectionresul...