Taiwan, an economy comparable in size to Poland, is making a bold attempt to join the International Monetary Fund (IMF), a global organization with 190 member countries that provides emergency loans and financial support.
According to the Taipei Economic and Cultural Representative Office in Washington, which acts as Taiwan’s unofficial embassy in the U.S., “Taiwan’s membership at the IMF would help boost financial resilience.” This initiative is part of a broader strategy to elevate Taiwan’s international standing. The island is also aiming to take part in the U.N. World Health Organization’s World Health Assembly and to join Interpol, with backing from the U.S. and its allies.
However, China, which views Taiwan as a breakaway province and has vowed to annex it, has obstructed these endeavors, asserting that it represents Taiwan in global forums. Currently, the IMF refers to the island as “Taiwan Province of China” in its documents.
In 2020, former President Donald Trump enacted legislation establishing U.S. policy to advocate for Taiwan’s membership or observer status in international bodies like the IMF.
The U.S. State Department emphasized that the global community would benefit from Taiwan’s knowledge and resources in addressing pressing challenges. It pledged continued support for Taiwan’s membership in organizations where statehood isn’t a prerequisite and encouraged meaningful participation in groups where full membership isn’t feasible.
The IMF declined to comment on Taiwan’s membership efforts. The U.S. wields significant influence within the organization, while China holds more voting power than any country except the United States and Japan. Bo Li, a former vice governor of the People’s Bank of China, is currently the IMF’s deputy managing director.
Taiwan’s push for IMF membership aims to safeguard the island, which operates under democratic governance, from potential financial aggression by China, which is intent on seizing the territory, potentially through military means.
As concerns grow over a potential military conflict in the Taiwan Strait, analysts warn that Beijing might initiate economic and cyber warfare to force Taiwan’s capitulation. A report from the Taiwan Academy of Banking and Finance cautioned that China might attempt to destabilize Taiwan’s currency by making large bets against its stock market and manipulating foreign exchange rates. Gaining IMF membership would provide Taiwan access to a contingency fund to fortify its defenses.
Recently, the U.S. House of Representatives passed a bill directing the country to advocate for Taiwan’s inclusion in the IMF. This legislation reflects bipartisan apprehension regarding Beijing’s escalating threats to Taiwan, a crucial hub for global computer chip production.
Rep. Patrick McHenry, a Republican from North Carolina and chairman of the House Financial Services Committee, argued in January that the U.S. should address not only military threats from Beijing but also assist Taiwan in strengthening its financial defenses. “As one of the world’s most advanced and innovative economies, Taiwan should be included under the fund’s activities,” McHenry stated.
While Taiwan lacks a seat at the United Nations, Rep. Young Kim, a Republican from California, pointed out that Kosovo is an IMF member despite not being recognized by the U.N.
