Denmark and Taiwan – Edging Closer?

In the first week of 2023, former Danish Prime Minister and NATO Secretary-General Anders Fogh Rasmussen visited Taiwan. The aim of the visit was to encourage other democracies to also show more support for Taiwan’s autonomy and to strengthen EU-Taiwan relations. In a meeting with Taiwan’s president Tsai Ing-wen, Fogh Rasmussen underscored his strong support for Taiwan’s right to “exist in freedom and peace”. He also reaffirmed the island’s right to self-determination and pointed out Taiwan’s impressive democratic transformation during the last 30 years. Although the visit may appear indicative of more comprehensive changes in Denmark-Taiwan relations, Copenhagen will likely continue moving closer to Taiwan within the confines of its “One China” framework.

During the trip, Fogh Rasmussen formally represented his foundation, the Alliance of Democracies Foundation, and therefore did not express the kingdom of Denmark’s interests or political stance on the question of Taiwan’s de facto independence. Denmark’s newly elected foreign minister, Lars Løkke Rasmussen, reacted to the visit in an interview with the Danish news outlet, Altinget, reaffirming that the visit is not ultimately indicative of his government seeking to change its foreign policy stance on Taiwan.

Løkke Rasmussen’s statement notwithstanding, both Danish politicians and news outlets have been increasingly inclined to raise awareness about Taiwan’s situation and China’s intensified aggression toward the island. Discussions primarily revolve around the status of the Taiwanese military and whether or not the United States would intervene militarily to defend the island against a Chinese invasion. As international patterns are changing–with Russia’s invasion of Ukraine and an intensifying Sino-American hegemonic competition–Danish foreign policy towards China and Taiwan too appears to be undergoing changes.

Denmark’s “One-China” and Trading with Taiwan

Under its “One China Policy”, Denmark does not formally recognize Taiwan as a sovereign state. Nonetheless, the Nordic nation maintains extensive trade and business relations, not least since the opening of the Trade Council of Denmark in 1983 in Taipei. The council provides commercial counseling to companies with the objective of strengthening bilateral trade ties below governmental level. In March 2022, these business relations between Denmark and Taiwan further expanded when the Taiwanese government introduced its “2050 net-zero emission roadmap”.

Aimed at increasing Taiwan’s share of renewable energy to 60 percent by 2035, the Taiwanese government requested expertise from renowned Danish energy companies. Energy giant Ørsted, alongside Danish manufacturer Vestas and German counterpart wpd, subsequently constructed Taiwan’s first commercial-scale offshore wind farm. As a result, the two Danish corporations hold roughly half of all shares of Taiwan’s burgeoning wind energy market. Renewable green energy currently makes up about 59,3 percent of Denmark’s total energy market. As the current Taiwanese government continues pushing its green transition and desire for greater energy self-sufficiency, existing partnerships such as with the Danish energy providers could evolve into a platform for further non-political cooperation between Denmark and Taiwan.

Future of Bilateral Relations

Even though Danish enterprises are expanding their business relations with Taiwan, bilateral relations with the self-governing island continue to be approached under Denmark’s “One China Policy”. The resulting unclear status of Taiwan has been used to appease China by not going against its core interest of unifying the island with the mainland, thereby maintaining a status quo through delicate balancing. Yet, China’s rise and subsequent power in the international system coupled with Taiwan’s commitment to democracy and crucial role in semiconductor production have made such balancing increasingly challenging.

This development, in turn, holds the possibility of further negatively affecting Denmark-China ties. The Danish business community, which wields significant influence on Danish politics, is concerned about the implications potential criticism of the Chinese regime may have on their trade opportunities. The worst-case scenario being that Beijing could opt to invoke trade sanctions as a punitive measure. With China accounting for about 6.1 percent of Denmark’s total trade volume, the detrimental risk of sanctions to Denmark’s economic prosperity would probably, nonetheless, be manageable in the long-run.

The Security Angle

According to the Ministry of Foreign Affairs’ “Danish Security and Defense Up Until 2035” published in October 2022,  Denmark’s national security is increasingly linked to the security of its allies, in particular to NATO and the European Union. The report asserts that from now until 2035, Denmark faces no existential security threats toward its sovereignty. Yet, due to Denmark’s size, its security is deeply anchored within the wider EU, NATO, and U.S. security environment, making it more vulnerable to external security decisions by these actors. That such reassessments can have an impact beyond the initial actor has been particularly palpable following NATO’s decision to classify China as a systematic challenge.

Additional pressures arise from the U.S. shifting their military priorities away from Europe and towards Asia, pushing Denmark to evaluate its own potential course of action in case of an escalation in the Taiwan Strait. Until recently, Denmark partially refrained from criticizing China due to fears over economic retaliation. Meanwhile, however, there is a growing consensus among Danish officials that China’s current actions towards Taiwan are unjustifiable. A Chinese invasion of Taiwan could, therefore, upend the current status quo of maintaining working ties with Beijing. Taking into account Denmark’s value-based foreign policy, it would likely support Taiwan due to its democratic practices, as seen in the case of Ukraine.

Yet, beyond the recognition and condemnation of Chinese actions, it would likely hinge upon NATO’s response to the situation for the Danish government to determine whether to contribute militarily, under its responsibilities under Article 5. According to U.S. and Taiwanese officials, a Chinese invasion of Taiwan is increasingly likely to take place within the next ten years, and Denmark will probably remain committed to the status quo relationship with Taiwan until then.

Following Fogh Rasmussen’s visit to Taiwan, Beijing’s news mouthpiece Global Times did not forget to strongly comment on the issue. A stern editorial warned against foreign nations interfering in Taiwan affairs because it is a core interest of China’s domestic policy. Further Danish attempts to visit the island with the aim of strengthening Denmark-Taiwan relations were also unequivocally advised against as it inevitably would harm Denmark-China relations. In spite of this, as Lars Løkke Rasmussen noted, the Danish government will not prevent Danish politicians from going to Taiwan. In addition, some Danish politicians has emphasized that any future trips to Taiwan should be for “serious and factual” reasons so as to avoid upsetting China, which is a very fine line to walk. Consequently, it appears likely that Denmark will build on strengthening relations with Taiwan within the confines of its “One China Policy” for now.