Saturday, May 27, 2017

Why New Taiwan Dollar is issued in Taiwan and not the Chinese Yuan?

If you are familiar with international law and followed Taiwan closely, you'd know that the Republic of China is a government-in-exile.

Governments in exile are normally not permitted to issue currencies in host territory, even for own use by nationals. Issue of currencies has to be undertaken by government of the host State.

The Republic of China in Taiwan is an exception. Since the territory of Taiwan is not a sovereign State, and the Government of Republic of China has jurisdiction over Taiwan, it has to issue currency for the use of Taiwanese people.

The issue of currency is subjected to the rule of territorial sovereignty. Since the Republic of China does not possess sovereignty over Taiwan, the currency is identified as New Taiwan Dollar instead of the Republic of China Yuan, regardless of how the government like to call the currency domestically.

The case of Taiwan is where a government-in-exile having jurisdiction over its host territory. A government-in-exile will always have no sovereign title over its host territory. The Government of Republic of China exercises governance through military occupation. Even though we see no soldiers on the streets of Taiwan, military occupation continues nominally.

If you'd like to know more about government in exile, there's a book by an international lawyer, Stefan Talmon: Recognition of governments with particular reference to governments in exile.

I have been learning up about the status of Taiwan for the past one year, and writing up my learning into a book.