The disappointing performance of the DPP in mayoral elections which took place in November 2010 (including its failure to win the Taipei mayoral race) has helped to boost the morale of the KMT as the country prepares for presidential and parliamentary elections in 2012. Nevertheless, the fact that the DPP obtained a healthy level of votes even in the mayoral contests that it lost will have given the party a degree of confidence that its support is strong enough to enable it to win the presidency if it formulates a more moderate national strategy. However, problems of disunity will continue to cost the party support as the country approaches the presidential poll. The fact that the DPP's leader, Tsai Ing-wen, a China expert, was chosen by the party in late April as its candidate for the 2012 presidential election is a sign that the party accepts the need to balance its pro-independence roots with the need to formulate an effective response to Mr Ma's cross-Strait policy.

The results of the next presidential and parliamentary elections will be largely determined by personalities and national issues. Recovery following the 2008-09 global financial and economic crisis has revived Mr Ma's popularity, and basic economic issues will be the main factors determining the KMT's fortunes. Much will also depend on the perceived benefits for Taiwan of the ECFA with China and on how Mr Ma handles cross-Strait relations. If voters decide that Taiwan's sovereignty has been placed under threat by Mr Ma's policies towards China, support for the president and his party will evaporate quickly. It appears more likely, however, that improved relations with China will result in greater political stability in Taiwan and that this will allow the KMT to focus more closely on economic issues, especially as the DPP seems to be moving slowly towards a rapprochement of its own with China. The Economist Intelligence Unit's central forecast is that the KMT will retain control of both the presidency and parliament in 2012, although its legislative majority is likely to be trimmed.