China is pressuring Vietnam to “correct the mistake” of allowing Taiwanese firms to fly the flag of the Republic of China at their factories, in its latest move to curb signs of the self-ruled island’s presence overseas.

The comments came after a Taiwanese furniture manufacturer in Vietnam began flying the flag, which Taipei claims as its national banner, at its factory gates to protect itself from anti-China protests.

“There is only one China in the world, and Taiwan is part of China,” said China’s foreign ministry spokesman Geng Shuang on Monday, adding that Beijing resolutely opposed any form of Taiwan independence separatist activities.

“We have taken up the matter with the Vietnamese side, and they have already instructed the relevant companies to correct their wrong practices.”

Anti-China protests in Vietnam have embroiled Taiwanese companies on multiple occasions, most recently in nationwide strikes and demonstrations against a proposed new special economic zones law in June, which began at a Taiwanese-owned shoe factory.

Lo Tzu-wen, the president of manufacturer Kaiser 1 Furniture, told Taiwan’s Central News Agency on Saturday that the Vietnamese government had granted permission for Taiwanese firms to fly the flag to distinguish themselves from Chinese companies.

He said that the firm incurred about US$1 million in losses in the 2014 anti-China protest, triggered by the deployment of an oil rig by Beijing in a disputed region of the South China Sea, killing more than 20 and injuring more than 100 people.

After the protests, Vietnamese authorities granted tax breaks to Taiwanese firms as compensation, and explained that Vietnamese citizens could not tell the difference between Chinese and Taiwanese firms, and had mistakenly targeted the latter.

The Kaiser 1 Furniture “openly and honourably raises Taiwan’s national flag every day”, Lo said.

Photos of the factory gate showed two Vietnamese flags in the centre, flanked by two American flags – the chief market for the furniture manufacturer – flanked again by two Republic of China flags.

“The approval from the Vietnamese government for Taiwanese firms in the industrial estate to fly Taiwanese flags in their complexes is unprecedented,” Lo was quoted as saying. “It is an unexpected outcome from the 2014 violence against China.”

Representatives at Kaiser 1 Furniture could not confirm whether the flag still flew at the factory, or whether they had received instructions from the Vietnamese authorities to take it down.

Beijing has increased efforts to contain what it sees as a rogue island province, leaving Taiwan with less political clout in global affairs. Just last week, Beijing forced nearly all global airline carriers to clarify that Taiwan is part of China.

Taiwan is the fourth-largest foreign investor in Vietnam, according to the latest statistics from Vietnam’s Ministry of Planning and Investment.

Alexander Huang, an international relations professor at Tamkang University, said raising the Taiwanese flag was a form of protection for companies from the island.

“Taiwanese investors must find ways to protect themselves. If Hanoi can’t find ways to protect them, it will not be good for its economy,” he said.

“Clearly the order from Beijing recently has been coercive diplomacy. China has given the directive to eliminate Taiwan’s name from the international arena, to put pressure on them to kneel to China, and let them set the political relationship.”

By Keegan Elmer -The South China Morning Post - August 1st, 2018