The controversy regarding the political status of Taiwan (or "Taiwan Issue" as referred to by the Communist Party of China) hinges on whether Taiwan, Penghu, Kinmen, and Matsu should remain effectively independent as territory of the Republic of China (ROC), become unified with the territories now governed by the People's Republic of China (PRC), or formally declare independence and become the Republic of Taiwan; furthermore, on whether its existence and status as a state ("country") is legitimate and recognized by the international community.
Currently, Taiwan, Penghu, Kinmen, Matsu, and some other minor islands effectively make up the jurisdiction of the state with the official name of Republic of China but widely known as "Taiwan". The ROC, which took control of Taiwan (including Penghu and other nearby islands) in 1945, ruled mainland China and claimed sovereignty over Outer Mongolia (now Mongolia) and Tannu Uriankhai (part of which is present day Tuva, Russia) before losing the Chinese Civil War and relocating its government to Taipei, Taiwan in December 1949.
Since the ROC lost its United Nations seat as "China" in 1971 (replaced by the PRC), most sovereign states have switched their diplomatic recognition to the PRC, recognizing or acknowledging the PRC to be the sole legitimate representative of all China, though many deliberately avoid stating clearly what territories they believe China includes. As of 2011, the ROC maintains official diplomatic relations with 22 UN member states and the Holy See, although informal relations are maintained with nearly all others. Agencies of foreign governments such as the American Institute in Taiwan operate as de facto embassies of their home countries in Taiwan, and Taiwan operates similar de facto embassies and consulates in most countries under such names as "Taipei Representative Office" (TRO) or "Taipei Economic and Cultural Representative" (TECO). In certain incidents, Taiwan is also referred to as the Chinese Taipei.
The ROC government has in the past actively pursued the claim as the sole legitimate government over mainland China and Taiwan. This position started to be largely adjusted in the early 1990s as democracy was introduced and new Taiwanese leaders were elected, changing to one that does not actively challenge the legitimacy of PRC rule over mainland China. However, with the election of the Kuomintang (KMT, "Chinese Nationalist Party") back into executive power in 2008, the ROC government has changed its position back to that "mainland China is also part of the territory of the ROC." Both the PRC and the ROC carry out cross-strait relations through specialized agencies (such as the Mainland Affairs Council of the ROC), rather than through foreign ministries. Different groups have different concepts of what the current formal political situation of Taiwan is. (See also: Chinese reunification, Taiwan independence, and Cross-Strait relations)
In addition, the situation can be confusing because of the different parties and the effort by many groups to deal with the controversy through a policy of deliberate ambiguity. The political solution that is accepted by many of the current groups is the perspective of the status quo: to unofficially treat Taiwan as a state and at a minimum, to officially declare no support for the government of this state making a formal declaration of independence. What a formal declaration of independence would consist of is not clear and can be confusing given the fact that the People's Republic of China has never controlled Taiwan since its founding and the fact that the Republic of China, whose government controls Taiwan, is still a sovereign state as established at Nanjing in 1911, but its territory is limited to the province of Taiwan, Penghu, a part of the Nansha Islands and Diaoyutai island. The status quo is accepted in large part because it does not define the legal status or future status of Taiwan, leaving each group to interpret the situation in a way that is politically acceptable to its members. At the same time, a policy of status quo has been criticized as being dangerous precisely because different sides have different interpretations of what the status quo is, leading to the possibility of war through brinkmanship or miscalculation.
Read more about Political Status Of Taiwan: Background, Controversies, Possible Military Solutions and Intervention
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