President Tsai Ing-wen's remarks come after major gains by a Beijing-friendly opposition party in local elections in late November. "The election results absolutely don't mean Taiwan's basic public opinion wants us to give up our self-rule," she said in an 11-minute New Year's address at the presidential office. "And they absolutely don't mean that the Taiwanese people want us to give ground on our autonomy."
China and Taiwan have been governed separately since the Chinese civil war of the 1940s, when Chiang Kai-shek's Nationalists lost to Mao Zedong's Communists. The Nationalists rebased their government to Taiwan, but China insists that the two sides must eventually unite, by force if necessary.
The Nationalist Party, which in recent years has favored closer ties with Beijing, won 15 of 22 major seats in the local elections, reversing an advantage held by Tsai's Democratic Progressive Party. Tsai takes a more guarded view toward relations with China.
"What's really needed between the two sides is a practical understanding of the differences between values, beliefs and lifestyles," she said. China resents Tsai for declining to recognize its condition for dialogue: that each side sees itself as part of one China. Beijing has sent military aircraft near the island, squeezed Taiwan's foreign diplomacy and scaled back Taiwan-bound group tourism.
A New Year's statement from the Chinese official in charge of Taiwan affairs accused Tsai's party of obstruction and deliberate provocation. "The broad masses of Taiwan compatriots are strongly dissatisfied with the hostility caused by the DPP authorities across the Taiwan Strait," Liu Jieyi, the director of the Taiwan Affairs Office, said, referring to Tsai's party by its acronym.
"To achieve the complete reunification of the motherland and the great rejuvenation of the Chinese nation is the common aspiration of all Chinese people," he said in a message published in an official magazine.
Experts say that China will likely offer economic incentives to Taiwanese cities and counties where officials take pro-Beijing views. Tsai warned officials against any reliance on "vague political preconditions" or "forced submission of secret passwords," a reference to giving away secrets.
"We don't oppose normal cross-strait exchanges, and even more we don't oppose city-to-city exchanges," she said. "However, exchanges across the strait need to be healthy and they need to be normal." Chinese President Xi Jinping is expected to give a speech Wednesday aimed at Taiwan on the 40th anniversary of the "Message to Compatriots in Taiwan," a pro-unification statement from China that called for steps to end the isolation between the two rivals.
Tsai would probably condemn any local official talking privately with Xi, said Shane Lee, political scientist at Chang Jung Christian University in Taiwan. "She thinks that's not only immoral but even illegal, because foreign affairs are the power of the central government, not the local government," Lee said.
Lo Chih-cheng, who heads the international department of the Democratic Progressive Party, said Tsai cannot do more with China, because Beijing would credit any progress to the Nationalists. She will do nothing radical to provoke China, but some voters are looking for more action, he said in an early December interview. "People enjoy the status quo, but it's not enough to win the elections," Lo said.
Tsai also announced that her government was introducing a three-year plan to attract Taiwanese investors home from China, where some face import tariffs raised by Washington in the U.S.-China trade dispute.
She said that Taiwan wants China to share data on an outbreak of African swine fever. Taiwanese officials are on alert against any infection on their island, which lies 160 kilometers (100 miles) across the Taiwan Strait.
Associated Press researcher Henry Hou in Beijing contributed to this story.