As it happened: William Lai sworn in as Taiwan's new president

Former president Tsai spoke to the BBC weeks before she left office, where she reiterated her stance on the island's status.

There is no need for Taiwan to hold a referendum or declare independence because it is already an independent, sovereign nation, she told the BBC’s Rupert Wingfield-Hayes.

“We are on our own. We make our own decisions; we have a political system to govern this place. We have a constitution, we have laws, we have a military. We think that we are a country, and we have all the elements of a state.”

What they are waiting for, she says, is for the world to recognise it.

Taiwan has just 12 diplomatic allies- and the support it gets from the US, Japan etc is unofficial.

Instead, most of the world's most powerful counries maintain official ties with China, which sees the island as a breakaway province.

Click here to find out more on what Tsai said.

China has been largely silent on Lai's inauguration. But early today, China's Ministry of State Security posted an article criticising "anti-China forces" in the US for "spreading fallacies" that allegedly distort a UN General Assembly resolution which allows Beijing to take Taiwan's seat at the UN.

The article called this a farce of "internationalising the Taiwan issue" and pledged that the national security organs will "resolutely defeat any form of 'Taiwan independence' separatist plot in the covert front'."

The UN General Assembly Resolution 2758 passed in October 1971 states that the People's Republic of China is the only legitimate government of China.

The resolution replaced the Republic of China with the PRC as a permanent member of the UN Security Council.

Tsai Ing-wen, who has just handed over the leadership of Taiwan to William Lai, has said she is confident that Lai and vice-president Hsiao Bi-khim "will lead Taiwan to a better, brighter future".

"I also want to thank the Taiwanese people for their support throughout my time in office. Although no longer president, I will continue to give my all for Taiwan," she said in a post on X.

Tsai had served as Taiwan's president for two four-year terms.

Now as she leaves office, her defence of Taiwan's sovereignty may arguably define her legacy.

Her refusal to acknowledge "the 1992 consensus", the vaguely-worded agreement which says Taiwan is part of "One China", led Beijing to label her a separatist. She has also said China needs to show Taiwan respect and that Taipei will not bow to pressure.

The 67-year-old's strong stance has won her admirers and detractors in equal measure.

Attempts to promote green energy ended with her being accused of nearly causing an electricity shortage, while the offer of two days off a week for all workers was rejected amid allegations of hurting, rather than increasing, workers' earnings and holidays.

Making Taiwan the first Asian society where gay marriage is legal - a move which earned her plaudits around the world - also damaged her popularity at home.

But it seems that her biggest headache - China - was the very thing that helped her decisively win another four years in office in 2020.

Read more about the former president here.

Earlier, President William Lai and Vice President Hsiao Bi-khim joined performers on stage to wrap up today's festivities.

They were seen singing and dancing along, before another fly-over officially brought the inauguration event to a close.

Beijing called him a "troublemaker" and a dangerous "separatist".

Now he is Taiwan's president. It's an unprecedented win for the Lai and the DPP, a party China sees as skirting too close to its unquestionable red line - Taiwanese independence.

Mr Lai has promised that his term will be a continuation of the eight years of his predecessor, Tsai Ing-wen.

However, Mr Lai has long been considered much more of a firebrand than the cautious President Tsai.

So China is unlikely to agree to any dialogue with the new president - depsite his calls for dialogue in his spech earlier. The two sides have had no formal communication since 2016.

How Mr Lai manages Beijing, and how Beijing reacts to him, will determine his presidency.

An eight-course feast which "tells the story of Taiwan" will be served at tonight's inauguration banquet.

The menu features fermented tofu paste, yellowfin bream served with a herb and pepper sauce, and Taiwan's iconic bubble milk tea.

Chef Wes Kuo told local media that the meal is inspired by the cuisines of Taiwan's five major ethnic groups and put together to "showcase Taiwan's identity".

William Lai himself has requested a sweet potato and kumquat roll from a restaurant in his birthplace of New Taipei City’s Wanli district, the local reports said.

Getty ImagesCopyright: Getty Images

Getty ImagesCopyright: Getty Images

If you missed it earlier, here's the moment where Taiwan’s new president called on Beijing to cease “political and military" threats to the island.

Watch the statement - one of the more significant moments from his inauguration speech.

How Taiwan's new president will handle the island’s relations with China is something that will be watched keenly by the Taiwanese public.

Hsu Wei-chuan, a 42-year-old designer, said she hoped that President Lai would follow his predecessor Tsai Ing-wen’s policies.

"Taiwan didn’t [become] worse in the past eight years. During this time, other countries paid more attention to Taiwan and saw us as a full democracy.”

But she believes Lai may adopt a more tough stance towards China than Tsai - something which could attract attacks from the opposition.

Meanwhile, lawyer Hsu Chih-ming said Taiwan had fared quite well under Tsai but added that there is a need to maintain "good communication" with China.

“Lai said he was a ‘practical worker for Taiwan independence’. I hope he wouldn’t emphasise this too much and worsen cross-strait relations. Otherwise all of us wouldn’t be able to escape if a war broke out," he said.

BBC ChineseCopyright: BBC Chinese

In his speech earlier, Lai spoke about fresh investments for major industries such as AI but his biggest challenge may well be increasing jobs and lowering the cost of living.

We reported in January, in the run up to the election, that the Democratic Progressive Party (DPP) came under fire for failing to adequately improve people's lives, especially younger Taiwanese. This then cost them votes in the election.

Rising house prices and rentals, stagnating incomes, a significant youth unemployment rate, and an annual GDP growth hovering around 2% were all concerns.

More than a third of low-wage workers are aged below 30, according to an analysis provided to the BBC by labour expert Lee Chien-hung from the Chinese Culture University.

Read more of our story here.

Taiwan Presidential OfficeCopyright: Taiwan Presidential Office

A colourful extravaganza is unfolding at the plaza outside the Presidential Office as Lai and Hsiao danced on stage to Rainbow, a song by Taiwanese rock duo Power Station, accompanied by all performers involved in the earlier festivities.

Meanwhile the Taiwan air force's Thunder Tigers aerobatics team took to the skies to commemorate the event.

Taiwan Presidential OfficeCopyright: Taiwan Presidential Office

Across the Taiwan Strait, the most trending topic on social media is Iran helicopter crash, instead of Lai's inauguration ceremony.

Three of the top five topics on microblogging site Weibo are about Iran this morning, while no hashtag of Lai or Taiwan appears on the chart.

When searching for a hashtag featuring Lai's name, a message saying the "content of this topic has not been displayed", indicating that it has been blocked by Weibo. A search for a hashtag of Tsai's name yields similar results.

However the BBC found that search results for Lai's name still show results.

President Lai has just concluded his speech.

The inauguration ceremony continues, with the president now receiving a military flyover.

Taiwan presidential officeCopyright: Taiwan presidential office

Taiwan's constitution makes it "clear" that the "Republic of China and the People's Republic of China are not subordinate to each other", Lai said.

"All our political parties ought to oppose annexation and protect sovereignty. And no one should entertain the idea of giving up our national sovereignty in exchange for political power," he said, calling people in Taiwan to "come together to safeguard our nation".

"So long as we identify with Taiwan, Taiwan belongs to us all," he added.

Lai also addressed the economy, which is another of his challenges, as we reported earlier.

The island has benefited from a hugely successful semiconductor industry - and Lai mentioned investments in high tech industries such as artificial intelligence and aerospace, which will depend on advanced chips.

He also hinted at overseas expansion and said the government plans to help local companies find a footing abroad.

But he did not address unemployment or house prices, which cost his party the youth vote in January.

President Lai has in his speech emphasised Taiwan's democracy, adding that the island cannot be "swayed by external forces".

It's a strong message to Beijing - a clear reminder that Taiwan sees itself as distinct from the Chinese mainland.

However, he also said that peace was "the only option" across the Taiwan Strait - something that was widely iterated by his predecessor Tsai Ing-wen.

As we have been reporting, William Lai will have to deal with an increasingly aggressive Beijing that has made incursions into Taiwanese airspace and waters a routine affair.

So how he handles that will determine a lot, both for the region and for Taiwan's relationship with the US.

At home, he faces a divided parliament, where his party is no longer in the majority. An ugly brawl over proposed parliamentary reforms, followed by protests, over the weekend has marred his inaguration already.

Analysts expect this to be a major obstacle when it comes to pushing through legislation on issues like high costs of living, housing prices and unemployment, or even cross-strait relations with China.

William Lai is taking over as president at a challenging time, when the Chinese threat has appeared stronger than ever.

But the BBC has been speaking to Benjamin Ho, associate professor at the China Programme at the S Rajaratnam School of International Studies in Singapore, who says Mr Lai has his hands full on the domestic front too.

"As much as we like to say that foreign policy is a big issue, if you get on the ground in Taiwan, a lot of it is bread and butter issues," he adds.

He cites the high cost of living and the fractious relationship with the opposition as major concerns.

"Notwithstanding whatever problems he may have with Beijing, he also needs to ensure he can take care of his domestic constituents because those are the people who brought him into power."

Lai has called China's military actions and grey zone coercion the "greatest strategic challenge to global peace and stability".

He has called on China to "stop threatening Taiwan politically and militarily".

"I call on Taiwan and China to take on global responsibility of maintaining peace and stability in the region. I call on China to ensure the world is free from the fear or war," he said.

Urging Beijing to "choose dialogue over confrontation", he added "Taiwan cannot make any concessions on democracy and freedom".

Democracy, peace and propersity are Taiwan's links to the world, Lai said.

"As an important link in the global chain of democracies, a glorious era of Taiwan's democracy has arrived."

He continues to talk about how Taiwan has enhanced human rights and "shown the world our values of democracy and freedom", adding how it is the first in Asia to legalise same-sex marriage.

"As we move forward, my administration will continue using Taiwan's democratic vitality as a force for good to promote national development and deepen international cooperation," he said.