From Wu's Wikipedia page
For a Taiwanese to switch citizenship to mainland China is huge. The Taiwanese consider themselves a big step up. It would be like an American trading his citizenship to Mexico. For Wu to have done that, the difference in state subsidies must have been night and day.
In 2011 Wu applied for and obtained citizenship of the People's Republic of China. Ostensibly, Wu did this, to allow himself to compete in more international events.
Wu stated the decision was made for sporting reasons and should not be regarded in a political light.
As of April, 2011, Wu has not given up his Republic of China nationality.
Republic of China Deputy Minister of the Interior Lin Tzu-ling stated that "An ROC national who wants to give up his or her citizenship must go through certain procedures.
So far, I do not think we have received any application from him (Wu) to do so".
The Minister noted that “As long as he is still an ROC national, he will be drafted into the military if he comes back to Taiwan.” The Republic of China's Act Governing Relations between the People of the Taiwan Area and the Mainland Area stipulates that both the “Taiwan Area” and the “Mainland Area” are parts of the ROC, and the “Mainland Area” is legally defined as “ROC territory outside of the Taiwan Area.”
In addition, the law does not recognize PRC citizenship and defines PRC citizens as “people of the Mainland Area” who “have household registration in the Mainland Area.” Article 9-1 of the same law prohibits “the people of the Taiwan Area” from obtaining household registration in “the Mainland Area,” those who break the law are banned from voting and serving in office, while their household registration in “the Taiwan Area” is annulled.
I heard that Wu had suffered some sort of physical ailment that would have made him feel uncomfortable in the military, and that was a factor in his decision to become a PRC citizen. This has not been verified to me first hand.