On August 2, US House Speaker Nancy Pelosi made a controversial visit to Taiwan while on a tour in Asia to show support for US Allies. At the beginning of her trip in Singapore on July 31, there was no mention of a visit to Taiwan. However, speculations intensified during the following days and Chinese leaders urged President Biden to prevent Pelosi from visiting the island, making the US and the world aware of serious consequences that could follow.
Just minutes after Pelosi arrived in Taipei, China announced they would perform live-fire military exercises around the island of Taiwan starting two days later. On August 4 more than 200 Chinese military aircraft and more than 50 warships were seen in the territorial waters surrounding Taiwan, some crossing the unofficial border. In addition, ballistic missiles were launched around and over the island in a drill that lasted until August 8. The exercise was the largest ever by Chinese forces. China was accused by Taiwan’s Foreign Minister Joseph Wu for being in preparation of an invasion.
Following the visit, China imposed sanctions on Pelosi and her relatives and haltered cooperation with the US on a range of issues including climate change, counter-narcotics, and illegal immigration. Moreover, China announced its intent to cancel the Military Maritime Consultative Agreement (MMCA) meetings, which would prevent military communication between China and US, and threaten the “guardrails” between the two countries.
The heightened tensions were still visible last week, when the Taiwan military on Thursday shot down an unidentified drone entering its airspace near an islet off the Chinese coast. Additionally, on Friday the Biden administration approved more than $1.1 billion in arms sales to Taiwan, which is said to be in line with a longstanding US policy of providing defensive weapons to the island. This has further angered China who warned the US it would take counter-measures.
As the two largest economies in the world, the US and China have an important yet competitive relationship. It has been a modern type of competition mostly involving the use of soft power sources such as economic, technological, and ideological influence across the world. This competition seems to have intensified during the last couple of years. In 2018 the Trump administration engaged in a trade war with China, after imposing tariffs and quotas on imports, which seriously challenged the relationship between the two superpowers. The competition between the two seemed to continue with the Biden Administration, which has not yet changed the tariffs on Chinese goods set by Trump. In a speech, the US Secretary of State Antony Blinken stated: “China is the only country with both the intent to reshape the international order and, increasingly, the economic, diplomatic, military, and technological power to do it”. The rivalry is felt in every transaction between the countries, making the relationship a very complex one.
It should be noted, notwithstanding the differences between the two countries, that the US has acknowledged the “One-China policy” since 1979 when formal ties between the two countries were built. The policy states the People’s Republic of China as the “sole legal government of China,” and acknowledged, but did not endorse, “the Chinese position that there is but one China and Taiwan is part of China.” For China, this has been seen as security that Taiwan is to be viewed as a part of mainland China and that therefore the US would not interfere in its internal business. On the other hand, the US signed the Taiwan Relation Act (TRA) in 1979 which provides the legal basis for an unofficial relation to Taiwan that includes arms sales. While the US to this day emphasizes that its long-standing One-China policy is still in effect, it has not taken a formal stance on the question of independence.
The last couple of years has exhibited a shift in American ambiguity. President Trump was seen to question the One-China policy in 2016, yet recommitted to it to maintain good relations with China. In May 2022, President Biden has also shown mixed signals by remaining committed to the One-China policy, yet saying the US is willing to intervene militarily if Taiwan was to be invaded. Furthermore, in November 2021 when asked about Taiwan, Biden said “It’s independent” but later the same day claimed his administration is “not encouraging independence” for Taiwan, which sparks speculations and concerns. The relationship between China and the US is tense and the issue of Taiwan is one of the complex aspects of it.
The last couple of years reveals a change in tone between the West and China. In June 2021, NATO for the first time named China as a security challenge to the Alliance. A year later, the tone hardened even more as China was said to pose a threat to world order, mentioning its growing nuclear forces, hacking operations, and close ties to Russia. This shift in Western relationships vis-a-vis China became even more visible when the latter refused to condemn the Russian invasion of Ukraine and put blame on the West for the war instead.
Following the military response to Pelosi’s visit to Taiwan, more hostilities between the West and China surfaced. In a statement, the Group of Seven (G7) called China’s “aggressive military activity” unjust and labeled it as a risk for destabilizing the region. China on the other hand has repeatedly warned the US to not engage with Taiwan, naming its actions as “playing with fire”, and accusing the US of interfering in Chinese internal affairs.
The importance of Taiwan
The China-US rivalry is a modern form of conflict. It takes place in different realms, ranging from economy to military and ideology, which all puts Taiwan at the forefront. Firstly, Taiwan presents a valuable geopolitical position in the South China Sea. For both the US and China, the island presents a great advantage. As long as maintains good relationships and remains a close ally with Taiwan, the US will have the potential to secure its “first island chain” by protecting this key point. This strategy dating back to the Cold War foresaw becoming allies with the first islands off of the Chinese coast such as Japan and the Philippines as a way to contain the socialist threat in East Asia. If China was to breach this containment, it could gain huge strategic advantages. China would be able to expand its presence into the Pacific Ocean and might even seriously threaten the US military presence in the Pacific such as its military bases on Guam and Hawaii. Nonetheless, China would be more protected from the US influence off its eastern coast and safeguard its sovereignty.
Secondly, the value of Taiwan in this great power competition is not limited to the island’s geopolitical importance. In a white paper document released in mid-August 2022, China presented its plans for “reunification” with Taiwan. China claims that the territory has belonged to China since ancient times which is an “indisputable fact”. Taiwan has become a way for China to reinforce its position as a global superpower and consolidate its power. Furthermore, Taiwan is a rapidly growing economy. It is a top player in the information and communication domain, globally dominating the production of computer ships. As of right now, China is Taiwan’s biggest export partner and the two economies are deeply intertwined. In 2020 China spent more on importing chips than it did oil, which reveals how important the Taiwanese industry is for China. In its white paper, China acknowledges Taiwan’s economic position and sees it as “highly complementary to that of the mainland”.
Thirdly, the ideological battle between China and the US is played out at any moment in Taiwan and the result of this competition is important for the two ideological camps on opposite ends. For American credibility, defending a democratic Taiwan at the risk of falling under an authoritarian regime is crucial. At present, China is ranked as a prominent authoritarian regime in the world. China has already challenged American democracy-based growth by becoming the second largest economy despite being authoritarian. In contrast, the US has a proclaimed role as a defender of freedom and supporter of democratization which puts it in direct contrast to China. Since 1949 Taiwan has been ruled separately from mainland China, building an autonomous democracy. Some experts say this status is critical to understand US involvement. It is a question of morality and international norms. Losing Taiwan, especially through force, would hit at the core of the ideological competition.
It is inevitable to mention the ongoing war in Ukraine when talking about great power politics and territorial conflicts. As the Russian war on Ukraine raged during the spring, attention was drawn to Taiwan in fear that China would make a similar move. Some experts speculate that the risk of invasion has increased while others say the Russian invasion has cautioned China on the global consequences that would follow such an invasion. However, Western leaders have expressed great concerns about the situation in Taiwan. In June, then UK foreign secretary Liz Truss called for faster action to help Taiwan with its defensive weapons. “We need to learn that lesson for Taiwan”, indicating that the West will not allow what happened in Ukraine to happen once again in Taiwan. Australian Prime Minister Anthony Albanese pointed out the similarities in Russian and Chinese expansionism during the NATO Summit this summer, saying it undermines what has historically been the western alliance in the Indo-Pacific. In contrast, the Chinese Foreign Ministry quickly responded, arguing that NATO is trying to launch a new cold war and that they themselves pose systemic challenges to world security and stability. However, the invasion of Ukraine may provide China with some important lessons to learn concerning possible plans to invade Taiwan faster and more effectively. At the same time, the invasion of Ukraine might have cautioned China and prevented a forceful invasion at the moment.
The war in Ukraine has seriously shaken the international rule-based order, creating deeper cleavages among the great powers that take the shape of Cold War-like divides and competition. This is the context where the crisis in Taiwan evolves and today we can see a destabilization of the region. At a time when the US and China take action to tip the balance of power to their own benefit, these saber rattlings become severely challenging as they might turn into direct confrontation.
The Western reaction to the invasion of Ukraine might have emboldened China to show force against Taiwan. Furthermore, the American ambiguity and confusing tendencies to change the policy towards Taiwan may be perceived as a threat to Chinese power and sovereignty, resulting in an escalation of the conflict. However, the stakes are high for all parties involved. Both the US and China are well aware of the consequences of a military confrontation. In terms of a consequent trade war, China as a growing economy would not want to risk being isolated from the Western markets, as Russia has been after the invasion of Ukraine. In terms of applicability, China’s economy has a notably wider reach than the Russian, which might put into question whether similar Western sanctions could be placed and if so, how much harm those could actually cause to both sides.
Given the situation unfolding right now, the status quo is of interest to all parties. With the raging war in Ukraine, a war in Taiwan will put too much pressure on the already divided international community. The current escalation of the conflict in Taiwan needs to be solved through peaceful means, and that puts the burden of a diplomatic solution on the rivals, namely China and the US to prevent another global tragedy.
Betty Wehtje is a research intern at Beyond the Horizon ISSG. She is currently on an exchange programme in Global Studies at the University of California, Berkeley as part of her studies in Peace and Conflict Studies at Lund University.
 The first island chain refers to the first line of islands off of the Chinese coast including the Kuril Islands, the main Japanese archipelago, Okinawa, the northern part of the Philippine archipelagos, the Malay Peninsula and Taiwan. There is also a second island chain which consists of the islands of Japan stretching to Guam and the islands of Micronesia.