Taiwan is working with friendly nations on how to respond to a possible economic blockade by China, a scenario that appears more likely than a direct military attack on the island, according to a senior Taiwanese diplomat.
Chinese military exercises are increasingly aimed at “winning the war without an actual fight,” Taiwan’s deputy Foreign Minister Roy Chun Lee said in an interview. “An economic blockade is, for sure, one of the possible options that China is seriously looking at.”
Lee’s remarks came after the People’s Liberation Army conducted three days of military drills around Taiwan, a response to President Tsai Ing-wen’s travel through the U.S., where she met House Speaker Kevin McCarthy in California. Foreign Minister Joseph Wu told Bloomberg that the intensity of the latest exercises was on a par with Beijing’s reaction last August, when then-Speaker Nancy Pelosi visited the island.
While Beijing and Washington disagree on everything from technology to human rights, China views Taiwan as its territory and a top national security priority. That, combined with President Joe Biden’s repeated vows to defend the island if it’s attacked, have fueled concerns that Taiwan could be the next geopolitical flashpoint after Russia’s war in Ukraine.
Lee said Chinese President Xi Jinping will have to take into account the costs any conflict would have on his nation’s economy.
“A blockade is one of the possible scenarios, but it is actually very costly and risky for any country, especially China, to implement,” Lee said. “Because economic blockades can easily escalate into military confrontation not only between Taiwan and China, but also between China and other trading partners that are doing a lot of commercial activities with Taiwan.”
Over the past two years, Taiwan has been accelerating its efforts to stockpile critical goods and minerals and has introduced new legislation to bolster the island’s resilience. Being ready to respond to a blockade has become a top priority, though planning is currently at an “inception” stage, Lee added.
Some U.S. officials have said China wants to have its military capable of overrunning Taiwan by 2027. Admiral Harry Harris, the former commander of U.S. forces in the Pacific, told Congress in February that the U.S. ignores the prospect of China invading Taiwan within years “at our peril.”
That’s not the message shared by top current U.S. officials, including Director of National Intelligence Avril Haines and Defense Secretary Lloyd Austin, who said they don’t think an attack on Taiwan by China is imminent. But President Joe Biden’s repeated statements that the U.S. would defend Taiwan in case of attack has prompted China to argue that America is abandoning decades of support for the “One China” policy that has guided policy toward the island.
A veteran Chinese diplomat warned this week that unless the U.S. changes its attitude toward the nation, there’s no point in having talks on ways to safeguard the relationship between the world’s two biggest economies. And Zhu Fenglian, spokeswoman for the Taiwan Affairs Office in Beijing, said Wednesday that China’s latest military drills were a stern warning to people in Taiwan advocating independence and “foreign interference.”
“We will take resolute measures to foil any external intervention and separatist behavior, and safeguard national sovereignty and territorial integrity,” Zhu said.
Lee acknowledged that the current tensions over the island could have an economic cost, as companies reassess their investments in Taiwan — the world’s leading manufacturer of high-end semiconductors — or look to diversify operations out of the region.
“There are areas where we are seeing a concern, especially from the private sector and especially from the foreign investor communities,” he said. Yet the data so far don’t show any real impact, he added, and called for more balanced rhetoric about the likely risks.
Lee said he didn’t expect the U.S.-Taiwan relationship to change, regardless of who wins in the island’s January 2024 presidential election or the American election 10 months later. Support for Taiwan is backed by Democrats and Republicans alike in Washington, with congressional action and visits to the island picking up steadily.
The “U.S.-Taiwan partnership is actually a long-term partnership — it’s not about which party is governing,” he said. “There’s also a strong consensus that maintaining a long-term, solid and united partnership with the United States is of critical importance for Taiwan.”
On the economic front, Washington and Taipei have been in talks on a trade framework that isn’t binding and doesn’t include any discussion of market access. But momentum has grown in the U.S. Congress and inside the Biden administration to turn the existing framework into a traditional free trade agreement. Lee said the U.S. should consider such a shift as a “strategic move” rather than a purely economic one.
Whether or not that eventually happens, the two sides are on track to finalize some portions of the talks in the coming months and “by the end of this year, we’re going to see tangible results,” Lee said.
