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China can’t afford to invade Taiwan Outright escalation would cripple Beijing

No chance (China Photos/Getty Images)

No chance (China Photos/Getty Images)


August 9, 2022   5 mins

Should Nancy Pelosi have gone to Taiwan? The question might preoccupy America for months ahead of the November mid-term elections. But the truth is her visit did nothing to alter China’s stance towards Taiwan. The Speaker of the House was merely playing a walk-on part in an unfolding geopolitical drama. Another event would have triggered Beijing’s hostile reaction. The pressing question is not about Pelosi — but about what China will — and can — do next.

The live fire military drills around Taiwan that China launched in response to Pelosi’s visit — which included the firing of ballistic missiles over the island — were scheduled to end on Sunday. But on Monday morning, this dress-rehearsal of coordinated manoeuvres for a potential future invasion had shown no sign of stopping. China also announced on Friday that it was cancelling high-level military consultative talks with the United States, and suspending cooperation talks on illegal immigrants, narcotics and climate change, among other things.

We can probably expect military matters to cool off in the coming weeks, ahead of the 20th Congress of the CCP in autumn. But for the moment we can be sure of only two things. First, China is bound to take further opportunities to put pressure on Taiwan using both commercial sanctions and military or diplomatic tactics. Second, for the time being, China is likely to avoid anything that might push its own faltering economy into a tailspin.

Any serious escalation of the tension could have grave implications for Beijing. Not only would it limit or cut off China’s access to semiconductors and Western technology, but it could see Chinese firms subject to further sanctions. It could also compromise trade with China’s biggest markets, namely the United States, the EU and developed Asia. China is dependent on the rest of the world for more than 80% of its semiconductor demand, three-fifths of which comes from the US, Japan and the EU. The Taiwan Semiconductor Manufacturing Company produces almost all of the most advanced varieties.

The Chinese economy, meanwhile, is in bad shape. The target for economic growth this year cannot be met, and the property market, which accounts for over a quarter of GDP, is in disarray. Youth unemployment has shot up to 20%, and the labour market is far weaker than official statistics portray. Zero Covid policies, rigorously pursued both for public health and social control purposes, are stifling demand and turning foreign firms away from future investment in China. The nation’s development model is failing, but the government has no plausible strategies to re-energise it — or at least, none that is politically acceptable.

Beyond its borders, China faces the most extreme challenges since Mao, partly due to the imposition of commercial controls, restrictions and sanctions by foreign governments, and partly because of its own policies of disengagement and self-reliance. Its “no limit” friendship with Russia has only made things worse, and its behaviour towards Taiwan could also go awry. China may end up alienating not just the usual suspects — Japan, India and Australia — but also nations that prefer to stay above the fray, such as South Korea, the Philippines and Vietnam. They could be drawn further into security alliances championed by the United States — which is exactly what China’s Global Security Initiative is meant to stop.

Given these circumstances, there’s little chance China will stage any form of assault on — or wage all-out war with — Taiwan anytime soon. But that’s not to say it will end the so-called “grey-zone” warfare that began before Pelosi’s visit. China could pressure or occupy any of the 100 islands that belong to Taiwan, especially the populated ones in the Taiwan Strait such as Matsu, Kinmen and Penghu, the first two of which are just 10km off the Chinese coast. It could from time to time warn off air and sea traffic in the form of a quarantine, trying to regulate the inflows and outflows of people and goods. In extremis, it might even try to blockade Taiwan, restricting its access to imported energy (which meets about four-fifths of the island’s demand for energy), LNG (which provides most of Taiwan’s electricity), or even certain foodstuffs and raw materials.

The aim would be to force the Taiwanese government to in some way cede autonomy to the CCP. The likelihood of this happening is about nil — and Beijing knows it. Local Taiwanese elections later this year, and national ones in 2024, may further strengthen the country’s backbone and remind Xi Jinping that bullying and coercion are leading China down a blind alley.

At every point, then, China runs the risk of incurring greater economic and political pushback by putting further pressure on Taiwan. As it is, global firms are starting to reconsider their supply chain structures and investments in China, and a deepening Taiwan crisis would create major strategy headaches for foreign firms. No company wants to be caught in the crosshairs of conflicts, sanctions, higher insurance costs and conflicted legal positions. Decoupling, and the rebuilding of global supply chains, are both likely to increase as a result.

For the same reason, China’s desire to de-Americanise its own supply chains, sanction-proof itself, and re-orientate markets towards domestic firms, will likely increase. But following this path would probably take China further away from its quest for higher productivity and undermine the nation’s lofty economic aspirations. Engagement with the global economy was the essential handmaiden of China’s economic eruption; disengagement is likely to reverse that process.

Besides, if China decided to introduce something as severe as a blockade, in an attempt to sap Taiwan’s political will and stifle its economy, it would almost certainly trigger not only sanctions but also resistance. Under the 1979 Taiwan Relations Act, the United States would consider boycotts and embargoes a threat to both global and domestic peace and security. This doesn’t guarantee American intervention to break the blockade, or tit-for-tat measures, but there is a strong chance that Washington would react — and that other Asian nations would fear for their security.

Short of outright invasion, therefore, it does not seem that China could really mount any campaign that would force Taiwan to capitulate. With every move to escalate tension, moreover, Beijing would confront political, commercial and perhaps even low-level military pushback — and significant economic consequences.

But what if circumstances changed? What if Xi went all in, and ordered an assault on the island? Even then, his chances of a successful occupation are slim. Whether China has the military capacity and logistics, now or in the future, is almost beside the point. The issue is whether it has the political will. As we know from Russia, the best laid plans can go awry, and in Taiwan an invading army would meet with spirited local resistance from 23 million people. Suppressing them would make China a pariah state for years, if not decades. The Chinese Dream would become a nightmare.

The CCP has placed huge importance on “reunifying” the renegade province of Taiwan with the mainland, but it would exhaust its political capital by mounting an invasion — successful or not. No one can dismiss the possibility that it might one day happen — especially if domestic pressures caused CCP rule to fray. But the party may well take a leaf out of the Western playbook by kicking this can down a long road, risking unknowable consequences at home.


George Magnus an economist and author of Red Flags: Why Xi’s China is in Jeopardy. He is an Associate at the China Centre at Oxford University.

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Samuel Ross
Samuel Ross
1 year ago

China wants to de-Americanize its supply chain? What a coincidence! We in America want to de-Chinafy OUR supply chain. Gosh, this sounds better when I say it aloud!

Jeff Cunningham
Jeff Cunningham
1 year ago
Reply to  Samuel Ross

The U.S. still has companies making semiconductors? Who? Where?

Brendan Kenny
Brendan Kenny
1 year ago

The equipment manufacturers who have the IP are in the main US ( Silicon Valley ) based. Applied Materials, LAM, ASM, KLA. In addition there is ASML ( Netherlands HQ) and Tokyo Electron. These companies drive the technology, while the likes of Samsung, TSMC, Intel , Micron are the consumers, integrating the various possible solutions into their manufacturing process.

Christopher Bingham
Christopher Bingham
1 year ago

There are five plants being built all around the US as we speak, and Congress just passed legislation giving them billions to make sure they finish. We’re moving the factories back to the US, including the advanced versions that China lost years ago.

polidori redux
polidori redux
1 year ago

I presume that Pelosi’s visit was for domestic consumption. Along with the killing of that terrorist chap whose name escapes me. We live in an age of infantile politics practiced, ironically, by the ancient and just plain senile.

CHARLES STANHOPE
CHARLES STANHOPE
1 year ago
Reply to  polidori redux

Pelosi has made a number of virtually unreported ‘visits’ to Northern Ireland to threaten the UK over the Good Friday Agreement and so forth.
In short she is an octogenarian menace and no friend of the UK.

Jerry Carroll
Jerry Carroll
1 year ago

When they are not drinking — that’s most mornings these days — Nancy and here husband are quite presentable people. It’s lunch you want to worry about. And dinner? Nope, forget about it.

CHARLES STANHOPE
CHARLES STANHOPE
1 year ago
Reply to  Jerry Carroll

How interesting, thank you.

Terry M
Terry M
1 year ago
Reply to  polidori redux

Pelosi’s polititics are repugnant to me. But I must admit I admire her grit in visiting Taiwan and publicly sticking a finger in China’s eye. That the ChiComs could get so worked up about an old, old lady’s vacation plans show China for what it is – an incompetent paranoid clownshow.

Martin Bollis
Martin Bollis
1 year ago

Things aren’t rosy at home so the leadership is unlikely to embark on a foreign invasion 
 which will enable it to shift blame to the pesky foreigners and squash all dissent in the name of patriotism.

Interesting analysis

Justin Clark
Justin Clark
1 year ago
Reply to  Martin Bollis

Yes! Certainly would be a good time for a war (of distraction) – https://youtu.be/yKxBpkbHnpg

Last edited 1 year ago by Justin Clark
Samir Iker
Samir Iker
1 year ago
Reply to  Martin Bollis

And the West still doesn’t get it.
Just because western culture (or at least the vocal, controlling part of it, the academia, media and bureaucrats) has replaced nationalism, religion and family values with more “modern” concepts.

Doesn’t mean that the rest of the world is the same.
Patriotism and pride in one’s own people and culture is still a thing.
That’s why Russia stood up to the rest of the world , sanctions and everything – not because Putin forced them to, but because ordinary Russians would rather bear the pain of war to loss of self respect and suffering injustice.

Similarly, Pelosi’s antics have almost certainly firmed up the Chinese people’s resolve for war. The people, not the scumbags controlling China. It’s not just the leadership using this as an excuse or squashing dissent, though that’s a factor. But ask any ordinary Chinese what they think about Taiwan, and you will get the same attitude Russians had towards Donbass and American meddling in Ukraine.

Last edited 1 year ago by Samir Iker
Andrew Taylor
Andrew Taylor
1 year ago
Reply to  Samir Iker

Da Tavarisch

Jean Daniel Bussieres
Jean Daniel Bussieres
1 year ago
Reply to  Samir Iker

Sadly, I must concur. Any Western criticism of Putin is perceived by many Russians as an infringement of their own human dignity. Likewise, Chinese patriotic culture – carefully nurtured by the Communist Party – predisposes many to regard the Taiwanese quest for independence and Western interventions as an insult to their pride and dignity. 

Samir Iker
Samir Iker
1 year ago

Again, you dint get it. What the Russians perceive as an infringement of their human dignity, isn’t criticism of Putin – that’s what you like to believe.

What they do feel outraged about is when the US block keeps extending NATO to their borders, insult their intelligence by pretending it’s defensive (what were they defending against when expanding in 1999-2001?), support attacks against Russian minorities and organise a coup next door, and then bellitle Russian concerns.

These aren’t make-believe concerns dreamt up by Putin, these are existential questions and insults ordinary Russians would never tolerate.

Diane Merriam
Diane Merriam
1 year ago
Reply to  Samir Iker

By what rationale does Russia have the right to dictate the policies of a dozen or more countries that happen to border it? They don’t like it. Oh well. It’s not *their* country to make the decisions about. Either they are sovereign nations or they’re not. You can’t have it both ways any more than you can be a little bit pregnant.

Andrew F
Andrew F
1 year ago
Reply to  Samir Iker

But Russia attitude towards Donbass is based on lies of Russian propaganda you keep repeating.

There was Ukrainian independence referendum and country voted over 90% for it.
Even Donbass voted over 80% for independence and Crimea 54%.

Just because genocidal Russian Imperialism wants to invade and control sovereign countries does not mean that West should agree to it.

Last edited 1 year ago by Andrew F
Samir Iker
Samir Iker
1 year ago
Reply to  Andrew F

That independence referendum was in 1992.
And the Russians (men like Putin) honoured it.

I am pretty sure being bombed to bits, having their regional political parties banned and Russian language suppressed night have changed a few minds in the Donbass over the past decade or so.

Tina D
Tina D
1 year ago
Reply to  Samir Iker

What a scary, delusional attitude.

Last edited 1 year ago by Tina D
Andrew Stoll
Andrew Stoll
1 year ago
Reply to  Samir Iker

You are insulting the Russian (silenced) majority!

Diane Merriam
Diane Merriam
1 year ago
Reply to  Samir Iker

And what of all those “Russian” speakers that Russia is supposedly protecting by killing them and destroying their homes and cities and towns? This is supposed to make them like the Russians?

David Zetland
David Zetland
1 year ago
Reply to  Samir Iker

You forgot to mention that Russia and China do not allow other voices to be heard. The people in both countries only hear propaganda.
The other point is, in 1932 in Nazi Germany, something like 100,000 people were imprisoned who had been against the Nazis. From 1933 onwards there were very few voices against Hitler. We’ll never know what most Germans really thought about Hitler after that as there were no polls taken and you had to be very brave to dissent.

Andrew Stoll
Andrew Stoll
1 year ago
Reply to  Samir Iker

Let me guess..
You are between 15 and 25 years old and you read all that online or a friend who ‘knows a lot about these things’ told you so?
Sorry, but you are quite wrong here. Find out why – it’s easy!

Michael James
Michael James
1 year ago

Just as Russia would never invade Ukraine.

Fraser Bailey
Fraser Bailey
1 year ago
Reply to  Michael James

I would imagine there were those at the time who said Hannibal couldn’t afford to invade the Roman Empire.

Selwyn Jones
Selwyn Jones
1 year ago
Reply to  Michael James

And just as Europe couldn’t afford a great war – Norman Angell. The usual complacent nonsense. In fact, it is precisely when aggressive countries are faced with the ruinous prospect of a long war that they lurch into a “short” one. Then, they “make sacrifices”.

Alka Hughes-Hallett
Alka Hughes-Hallett
1 year ago
Reply to  Michael James

Precisely.
After doing extensive exercise, against all expectations, Russia invaded Ukraine. Now China is flexing its muscle ( its ego is hurt) trying to intimidate Taiwan. It has two choices, It can back down, loose face, get even more frustrated or it can invade without too much delay & not worry too much about the consequences, blame the US for its actions. They might just invade while the world is still coming to grips with the Russian invasion!

Ian Stewart
Ian Stewart
1 year ago
Reply to  Michael James

And destroyed Russia in the process. Even Xi must be learning from that playbook.

Diane Merriam
Diane Merriam
1 year ago
Reply to  Michael James

And China has learned from that. They both expected (as did much of the rest of the world) that it would be over in a matter of days, weeks at most. Not what happened. And that’s in a country with long land borders and flat, wide open plains. Taiwan is not any more of a pushover than Ukraine has turned out to be. Less even.
Taiwan is behind a moat. Huge losses just in trying to move people and equipment across the water. It’s mountainous, filled with peaks and valleys for partisans to hide in and continue to strike back. Ukraine spent 8 years preparing for this war. Taiwan has been preparing for 70 years.

Rupert Steel
Rupert Steel
1 year ago
Reply to  Diane Merriam

There’s a line of thinking that China will circumnavigate Taiwan, leaving it for absorption after completion of its grand strategy – expulsion of US forces from the western Pacific. The extraordinary build up of the Chinese military in all domains is rapidly giving China a notional supremacy over US forces in the Indo-Pacific. It’s a very serious development, brilliantly analysed by a former Australian general, Senator Jim Molan in his book ‘The Danger on our Doorstep”.

Diane Merriam
Diane Merriam
1 year ago
Reply to  Rupert Steel

China has a lot of boats. Small boats. Ones that can’t operate far from their home ports. Their first aircraft carrier was sold to them, from all places, by Ukraine. It was sold as scrap since it was an old, only partially completed Russian carrier. But the Chinese finished it off instead. Then they built a second one based on the first.
One US supercarrier group could easily take out the entire Chinese Navy. Two supercarrier groups could pretty well take on the combined fleet of every other country in the world. There are only 15 countries that have a bigger air force than is on one supercarrier group. And we have a dozen of them. Not all out to sea at the same time, but plenty of backup if ever needed.
One smallish naval group in the Indian Ocean could destroy China in one year without firing a shot, simply by interdicting the flow of oil to China from the Middle East. India itself could do it.
France has one supercarrier, but it’s been plagued with problems and has never really been functional. England has one working now, but I think it’s still in sea trials on its way over to our side of the pond to replace the first one that’s having some pretty serious problems. That’s it. The rest are all American with more, even larger ones, under construction. One supercarrier is a match to about seven jump carriers, which is all any other country has.
Japan expected to have free rein in the Pacific for a year when they attacked Pearl Harbor. One small piece of bad luck, the fact that the carriers weren’t in port that day, doomed them from that day forward. Midway drove the final nail into the coffin. Millions died before it was all over, but the finale was already written.
Even if China was able to take out the carrier group always in that area, plus Okinawa, CINCPAC would have two more there within weeks. Not to mention having to deal with the Japanese Navy which is not much smaller operationally than the Chinese one. And Korea. And the Phillippines. And Australia. And New Zealand. And a half dozen other smaller navies in the area, all of whom would be threatened by such a move as an invasion of Taiwan. Just as Russia’s invasion of Ukraine triggered the end of the long term neutrality of Finland and Sweden, with them joining NATO, the South Pacific countries would be energized to work together as a group.

James Hankins
James Hankins
1 year ago

Both the Biden administration and the CCP need foreign policy crises now to distract their populations from multiple domestic failures. Not a good outlook.

David Zetland
David Zetland
1 year ago

A couple of destroyers in the Indian Ocean would quickly stop the supply of oil and gas to China from the Middle East. 85% of China’s oil and gas is imported from the Middle East. China is in fact in a very weak position. Then there is China’s huge reliance on imported animal feed, grains and fertilisers.

As for comparing the Ukraine with Taiwan. The Ukraine is very easy to invade; it has almost no barriers to invasion and is flat. Taiwan has a huge moat. The island itself is mountainous and difficult to move across even if the Chinese were able to land.

China is the paper tiger it’s so often accuses other countries of being.

The real reason why China is being so aggressive is that leader for life and true believer in communism, Xi Jinping, is even more isolated than Vladimir Putin. Everyone around him is too scared to tell him the truth because they know what happens to people who do.

Last edited 1 year ago by David Zetland
Ian Stewart
Ian Stewart
1 year ago
Reply to  David Zetland

Spot on. And keeping Xi in power will only continue the rapid decline of China. It looks pretty rosy for the west to me.

Christopher Cuff
Christopher Cuff
1 year ago

I would hope that the experience of Russia in Ukraine might cool Xi ardour for invasion.

Doug Pingel
Doug Pingel
1 year ago

IIRC within about 4 weeks of Russia’s invasion (3 day war!) the Chinese anounced that they were putting any idea of invading Taiwan on the back burner for 4 years.

J Bryant
J Bryant
1 year ago

The author envisages a spirited resistance by the Taiwanese if China invades, but in a recent edition of Will Lloyd’s “Hindsight” here on Unherd, there is a link to an article by Tanner Greer that suggests the Taiwanese, especially the young Taiwanese, are far from being tough, would-be resistance fighters.
https://scholars-stage.org/why-i-fear-for-taiwan/?mc_cid=1511e2a979&mc_eid=904576f59e
So who’s right? I don’t know, and I’m guessing the CCP doesn’t know either, which, I suppose, is the most compelling reason for why China might think twice before invading Taiwan.

Johan Grönwall
Johan Grönwall
1 year ago
Reply to  J Bryant

The chinese, being ethno-centrists, probably look down on taiwanese as something lesser than them. This will lead to the same atrocities we are witnessing the russians commiting in Ukraine. Initially the reaction will be to flee, as did some of the ukranians. But since that is not an option on an island, second best is to fight to the death. Which is what will probably happen when you see what awaits you if you don’t.

Last edited 1 year ago by Johan Grönwall
Norman Powers
Norman Powers
1 year ago

Is that right? I don’t think PRC views ROC as lesser kinds of humans, that’s the point of their whole One China schtick, right? It’s all about reunification, not wiping out “problem populations”. That’s part of why the article argues that the Taiwanese might not fight that hard. It’s not clear that much bad would happen to them except, you know, being ruled by another dictatorship. But a new holocaust, probably not.

Christopher Bingham
Christopher Bingham
1 year ago
Reply to  Norman Powers

Taiwan has been preparing for this war for 70 years, and could have nuclear weapons in a year if they choose to go that route. They have some of the finest engineers in the world. That’s what the CCP wants to control.
Taiwan is no dictatorship. They certainly used to be, but they have elections that actually mean something, and have for quiet awhile.

Diane Merriam
Diane Merriam
1 year ago

A year is too long. If they see forces gathering, I’d say not much more than a month or so for a crude nuclear weapon, but one that will work nonetheless. The basic science and engineering is at a high school level these days. And they have the basic materials from their reactors. They just have to process it, which is what takes most of the time. I wouldn’t be surprised if they have a facility that could be re-purposed for that already. Same for Japan and South Korea.

Last edited 1 year ago by Diane Merriam
Ian Stewart
Ian Stewart
1 year ago
Reply to  Norman Powers

Have you been watching what they did to Hong Kong democrats?

Diane Merriam
Diane Merriam
1 year ago
Reply to  J Bryant

Patriotism goes up by an order of magnitude when a country is invaded.

CHARLES STANHOPE
CHARLES STANHOPE
1 year ago

A major war with China is inevitable. ‘They’ think it is their turn but are wrong, and ‘we’ will have to be disabuse them of that idea, sooner rather than later.
Let them cross the Rubicon and see what happens. “God is on the side of the US Navy”.

Wim de Vriend
Wim de Vriend
1 year ago

God is on the side of the strongest battalions. (according to Frederick the Great, in 1760)

CHARLES STANHOPE
CHARLES STANHOPE
1 year ago
Reply to  Wim de Vriend

He must have pinched it off Voltaire who said something very similar: “God is not on the side of the big battalions, but on the side of those who shoot best”.

Diane Merriam
Diane Merriam
1 year ago

China has been doomed to fall off the demographic cliff for decades. Their population has probably already peaked and could be half of what it is now as soon as 2050. They are one of the fastest aging populations in the world and they won’t be able to do what Japan has done in order to survive.
Xi is out of touch with reality. No one wants to tell him anything. It’s too dangerous. He’s locked up or killed too many of his former “advisors.” The lockdowns from COVID have only sped that process up. Since their “vaccine” has never worked worth beans, even against the original version, and no one has developed natural immunity and Omicron is the most infectious variant yet, well, it won’t take much to go over the edge on that too. I doubt if he really even knows about the droughts and heat and rivers drying up and power generators going down, much less the resurgence of African Swine Fever in their hog farms. China may be buying oil from Russia, but how is it going to get there? There’s only one pipeline. The rest has to come by ship and Russia is having a teeny bit of trouble with shipping oil for some reason.

Alan Hawkes
Alan Hawkes
1 year ago

Perhaps more might be made of the fact that for most of its history Taiwan was not a part of China, and was not considered to be a part of China by the Chinese, until the Qing dynasty invaded in the 17th century, holding it, or at least the lowland areas, until it was ceded to Japan, after losing the Sino-Japanese war in the 1890s.

Ian Stewart
Ian Stewart
1 year ago

Who needs independence to be recognised and embassies in foreign countries when you make the best semiconductors in the world?

A really brilliant strategy from the Taiwanese, as the Chinese strategy moves impatiently from ‘slowly slowly catchee monkey’ to angrily chasing after the monkey, shouting pointlessly.

Diane Merriam
Diane Merriam
1 year ago
Reply to  Ian Stewart

We are in the process of building, or in the planning stages, of chip manufacturing plants that are as good as, if not better than, TSMC’s. But they aren’t coming on line any time soon, and will still need to ramp up to commercial level production after that, so Taiwan is still the only place to go for mass production of top quality chips for at least another ten years or so.

Maureen Finucane
Maureen Finucane
1 year ago

Sooner or later they will invade. Just a matter of time.

Madison Addam
Madison Addam
1 year ago

frwerw4trf

Frank O'Connor
Frank O'Connor
1 year ago

Hard to believe George Magnus, he is probably a propagandist for Us and UK