Economic downturn in China might escalate Taiwan Strait tensions, warns U.S. think tank

As per a report from the U.S.-based Council on Foreign Relations, China’s slowing economy might lead to an escalation in Taiwan Strait’s tensions.

The report implies that President Xi Jinping could heighten nationalist sentiments to divert attention from the economic downturn in his third term, potentially escalating disagreements between Beijing and Washington over Taiwan.

China’s economic slowdown, attributed to an aging populace, increased regulation of technology firms, and U.S. restrictions on high-tech exports, might cause President Xi to focus on Taiwan to consolidate his position and the Chinese Communist Party’s influence.

This shift could increase the conflict risk over Taiwan as President Xi considers his legacy.

The report outlines a scenario where China may claim control over Taiwan’s surrounding waters and airspace, resulting in a blockade that could significantly impact Taiwan’s economy.

Any disruption of this blockade by Taiwan could trigger a military conflict.

The report also indicates that should China contemplate an invasion of Taiwan, U.S. military power and the support of its allies could be instrumental in dissuading such action.

In case of U.S. intervention, Japan, with its proximity to Taiwan and U.S. bases, would be a crucial ally.

Furthermore, the report proposes establishing an Indo-Pacific economic coalition consisting of the U.S., Taiwan, Japan, South Korea, Australia, and the Philippines to counter alleged economic coercion by China.

The alliance would constitute about 35% of the global economy.

The think tank calls for a detailed analysis of the potential Taiwan Strait conflicts’ economic impacts on different countries and an educational campaign aimed at the American public.

It concludes that the future of this economically vital region largely rests on U.S.’s ability to deter China and maintain peace in the Taiwan Strait.