China’s stance on Taiwan threatens global collapse

China’s increasingly aggressive stance toward Taiwan risks a risk if President Xi tries to invade the island.

At a Chinese Communist Party (CPC) congress last week, Xi said the government would “never promise to give up the use of force” to reunify Taiwan with the Chinese mainland, although he added that he would continue to “pursue the prospect of a peaceful “unification”.

Alicia Cairns, chair of the House of Commons foreign affairs committee, warned that Xi’s words meant Britain “must be prepared for more severe provocations on Taiwan”.

The Tory MP added: “We cannot naively wish for the possibility of military action.”

Analysts and politicians have warned that the invasion would trigger an international political and economic crisis even worse than the war in Ukraine, with the US potentially drawn into a confrontation with China after earlier commitments to defend the island.

Tensions escalated in August when Nancy Pelosi, the speaker of the US House of Representatives, visited Taiwan, angering Beijing, which responded with large-scale military exercises and missile tests near the island.

And last month, President Biden said that US forces would defend Taiwan in the event of a Chinese invasion.

Tory MP Bob Seeley, a member of the foreign affairs committee, said any invasion of Taiwan would cause “an extraordinary shock not seen since the First or Second World Wars”.

That sentiment was echoed by Rory Green, chief China economist at forecast consultancy TS Lombard, who said the outbreak of war would be a “major disaster” for the economy, worse than Covid-19.

Of particular concern is Taiwan’s computer chip industry, which dominates the global market.

Taiwan Semiconductor Manufacturing Company (TSMC) has an effective stranglehold on the sector, producing more than half of the world’s computer chips, more than triple the amount produced by its closest rival, South Korea’s Samsung.

There are fears that China will use the invasion to take control of vital technology, while any damage to TSMC’s factory during the conflict will lead to supply shortages and jeopardize the production of everything from cars to smartphones.

A report released last night by the Henry Jackson Society (HJS), a foreign policy and national security think tank, warned that Beijing’s growing military presence in the Taiwan Strait – the 110-mile stretch of water that separates the island from the mainland – risks escalating hostilities and “chaos” on global supply chains.

He also urged the government to reduce its reliance on China so that sanctions could be imposed while “minimizing the damage to the UK economy”.

Tensions escalated in August when Nancy Pelosi (pictured), the speaker of the US House of Representatives, visited Taiwan, angering Beijing

Britain has already taken steps to reduce the influence of Chinese companies, notably by restricting the use of technology developed by telecoms giant Huawei on UK broadband networks.

But it still depends heavily on the country in trade. In June, figures from the Office for National Statistics (ONS) showed that the UK imported almost £64 billion worth of goods from China last year, making it the UK’s biggest import partner.

Seeley warned that more work was needed to move UK supply chains away from China. “Now we need to get rid of this ridiculous economic dependence on an increasingly dictatorial one-party state.”

He added: “We are putting ourselves in danger.”

Taiwan broke away from mainland China in 1949 when Chiang Kai-shek’s Nationalist forces fled to the island to escape the advancing Communist army of Mao Zedong.

Since then, it has effectively functioned as an independent country, although it remains unrecognized by many countries due to diplomatic pressure from Beijing, which considers Taiwan part of its territory.

Reunifying the island with the mainland is a key part of Xi Jinping’s “great rejuvenation” plan by 2049, the 100th anniversary of the founding of the People’s Republic of China.

But speculation is growing that the invasion could come soon after congress delegates last week gave Xi an unprecedented third five-year term as China’s leader, while a reshuffle left the top ranks of the government packed with loyalists, meaning , that there will probably be little resistance to his ambitions.

The HJS said that this consolidation of Xi’s power and the rise of authoritarianism in Beijing made it even more important for the UK to break away from China’s influence.

“Reducing the UK’s economic dependence on China is long overdue,” HJS added.