May 18, 2021
China Has No Intention of Walking Away from Its Claims on Taiwan
Xi Jinping has pledged to invest $1.4 trillion through 2025 in key technologies including semiconductors. Of course, another way of leveling the playing field would be to invade Taiwan.
by Scott B. MacDonald
There is a global shortage of semiconductors or chips, which is being felt by the producers of everything from smartphones and electric vehicles (EVs) to washing machines and toasters. Although it is not obvious to see how the fate of the lowly toaster can have geopolitical consequences, the chip shortage is having an impact, especially as it ties into what is emerging as a new Cold War between the United States and China. Part of the reason for this is the role of Taiwan, home to one of the world’s leading chip-markers, Taiwan Semiconductor Manufacturing Company (TSMC). China regards the island as a breakaway province. For its part, most Taiwanese think of themselves as a separate nation, with a democratic and market-oriented development path. Beijing’s crushing of Hong Kong’s democracy movement over the last two years has only reinforced that sentiment. Considering the centrality of chips to the modern global economy, control over chip production has become a major geo-economic factor and raises political risk from China. Any Chinese move to “reunify” Taiwan with the mainland would have implications well beyond the structure of East Asian geopolitics; it also points a gun directly into the guts of the global economy and involves the United States.
Semiconductors or chips have become a core component in the global economy and the key to the production of phones, tablets, computers and automobiles. Companies impacted by the current chip shortage include Apple, Microsoft, Ford, General Motors, and Volkswagen. As supplies are lagging in demand, the lead times for new orders have grown longer through 2020 and 2021.
https://nationalinterest.org/feature/china-has-no-intention-walking-away-its-claims-taiwan-185495
