China Navy
Three reasons why China can't afford to invade Taiwan
From microchips to maritime trade, the stakes make military action an economic gamble Beijing can’t take
Zoe Desch
Jun 11, 2025
Taiwan has become a focal point for the U.S.-China conflict, with the Pentagon turning its attention towards a hypothetical conflict with China — referring to it as the “sole pacing threat” — and China continuing combat and blockade drills around the island.
However, despite China’s demonstrations of military power, Taiwan’s unique economic niche and geographic position make it a particularly thorny target for Beijing. The Chinese Communist Party’s legitimacy rests largely on the robust economy it has built, and the direct economic repercussions of an invasion or blockade of Taiwan stand to shatter the foundations of Beijing’s domestic power.
There are three non-military conditions that make a full military assault or blockade of Taiwan a nonviable option for the CCP. First is the global importance of Taiwan’s semiconductor manufacturing base, second is the impact on trade and the shipping industry running through the Taiwan Strait and Luzon Strait, and third is China’s own less-than-favorable economic conditions.
The semiconductor issue
Taiwan is the largest manufacturer of semiconductors in the world. In the fourth quarter of 2024, Taiwan Semiconductor Manufacturing Co. (TSMC) —Taiwan’s largest producer of semiconductors — took a 67.1% market share of all chips globally, and produced nearly all of the most advanced chips. There is no viable replacement for Taiwan’s manufacturing in the semiconductor market; not only does the nation represent a massive share of the chip industry, its infrastructure uniquely supports the scale and quality of production.
https://responsiblestatecraft.org/china-taiwan-2672344549/
