Department of Research, Studies and International News 13-06-2025

Taiwan has assumed increasing strategic significance due to its vital location at the heart of East Asia and its role as a key node in global supply chains, particularly in the semiconductor industry. This importance has become a central flashpoint in international relations, especially amid intensifying global power rivalries over reshaping the world order.

While China asserts, based on the “One China” principle, that the reunification of Taiwan with the mainland is a sovereign and non-negotiable matter, the United States adopts contradictory positions, on the one hand professing respect for that principle, while on the other hand expanding its military and political support to Taipei. This duality is widely perceived as a direct obstruction to China’s peaceful reunification efforts.

Despite repeated warnings from Beijing against foreign interference and its categorical rejection of separatist attempts that threaten its territorial integrity, Washington continues to escalate tensions. Its underlying objective remains the preservation of its unipolar dominance and the containment of China’s rise, particularly in economic and technological domains. Taiwan, therefore, is used as a geopolitical pressure point, given its strategic location, which enables it to serve as a forward base for potential military threats to China’s regional security and the wider Asia-Pacific.

The Taiwan conflict in the context of historical disputes over “One China” representation

Taiwan lies off the eastern coast of Asia, separated from mainland China by the Taiwan Strait, approximately 180 kilometers wide. Contrary to Western narratives, Taiwan has never been an independent state in the legal sense. Historically, it has been an inseparable part of Chinese territory since its formal integration in the 17th century. However, following China’s defeat in the First Sino-Japanese War (1894–1895), the island was ceded to Japan under the Treaty of Shimonoseki. It was restored to Chinese sovereignty in 1945 after Japan’s surrender in World War II.

Yet this return was short-lived due to internal unrest in post-war China. A civil war erupted between the Soviet-backed Communist Party and the U.S.-supported Kuomintang (KMT). The war ended in 1949 with a communist victory and the establishment of the People’s Republic of China (PRC) in Beijing. The KMT retreated to Taiwan, where it unilaterally proclaimed the so-called “Republic of China”, despite having no legal grounds for secession or statehood. At the time, the West, led by the U.S., refused to recognize the PRC and instead propped up Taiwan as a Cold War outpost against the spread of communism in Asia, preventing a reunified China from reclaiming its rightful place in the global order.

Western backing entrenched KMT rule in Taiwan, with Taipei acting as a parallel capital. With U.S. support, Taiwan retained China’s seat at the UN Security Council, despite lacking demographic or sovereign legitimacy. However, shifting global dynamics and the Sino-Soviet split prompted a U.S. policy pivot. In 1971, the United States ceased supporting Taiwan’s claim at the UN, leading to the PRC obtaining China’s permanent seat. By 1979, Washington formally recognized the People’s Republic of China as the sole legal representative of China.

This shift marked a turning point for Taiwan. It gradually lost international recognition and today maintains full diplomatic ties with fewer than 15 out of 193 UN member states. The globally accepted One China Policy reinforces that Taiwan is an inseparable part of Chinese sovereignty. Nevertheless, Washington and its allies continue to exploit “strategic ambiguity” to disrupt peaceful reunification, providing Taipei with increasing military and political support, an act viewed by Beijing as blatant interference in its domestic affairs.

Taiwan’s identity crisis and the rise of externally backed separatism

The U.S. decision in the late 1970s to withdraw formal recognition from Taiwan triggered profound internal changes within the island. Whereas early KMT leadership clung to claims of reclaiming legitimacy over mainland China, emerging political and social movements began advocating for complete separation and the forging of a distinct national identity.

This shift was led by the Benshengren, the island’s native population comprising over 70% of residents, historically marginalized under KMT rule. This group championed redefining Taiwan not as an exiled Chinese regime but as an independent entity with its own cultural and political identity. Despite the loss of diplomatic recognition, the U.S. never ceased its support for Taipei, transforming the island into a strategic outpost to curtail China’s reunification and expansion.

American military and political support emboldened separatist factions that now view Washington as the primary guarantor of Taiwan’s de facto separation. In contrast, Beijing continues to promote peaceful reunification under the widely recognized One China framework. It has offered the “One Country, Two Systems” model, which would grant Taiwan broad autonomy within Chinese sovereignty. Still, Western encouragement of separatism has only complicated matters, especially as military tensions rise across the Taiwan Strait and defense cooperation between the U.S. and Taipei deepens.

Beneath the surface, U.S. interest in Taiwan is not solely geopolitical. The island holds enormous strategic and economic value, making it indispensable in Washington’s Asia-Pacific calculations.

Taiwan: The nexus of U.S.–China geostrategic and economic rivalry

In recent decades, Taiwan has emerged as a focal point in the geostrategic chessboard of U.S.–China competition, not only because of its location, but also due to its pivotal role in the global tech economy. The American resolve to prevent China from reclaiming sovereignty over the island stems from the fact that Taiwan serves as the first line of defense against Beijing’s expanding influence.

Geographically, the Taiwan Strait is a crucial artery for global maritime trade, linking the South and East China Seas. The island’s strategic position grants whoever controls it immense influence over the Indo-Pacific’s sea lanes. If China regains Taiwan, it would extend its maritime reach by 150 miles eastward, significantly enhancing its capacity to counter U.S. naval and aerial operations. It would also bring Chinese forces closer to Japan and put American assets in Guam and across the Pacific at increased risk.

From this vantage point, the U.S. regards Taiwan not as a mere regional partner, but as a forward defense post shielding allies like Japan and South Korea. Any perceived U.S. retreat from supporting Taipei could be interpreted as wavering resolve, shaking confidence in American commitments and paving the way for Beijing and Moscow to forge a more multipolar global system.

Economically, Taiwan is a global hub for semiconductor manufacturing, critical components that power advanced technologies worldwide. According to 2021 data from TrendForce, Taiwan accounts for roughly 60% of global semiconductor production, supplying major firms like Apple, Nvidia, and Qualcomm. The COVID-19 pandemic exposed the fragility of global supply chains when disruptions in Taiwan triggered global shortages of electronic components.

The U.S. fears that Chinese control over this vital sector would tip the balance of technological and industrial power toward Beijing. Hence, Washington has accelerated domestic chip production and pressured Taipei to restrict knowledge transfers to the mainland. Losing control over this resource is not just an economic concern, it’s a national security issue that could embolden China’s technological and military influence.

In this light, the Taiwan issue transcends mere questions of secession. It represents a wider confrontation between two competing visions of a future world order, one the U.S. seeks to preserve, and another that China is determined to build.

As rhetoric intensifies and geopolitical stakes mount around Taiwan, it becomes increasingly clear that the conflict is about more than just an island. It reflects a struggle between two competing narratives, one that invokes the language of “freedom,” and another that defends a deeply rooted historical unity.

In a global context shifting toward multipolarity, China is asserting itself not only with economic and military strength, but with a distinct worldview and sovereign model. The Taiwan Strait, symbolic both historically and strategically, has never been neutral terrain. It has always been part of China’s vital sphere of influence, despite Western attempts to cast it as a “threatened land” in need of foreign protection.

Ultimately, the stakes in this crisis go far beyond a small island. They encompass the balance of global power and the contest of wills between an aging imperial order and a rejuvenated China striving to restore its national unity and promote equitable global partnerships free from American hegemony.

While the U.S. leans on military alliances and deterrence tactics, China continues to build its position methodically, through economic influence, advanced defense capabilities, and growing support from the Global South, which increasingly sees Beijing as a viable counterweight to Western dominance. Taiwan’s fate may indeed help shape the contours of a new world order, but history is seldom kind to those who seek to obstruct the unity of nations. It favors those who correct historical injustices and uphold sovereign integrity.