“If [China] does significant missile tests, for instance, in the Taiwan Strait, it essentially closes down the Taiwan Strait to international shipping because of military exercises, then, of course, that will ripple through global supply chains, given how reliant companies around the world are for Taiwanese inputs, above all semiconductors,” CFR’s David Sacks tells Yahoo Finance Live.
“Beijing is calculating what military manoeuvres they can do to express their maximum displeasure and at the same time maintain China’s ability to control the escalation dynamic,” the International Institute for Strategic Studies’ Meia Nouwens tells the Financial Times. “I don’t see the connection to an invasion scenario—I think Beijing is still trying to avoid open conflict.”
This Backgrounder explains why China-Taiwan relations are so tense. |