Chinese Invasion of Taiwan Could Result in Dramatic Sanctions, Think Tank Says

A Chinese invasion of Taiwan, or any other type of “conflict” initiated against the island by Beijing, would have “immediate and dramatically negative effects on China’s ability to import and export goods” and would spur a range of international sanctions, the Center for Strategic and International Studies said in a Nov. 22 report. CSIS said the U.S. and other Western countries would impose strict sanctions and export controls against China, which would “probably persist for months or perhaps years after a conflict, even if U.S. military forces are defeated” in the case of a war.

In Washington, Tokyo and some European capitals, “there would be little to no political appetite to resume normal economic relations with a belligerent China,” the report said. “Both sides would suffer, but China would suffer more.” But the report added that China would “struggle to overcome technology export controls and sanctions based on the global dollar network, upon which its remaining trading partners would also remain reliant.”

Even if China seized Taiwan and its advanced semiconductor manufacturing capabilities, much of the island’s infrastructure, including its ports, would likely be damaged, CSIS said, either from combat or “sabotage.” This “would halt Taiwan’s microchip exports, of which roughly 60 percent go to China as inputs into electronics that are then exported to the rest of the world,” CSIS said. The island’s economy would be “shattered and cut off from most trade, losing the ability to export the majority of the world’s semiconductors and microchips.”