It is common knowledge that the Communist Party of China (CCP) views Taiwan as a rogue state within China's greater sovereign domain. By constitutional mandate, China is committed to unifying Taiwan with the mainland by peaceful means or by force.
With Taiwan asserting its independence, an invasion of the island state by China is likely at some point in the future. Some analysts speculate that it could take place in 2027 in conjunction with the centennial anniversary of the People's Liberation Army (PLA). Others believe that a Chinese invasion will not occur within the next decade for three reasons. One, China's economy is in bad shape and Beijing is not in a financial position to finance a war. Two, China's military is not strong enough to face America's barrier of deterrence in the first island chain. Three, China plays the long game and is waiting for America to weaken.
No one knows when China will make its move. But nations are preparing for the eventuality, as they should.
For years, the United States has maintained strategic ambiguity as to whether it will defend Taiwan in the event of an invasion. This ambiguity was broken in September 2022 when President Joe Biden declared that the United States would indeed come to Taiwan's defense.[1] With this, a showdown between the world's two superpowers could very well ensue.
US INDOPACOM commander Samuel Paparo and Philippines chief Gen. Romero Brawner Jr (Source: X)
A War Over Taiwan Will Have Far-Reaching Implications For The Filipino People
ASEAN is expected to maintain neutrality in this possible armed conflict since its member states have interests that they need to protect with both the U.S. and China.
Yet, neutrality is not an option for the Philippines. The Philippines and the U.S. are bound by a Mutual Defense Treaty (MDT) and the Philippines has granted the U.S. access to its airspace, maritime domain, and nine military bases.[2] Hence, the Philippines (along with Japan) would be the de facto launch site of the U.S. military action. Moreover, the Luzon Strait and the West Philippine Sea are expected to be theaters of conflict, thus dragging the Philippines into war.
A war over Taiwan will have far-reaching implications for the Filipino people, its economy, and its future.
Fear of being caught in the crossfire will spark a refugee crisis among Filipinos similar to the Vietnamese refugee crisis of 1975. Those unable to flee from perilous areas will face the loss of livelihood, property, and lives.
The economic impact will be substantial. A war in Taiwan will interrupt the country's strong economic momentum and derail its path toward high-middle income status; China and Taiwan are the Philippine's third and eighth largest trading partners, respectively. Both are integral suppliers of raw materials and intermediate goods. The disruption of trade will affect Philippine manufactures and exports; The humanitarian cost of war will weigh heavy on the Philippines, and this can potentially relegate the country to a debt crisis. The damage to infrastructure and opportunity loss from tourism and investments will be substantive.
The specter of China's successful takeover of Taiwan will pose risks to Philippine security. This is because Taiwan is the strategic and geographical buffer between China and the Philippines. With Taiwan subsumed, the Philippines would become the next target for China's expansionism. Moreover, Beijing's control over Taiwan would increase China's power projection in the region, and this would adversely affect the Philippines' claims over the West Philippine Sea. Worse, Chinese control of sea lanes would put free trade in the Indo-Pacific in serious peril.
Effects On China And Global Players
According to analysts, if the war in Taiwan were to break out today, China would be unsuccessful in its invasion while sustaining enormous damage to both its military and economy.
China's export economy would collapse with the combination of trade sanctions, supply chain disruptions, logistic barricades, and general contraction of global trade. This would result in a spate of bankruptcies among Chinese enterprises. China would also lose access to global finance for which it sources $7.5 trillion a year. This would result in the collapse of the Chinese financial system.
As for collateral damage, China would be left with tens of thousands of dead, wounded, or captured soldiers. Its navy and amphibious force would be obliterated and would take a decade to rebuild. Meanwhile, China would cement its image as a global pariah, a status the U.S. would leverage to isolate her even more.
The U.S. would also sustain some financial and military damage but would recover faster than China. However, it will be among the hardest-hit economies when the global recession takes hold.
Taiwan, as the decisive theater of conflict, would be broken in terms of human casualties, military assets, and infrastructure. The damage would set back the republic by 40 years. Taiwan would struggle to deliver basic services to its citizens immediately after the conflict and would rely on foreign aid.
The effects on the global economy would supersede the Ukraine war. After all, China is ten times larger than Russia and Taiwan is four times larger than Ukraine. Global supply chains would be dislocated with Taiwan being the source of 92 percent of advanced computer chips and China a supplier of most intermediate and manufactured goods. All these will trigger a shortage of food, smart electronics, raw materials, and capital equipment. This will lead to worldwide hyperinflation coupled with a long protracted economic recession. It is expected to set the world economy back 20 years.
The invasion of Taiwan could take place tomorrow or in 2035. No one knows. Yet, one thing is for sure, we must all prepare for it with a sense urgency. Meanwhile, tensions in the region fester.
*Andrew J. Masigan is the MEMRI China Media Studies Project Special Advisor. He is a Manila-based economist, businessman, and political columnist for The Philippine Star. Masigan's articles in MEMRI are also published in The Philippine Star.
