The authors examine how China might enact a quarantine of Taiwan and the potential U.S. and allied responses to the crisis. This strategic analysis of payoffs and options is intended to add a variety of economic and political moves to calculations concerning escalation. In particular, the authors examine several salient implications related to economic interdependencies and supply chain challenges that would arise with a quarantine scenario.
Implications of a Coercive Quarantine of Taiwan by the People's Republic of China
- How might China enact a quarantine of Taiwan?
- How might the United States and allies respond to the crisis?
China's coercive options for Taiwan range from routine violations of Taiwan's declared Air Defense Identification Zone to a full-scale invasion. Within the spectrum are efforts to isolate Taiwan to prevent it from sending exports or receiving imports. Typically, this would be called a blockade. However, because China does not view the government on Taiwan as sovereign and thus rejects the idea that a state of war could exist, blockade is not the correct term. Therefore, in this report, the authors examine how China might implement a quarantine of Taiwan. Unlike in a blockade scenario, China's goals for the quarantine would not be to completely cut off food and supplies to Taiwan, but rather to demonstrate de facto sovereignty by controlling the air and maritime space around the island, as well as which cargo deliveries, ships, aircraft, and people have access to Taiwan.
Reducing the risk of escalation and increasing the probability of a favorable outcome depends on creating more time and more options for both sides. Neither side can count on a prolonged military campaign ending favorably. Both sides might agree to outcomes below their preferred outcomes, although Taiwan and the United States are hoping for nothing much greater than maintenance of the status quo. But compressed timelines rapidly force decisions that leave neither side significant room for alternate paths; this is a dangerous and unstable set of conditions.
- The economic balance of power between Taiwan and China favors the People's Republic of China (PRC). The PRC is heavily advantaged over Taiwan, and, if the confrontation were to go on for a prolonged period, the PRC would be in a much better position to endure whatever consequences might develop.
- Direct pressure will likely be necessary to break the quarantine. While there may be room to negotiate the movement of particular kinds of commodities, if the PRC declines to allow free shipment, no amount of indirect pressure is likely to result in the PRC abandoning its efforts.
- A counterblockade by the United States against the PRC is unlikely to be successful. The PRC's economy is too large and varied to be quickly affected by a blockade, and any quarantine on Taiwan is likely to have an effect much more rapidly.
- The force requirements for the United States are likely to be heavy. The majority of U.S. reactions require sizeable military forces. This force needs to be available shortly after the United States decides to react if the response is to be in any way effective.
- Realistically evaluate the escalatory potential of asymmetric economic relationships. While Taiwan has a significant role in at least one key component of the global supply chain for manufactured goods — semiconductors — that role does not insulate it from the many other influences that the PRC could bring to bear not just on it but also on the rest of the world. A quarantine would rapidly create shortages, which would likely accelerate the need for the United States to intervene in a direct way. Taiwan is in a far more vulnerable position than the PRC, which could promote instability and escalation.
- Encourage greater diversity of semiconductor production. Taiwan's dominant position in worldwide semiconductor manufacturing makes it more vulnerable.
- Forward deploy U.S. military forces. Whether the United States is principally trying to deter the PRC from initiating a quarantine, actively trying to challenge the quarantine, or actively taking direct action against the PRC homeland, it benefits from already being in position.
- Communicate that quarantine is not a low-risk alternative. Regardless of how it is imposed, such an action is likely to rapidly escalate to use of force.
Table of Contents
A Quarantine of Taiwan and the Challenges of Interdependence
How the PRC Would Impose a Trade Quarantine on Taiwan
Responses: Options and Risks
Findings and Recommendations