A new narrative is gaining ground, stating that China is likely to invade Taiwan in the near future. The reasoning is straightforward: The Trump administration’s tariff war, and the potential decoupling of the Chinese and U.S. economies, is removing the main reason China has long had for holding back in the first place. Without access to the lucrative U.S. market, China has little left to lose, and will thus finally unleash its imperial ambitions on its smaller neighbor.
This view is mistaken. Despite what some U.S. politicians seem to think, the United States is not the beginning and end of China’s foreign economic relations. In fact, China’s largest trading partner today is the European Union. The U.S. is close behind, but then again so is the combined weight of Japan and South Korea. The countries of Southeast Asia, meanwhile, are together a larger export destination for China than either the U.S. or the EU. None of these actors is as invested in Taiwan’s future as the U.S. is, but neither are they indifferent to war and peace and the breakdown of global order. With an escalating trade war with the United States, China needs stability in those relationships more than ever.
China’s key consideration, however, is not economic but strategic. It is the historic shift now underway in geopolitical alliances, and how it affects China’s options and strategies going forward. The Trump administration is not only tearing at the fabric of the U.S.-led economic order; it is also fatally undermining the military alliances that his predecessors have spent decades to build. Xi Jinping has no reason to interrupt him. In fact, China’s path forward as a rising great power has never looked smoother. To fully appreciate the magnitude of China’s improved position, it is useful to briefly review U.S. grand strategy until now.
Since the United States started viewing China as a serious geopolitical competitor in the 2000s, it has pursued a dual strategy of constructive engagement on the one hand, and strategic containment on the other. By integrating China into the liberal world economy, the U.S. hoped to socialize China into an acquiescent democracy, while tapping into its economic resources. Although the former failed dismally, U.S. corporations made untold billions and U.S. consumers got used to spending beyond their means, thanks to the exorbitant privilege of the U.S. dollar.
As China’s wealth, power, and ambitions kept growing, however, U.S. strategy tilted ever further toward strategic containment. The United States sought to reinforce its alliances in China’s immediate neighborhood as well as globally, while cultivating more neutral countries on China’s periphery. The aim was to buttress the primacy of the U.S.-led economic and military order, while throwing a wrench into the works of China’s global ambitions. At key moments, the U.S. has pressured its allies – from Europe to Asia to Oceania – to abstain from joining China-led institutions and agreements, or from collaborating with China in sensitive areas. The aim has been to frustrate China’s attempts at regional or global leadership, while blocking, or at least slowing down, its acquisition of the most cutting-edge technologies.
This strategy, of course, relies on the willingness of U.S. allies and partners to play along. But given the depth of China’s economic integration with both Europe and the rest of East Asia, maintaining such a coalition was never going to be easy. In the early 2010s, as China-EU relations grew apace, many in Europe started wondering why the U.S. desire for hegemony in the western Pacific was any of their concern in the first place. Indeed, U.S. containment efforts sometimes failed. In 2015, the Obama administration was left humiliated when more or less all of its allies – save for Japan – lined up to join China’s new Asian Infrastructure Investment Bank despite Washington’s intense lobbying to the contrary. After all, considering the depth of the United States’ own exposure to China, why would Europeans shy away from Beijing’s offerings?
The answer, ultimately, was provided by Russia’s Vladimir Putin as he invaded Ukraine, shattering European illusions of immunity to global conflict. Having neglected their own defenses for a generation, Europeans had no choice but to fall back hard on the U.S. security guarantee. Outraged by China’s tacit support of Russia, Europeans were also increasingly willing to get in line and do Washington’s bidding vis-à-vis Beijing. When the United States demanded that ASML’s advanced lithography machines be kept out of Chinese hands, for example, the Dutch government put up export restrictions.
Nevertheless, the future of European involvement in a potential China-U.S. confrontation remained uncertain. The first Trump administration did tremendous damage to the transatlantic alliance that was not easily forgotten in European capitals. Worse still, although the Biden administration reaffirmed U.S. security commitments to NATO, its foreign economic policy showed more continuity than change from his predecessor. Friendlier rhetoric notwithstanding, “America First” was the new bipartisan economic paradigm. The war in Ukraine helped paper over some of these differences, but, beneath the surface, some difficult questions remained about the future of transatlantic relations.
Against this backdrop, it is clear that expecting European allies to follow the United States into an escalating confrontation with China was always going to be a big thing to ask – even when being a U.S. ally had real value. The new Trump administration, by contrast, has worked hard to reduce that value to zero. (And arguably to less than zero for Canada or Denmark, whose territory Trump openly covets.) If Europeans had lingering questions about the reliability of the United States as an ally, those questions have been conclusively answered in the last three months.
In less than a hundred days, Trump has achieved what U.S. adversaries couldn’t dream of in a hundred years: He has simultaneously torpedoed the credibility of the U.S. economy as a safe haven for international business and capital, while at the same time doing irreparable damage to the very alliances that the United States needs in order to prevail in its competition with China in the coming decades. Indeed, if U.S. alliances survive this period at all, they will be of a much weaker and more transactional nature. They will certainly not be the types of alliances in which Europeans blindly stake their economic and security interests on a global confrontation to defend U.S. hegemony.
As things stand now, Trump has set the United States up to confront China alone. This development constitutes a strategic victory for China whose significance is hard to overstate. A few months ago, China was facing a revitalized coalition of advanced democracies, united by their horror of the invasion of Ukraine, and dismayed by China’s tacit support of it. Today, the United States has unmistakably taken Moscow’s side, while launching a multi-pronged attack on the European project. With U.S. credibility in tatters, the world is now hurtling toward the kind of multipolar order that Beijing has always dreamed of.
For Xi Jinping, it would therefore be a strategic blunder of epic proportions to alter the current course of events by invading Taiwan. Indeed, the only thing that could conceivably salvage U.S. alliances at this point is a major global crisis that forces U.S. allies back into the fold. Xi would have to be extraordinarily short-sighted to hand Trump such a crisis just as his adversary’s alliances are falling apart.
That being said, the United States does not have a monopoly on rash decisions and self-sabotaging behavior. Indeed, China’s desire to annex Taiwan should not be underestimated, nor should the sheer fury and misplaced sense of wounded pride that fuels it. Through no fault of its own, Taiwan’s position is and will remain precarious. But if there is any trace of strategic acumen in Beijing, China will bide its time. Rather than starting a war, Xi will simply sit back and watch as Trump “liberates” the U.S. from its global influence.