(This is Part II of a three-part series. Part I can be found here.)

What does Taiwan have going for it? Taiwan has a strong economy, and it is the leading nation for computer chips, especially the most advanced chips. There’s far more to it.

According to a new Center for Strategic and International Studies (CSIS) report, “Taiwan remains a critical partner to U.S. economic interests given its contributions to global advanced technology supply chains. Taiwan’s inputs in the semiconductor supply chain have enabled U.S. companies to maximize their productive efficiency. As the next administration considers how to manage the United States’ relationship with the island nation, officials will need to remember that the partnership has been, and will remain, a feature of supporting U.S. national security. Sound U.S. economic security policy should aim to balance taking advantage of Taiwanese investment to onshore critical and emerging technology (CET) capabilities, while ensuring the island can secure its own domestic ecosystem and make investments in other countries with comparative advantages the United States does not possess.”

Furthermore, the report states, “The economic value of Taiwan to global supply chains for semiconductors and other CETs is immense. By one estimate, Taiwan fabricates nearly a third of the globe’s computing capacity each year, and U.S. companies and consumers are among the leading beneficiaries of direct and indirect trade with Taiwan’s chip sector. As mentioned, Taiwanese semiconductor companies underpinned the growth of the U.S. digital economy.” Due to its dominant role in advanced semiconductors, the importance of Taiwan’s survival as an independent state is extraordinarily critical to the U.S. economy and our national defense.

Under President Xi Jinping, the PRC’s (People’s Republic of China) behavior towards Taiwan has been criminal and is getting worse. For years, the PRC has been embarked on a military buildup of stunning proportions, going from an obsolete, tiny navy to the world’s strongest navy in 2025 with approximately 400 combatants and significantly more combat ships than that of the U.S. In addition, in recent years, the PRC has been building forces to attack and subdue Taiwan. It has just been reported that the Chinese are rapidly developing new amphibious ships with unique elongated bow characteristics that will allow them to land troops in the most difficult locations on Taiwan’s shores.

Also, year after year, the aggressive and illegal incursions by sea and air into Taiwan’s territorial waters or airspace have exploded into almost daily occurrences. According to the Asian Maritime Transparency Initiative in July 2024, “Intrusions in Taiwan’s ADIZ [Air Defense Identification Zone] have increased substantially since Taiwan began reporting data, rising from a monthly average of 81 intrusions in 2021 to 178 through the first half of 2024.”

The PRC is preparing for a war of conquest over Taiwan and is not even hiding its intentions. According to naval experts and Hudson Institute fellows Bryan Clark and Michael Roberts, “China last month mounted its largest show of force around Taiwan in almost 30 years, with more than 90 naval or paramilitary vessels and dozens of aircraft operating in the air and waters around Taiwan’s ports and Japan’s southernmost islands. America has a shrinking set of options to respond if a demonstration like this turns into an actual blockade of Taiwan or a more aggressive form of conflict.”

President Xi’s frequent public statements about Taiwan being brought under the PRC are ominous. According to the UK Independent, “President Xi Jinping reiterated in his New Year’s speech that no one can stop China’s reunification with Taiwan.” Experts think this may occur as early as 2027 or even earlier.

That China plans to take control of Taiwan is not in doubt, given that Chinese officials have said so repeatedly. The only remaining question is whether that aggression will be accomplished by instituting a blockade of Taiwan that cripples its economy, causing it to fall to the PRC, or if the PRC conducts an out-and-out invasion by sea and air and conquers them by force. The Chinese have repeatedly practiced both scenarios in recent years.

For years, the U.S. has conducted war games over the invasion-of-Taiwan scenario. In most war games, the outcome was described by a senior Navy official as “very disturbing.” That is a direct quote from a person known to this author. If the U.S. chooses to help Taiwan defend itself, it will come at a huge price in lost ships and aircraft and thousands of U.S. military lives lost. The actual results are classified, but reports indicate that the U.S. would barely prevail in a conflict over Taiwan, but it would have the price tag of the loss of two of our nuclear-powered aircraft carriers and more than 10,000 dead.

The PRC’s attention to Taiwan has gotten increasingly more provocative, including recently cutting undersea cables that serve the island nation. This is the scenario with the forces that both the PRC and the U.S. have now. Since the PRC is greatly outbuilding the U.S. in combat ships, in a few years, the PRC will have an even bigger lead in the number of ships, aircraft, and missiles, and the result will be our defeat, not victory. That is why most naval experts and now even Congress are waking up to the idea that our shipbuilding and the industrial base to support shipbuilding are at present greatly deficient, and it is urgent to turn that around as rapidly as we possibly can by appropriating more money for ships, by improving our shipbuilding industrial capacity, and by partnering with other nations to get them to build some of our ships. Our NATO allies have sophisticated shipbuilding industries of their own.

I have given this subject a lot of study and thought for some time. For more background information related to Taiwan, see the following articles:

Navy Missiles and the Defense of Taiwan: Part 1

Navy Missiles and the Defense of Taiwan: Part 2

What Are Rare Earth Metals, and Why Should We Care?

Taiwan In China’s Crosshairs

The Looming Taiwan Challenge