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China conducted its most significant air breach of the median line in the contentious Taiwan Strait on 3 August.

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Key points

• US House Speaker Nancy Pelosi visited Taiwan on 2 August, addressing the Taiwanese parliament, meeting with Taiwanese president Tsai Ing-wen, and becoming the highest-ranking US official to visit the island since 1997.
• The Chinese government strongly condemned the visit, accusing the US of “hollowing-up” the One China principle and the foundations of US-China relations, and launching a series of retaliatory measures against Taiwan that are highly likely to develop further in the coming months.
• The visit added tension to US-China relations, and is likely to negatively affect co-operation between the two countries and worsen Taiwan's security environment as China's response and Taiwan's countermeasures increase the risk of an accident leading to military escalation.

On 2 August, US House Speaker Nancy Pelosi arrived in Taiwan, becoming the highest-ranking US official to visit Taipei since then-House Speaker Newt Gingrich in 1997. Pelosi addressed the Taiwanese parliament and met with President Tsai Ing-wen, reiterating US support for Taiwan's security and democracy, and stating that solidarity with the Taiwanese people is “crucial”. In response, China, which claims Taiwan as one of its provinces and had voiced its strong opposition to the trip through several stern warnings in previous days, approved a series of trade bans against Taiwan and launched military drills in the waters surrounding the island, accusing the US government of jeopardising US-China relations and cross-strait security.

Chinese perceptions of Pelosi's visit and US-China relations

Pelosi's visit adds stress to the already tense relationship between China and the US, in which cross-strait security has become an increasingly central issue since President Joe Biden was elected in 2020. For the Communist Party of China (CPC) the foundation of US-China relations is the One China principle: that there is only one China, that Taiwan is part of China, and that the People's Republic is the only legitimate government of China.

Under these conditions, the Chinese government tolerates US commercial and cultural exchanges with Taiwan to an extent but sees any sort of political support as an attack to its own national sovereignty. The US response to the One China principle is the One China policy, whereby the US government acknowledges China's position and follows a policy of strategic ambiguity to prevent any unilateral challenge to the status quo by either side of the Taiwan Strait.

However, as President Xi Jinping's rhetoric on reunification and actions around Taiwan intensify, maintaining strategic ambiguity is becoming increasingly difficult for the US, with Biden stating on three different occasions in the last year that the US would defend Taiwan militarily in the event of a Chinese invasion. Although White House officials have scrambled to explain on each occasion that this did not mark a departure from the policy of strategic ambiguity, the CPC has perceived arms sales, visits by lower-ranking officials and former policy makers, and US military activity in the Strait as a demonstration of increasing US support for Taiwan. Consequently, the CPC perceives Pelosi's trip as the latest in a series of actions effectively supporting Taiwan independence, threatening the sovereignty of the People's Republic, and ultimately aiming to prevent China from achieving “national rejuvenation” and becoming a global power.

The CPC increasingly sees US conduct as proof that the US is gradually abandoning its One China policy, despite Biden's clarification to Xi and the media that Pelosi's trip was not endorsed by the US presidency or the Department of Defense. For the Chinese government, these are threats to China's integrity and future, and there is no room for compromise.

Outlook

Pelosi's 19-hour visit is a significant diplomatic victory for Taiwan, as it reinforces ties with the US at a crucial point in the island's relationship with China, and it has the potential to encourage allies to intensify contacts with Taiwan. Tsai referred to Pelosi as “Taiwan's most steadfast friend” and stated that her conduct demonstrated “the United States Congress' rock solid support for Taiwan”. However, this success is perceived in mainland China as a humiliation, and the CPC is highly likely to seek to deter foreign diplomats from emulating the US House Speaker.

Additionally, China's strong rhetoric in the days leading to Pelosi's visit, the CPC's perception of the visit as an attack against the country's sovereignty, and the proximity of Xi Jinping's probable re-election at the 20th National Congress of the CPC in October-November 2022, will almost certainly result in Chinese government retaliation to avoid losing face. Such a response is almost certain to focus on several aspects, including:

• Trade: China accounted for 33% of the total trade value of Taiwan in 2021, including 42% of Taiwan's exports. At the time of writing, China had approved bans on thousands of Taiwanese products, as well as sand exports to the island. These are likely to stay in place and expand in the coming weeks.

• Military: On 2 August, the People's Liberation Army (PLA) Eastern Theatre command announced live-fire, overnight military drills around Taiwan as a “deterrence” and a “warning”. The scale of this response represents an escalation on the live fire exercises conducted during the 1995-6 Third Taiwan Crisis, signalling a strong military component in China's retaliatory actions in the coming weeks. Although this will increase the risk of escalation, an open military conflict between China and Taiwan and the US is highly unlikely, as the CPC is almost certain to prioritise stability in the months leading up to its 20th National Congress.
• Diplomatic: Pelosi's visit prompted a flurry of statements by China's main governmental and party agencies, including the Central Committee of the CPC, the Standing Committee of the National People's Congress, the Chinese People's Political Consultative Conference, the Ministry of National Defence, and the Ministry of Foreign Affairs. All statements framed the event as a provocation by the US, accusing it of attacking Chinese sovereignty, undermining regional stability, and challenging the status quo. Chinese officials are almost certain to use this narrative against the US in international forums and bilateral exchanges with third countries, seeking to diminish US influence and garner support against Taiwan.
• Information: Cyber attacks are highly likely to play an important role in China's response against Taiwan in the coming weeks and months. On 2 August, as Pelosi landed in Taipei, at least four high profile websites were targeted and brought down, including those of President Tsai Ing-wen, the Taiwanese Ministry of Foreign Affairs, the Taiwanese Ministry of National Defence, and of the Taiwan Taoyuan International airport. Taiwanese policymakers, ministerial agencies, and critical national infrastructure are likely targets of future cyber attacks.

However, there are two main factors that have the potential to mitigate the intensity of China's response:

• Alienation of Taiwanese people: President Xi will need to balance a firm response with the need to avoid further alienating Taiwanese people, whose opinion of the CPC is highly likely to worsen in the face of strong retaliatory measures. In recognition of this, on1 August Xi spoke about the necessity to win “the hearts and minds” of Taiwanese people at the 95th anniversary of the PLA.
• High-level political engagement: In the coming weeks, Chinese Minister of Foreign Affairs Wang Yi and President Xi will have the chance to meet with their US counterparts. Wang and Secretary of State Blinken will meet at the 55th ASEAN Foreign Ministers' Meeting in Cambodia on 6 August, and Presidents Xi and Biden signalled in their 28 July call their will to meet in person in November, either at the G20 Summit in Indonesia on 15-16 November or at the APEC summit in Thailand on 18-19 November. Clear communication through high-level contacts is likely to reduce tensions, provide channels to de-escalate, and help find areas of co-operation. Clear communication through high-level contacts is likely to reduce tensions, provide channels to de-escalate, and help find areas of co-operation.

China's response is almost certain to develop in the short-to-medium term as an accumulation of different measures, and its full extent will better be assessed over the next year. This will provide the opportunity for diplomatic channels to defuse the situation and use this crisis to build structures that prevent US-China tensions from further escalating.

(Note: Items from news/wire services are abstracted from the originals and are not verbatim)

Author:  F Xavier Casals, London, UK

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